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February 1, 2023
*Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It may not have been reviewed, approved or otherwise endorsed by the credit card issuer. This site may be compensated through a credit card issuer partnership.
This article was last updated February 1, 2023 . Terms and conditions may have changed. For the most accurate information, please consult the issuer website.
The Discover it® Secured Credit Card earns cash back at gas stations and restaurants, charges a $0 annual fee and offers a transparent schedule for when you might get the chance to graduate to an unsecured card and get your security deposit refunded.
For consumers establishing credit or who have bad credit, a secured credit card provides a simple, straightforward route to building a solid credit history. A secured credit card requires you to put down a refundable deposit that guarantees your credit line of a (usually) equal amount. Regular purchases and on-time payments make a positive impact toward improving your credit.
The best secured credit cards have no annual fee and typically report your account activity to the credit bureaus. Some offer rewards for purchases in addition to useful cardholder benefits and protections. Over time, you may graduate to an unsecured credit card and get your deposit refunded.
Minimum deposit: $200
Credit limit: $200 to $2,500
Why we picked this card: The Discover it® Secured Credit Card charges a $0 annual fee, comes with a cash back program and offers a transparent schedule for when you’ll be considered for an upgrade to an unsecured card.
| Pros | Cons |
|---|---|
$0 annual fee Earn rewards on your spending Intro APR on balance transfers No penalty APR or late fee the first time you pay late (then $41) | High ongoing APR No 0% intro APR Balance transfer fee |
If you have poor/limited credit and want the opportunity to earn cash back rewards, the Discover it® Secured Credit Card is well worth your consideration.
Cardholders can earn 2% cash back at Gas Stations and Restaurants on up to $1,000 in combined purchases each quarter. 1% unlimited cash back on all other purchases - automatically. Plus, Discover will match all the cash back you’ve earned at the end of your first year.
The Discover it® Secured Credit Card charges a $0 annual fee and requires a $200 security deposit. After you’ve had the card for seven months, Discover will begin conducting monthly account reviews to see if you’re eligible to graduate to an unsecured card and get your deposit refunded.
While the Discover it® Secured Credit Card has a high ongoing 27.24% Variable APR on purchases, it does offer a 10.99% Intro APR for 6 months on balance transfers — which is rare for a credit card intended for those with poor/limited credit. After the intro period, a 27.24% Variable APR applies.
Minimum deposit: $200
Credit limit: $200 to $2,500
Why we picked this card: The Discover it® Secured Credit Card charges a $0 annual fee, comes with a cash back program and offers a transparent schedule for when you’ll be considered for an upgrade to an unsecured card.
| Pros | Cons |
|---|---|
$0 annual fee Earn rewards on your spending Intro APR on balance transfers No penalty APR or late fee the first time you pay late (then $41) | High ongoing APR No 0% intro APR Balance transfer fee |
If you have poor/limited credit and want the opportunity to earn cash back rewards, the Discover it® Secured Credit Card is well worth your consideration.
Cardholders can earn 2% cash back at Gas Stations and Restaurants on up to $1,000 in combined purchases each quarter. 1% unlimited cash back on all other purchases - automatically. Plus, Discover will match all the cash back you’ve earned at the end of your first year.
The Discover it® Secured Credit Card charges a $0 annual fee and requires a $200 security deposit. After you’ve had the card for seven months, Discover will begin conducting monthly account reviews to see if you’re eligible to graduate to an unsecured card and get your deposit refunded.
While the Discover it® Secured Credit Card has a high ongoing 27.24% Variable APR on purchases, it does offer a 10.99% Intro APR for 6 months on balance transfers — which is rare for a credit card intended for those with poor/limited credit. After the intro period, a 27.24% Variable APR applies.
Minimum deposit: $49, $99 or $200
Credit limit: $200 to $1,000
Why we picked this card: The Capital One Platinum Secured Credit Card is unique compared to most secured cards, which typically require your deposit to match the amount of your desired credit limit. But this card offers the chance to qualify for a lower deposit amount, which can be helpful if you don’t immediately have $200 on hand.
| Pros | Cons |
|---|---|
Security deposits start at $49 $0 annual fee Foreign transaction fees: None Automatic credit line reviews in as little as six months | High APR can lead to costly interest charges No rewards program Lower security deposits not guaranteed |
If you think you’ll have trouble putting together a $200 deposit, the Capital One Platinum Secured Credit Card could be a good fit. Capital One offers the chance to qualify for a $200 credit line with a minimum refundable deposit of $49, $99 or $200.
That said, you’ll have to apply and be approved before your minimum deposit is determined, and you’re not guaranteed to qualify for one of the lower deposit amounts.
Another benefit of this card is its $0 annual fee, although it’s worth noting that you won’t earn any rewards on your spending. The card’s 29.74% (Variable) APR can also make carrying a balance costly, so you should only choose this card if you plan to pay your balance off each billing period.
Minimum deposit: $49, $99 or $200
Credit limit: $200 to $1,000
Why we picked this card: The Capital One Platinum Secured Credit Card is unique compared to most secured cards, which typically require your deposit to match the amount of your desired credit limit. But this card offers the chance to qualify for a lower deposit amount, which can be helpful if you don’t immediately have $200 on hand.
| Pros | Cons |
|---|---|
Security deposits start at $49 $0 annual fee Foreign transaction fees: None Automatic credit line reviews in as little as six months | High APR can lead to costly interest charges No rewards program Lower security deposits not guaranteed |
If you think you’ll have trouble putting together a $200 deposit, the Capital One Platinum Secured Credit Card could be a good fit. Capital One offers the chance to qualify for a $200 credit line with a minimum refundable deposit of $49, $99 or $200.
That said, you’ll have to apply and be approved before your minimum deposit is determined, and you’re not guaranteed to qualify for one of the lower deposit amounts.
Another benefit of this card is its $0 annual fee, although it’s worth noting that you won’t earn any rewards on your spending. The card’s 29.74% (Variable) APR can also make carrying a balance costly, so you should only choose this card if you plan to pay your balance off each billing period.
Minimum deposit: $500
Credit limit: $500 minimum, no set maximum
Why we picked this card: The DCU Visa® Platinum Secured Credit Card stands out for its low APR of 15.25% variable in a world where many secured cards have interest rates well above 20%.
| Pros | Cons |
|---|---|
Lower APR on purchases and balance transfers $0 annual fee Balance transfer fee: None Cash advance fee: None | Credit union membership required Savings account required $500 minimum deposit required No rewards program |
If you think you’ll need to carry a balance on your credit card month over month, you’ll want a low interest credit card, like the DCU Visa® Platinum Secured Credit Card. Along with an ongoing APR of 15.25% variable, the card charges a $0 annual fee, no balance transfer fee and no cash advance fee (if you use your line of credit to get cash from an ATM).
You do have to join Digital Federal Credit Union (DCU) to become a cardholder, but luckily, there are many ways to qualify for membership.
Minimum deposit: $500
Credit limit: $500 minimum, no set maximum
Why we picked this card: The DCU Visa® Platinum Secured Credit Card stands out for its low APR of 15.25% variable in a world where many secured cards have interest rates well above 20%.
| Pros | Cons |
|---|---|
Lower APR on purchases and balance transfers $0 annual fee Balance transfer fee: None Cash advance fee: None | Credit union membership required Savings account required $500 minimum deposit required No rewards program |
If you think you’ll need to carry a balance on your credit card month over month, you’ll want a low interest credit card, like the DCU Visa® Platinum Secured Credit Card. Along with an ongoing APR of 15.25% variable, the card charges a $0 annual fee, no balance transfer fee and no cash advance fee (if you use your line of credit to get cash from an ATM).
You do have to join Digital Federal Credit Union (DCU) to become a cardholder, but luckily, there are many ways to qualify for membership.
Minimum deposit: $200
Credit limit: $200 to $3,000
Why we picked this card: The Capital One Quicksilver Secured Cash Rewards Credit Card earns flat-rate cash back on every purchase, making it ideal if your spending fluctuates between different categories from month to month.
| Pros | Cons |
|---|---|
Cash back rewards $0 annual fee Foreign transaction fees: None Automatic credit line reviews | High 29.74% (Variable) APR Geared to people with "fair" credit instead of bad credit Balance transfer fee |
If you want a simple approach to earning cash back rewards, you’ll like the Capital One Quicksilver Secured Cash Rewards Credit Card‘s rewards program. Cardholders earn 1.5% Cash Back on every purchase, every day; 5% Cash Back on hotels and rental cars booked through Capital One Travel (terms apply).
This card also offers a $0 annual fee, and as for foreign transaction fees — there are none. However, the high APR of 29.74% (Variable) can make carrying a balance very expensive, so this card is best for people who plan to pay their credit card bill in full each month.
Minimum deposit: $200
Credit limit: $200 to $3,000
Why we picked this card: The Capital One Quicksilver Secured Cash Rewards Credit Card earns flat-rate cash back on every purchase, making it ideal if your spending fluctuates between different categories from month to month.
| Pros | Cons |
|---|---|
Cash back rewards $0 annual fee Foreign transaction fees: None Automatic credit line reviews | High 29.74% (Variable) APR Geared to people with "fair" credit instead of bad credit Balance transfer fee |
If you want a simple approach to earning cash back rewards, you’ll like the Capital One Quicksilver Secured Cash Rewards Credit Card‘s rewards program. Cardholders earn 1.5% Cash Back on every purchase, every day; 5% Cash Back on hotels and rental cars booked through Capital One Travel (terms apply).
This card also offers a $0 annual fee, and as for foreign transaction fees — there are none. However, the high APR of 29.74% (Variable) can make carrying a balance very expensive, so this card is best for people who plan to pay their credit card bill in full each month.
Minimum deposit: $300
Credit limit: $300 to $5,000
Why we picked this card: Designed for those with poor/limited credit, the U.S. Bank Altitude Go Visa Secured Card offers generous rewards on dining, whether you’re eating in at a restaurant, picking up takeout or getting delivery.
| Pros | Cons |
|---|---|
$0 annual fee $0 foreign transaction fee Earns cash back rewards Annual streaming credit | High APR of 29.24% variable Credit check and hard inquiry required $300 minimum deposit required |
If you spend a large amount on dining each month, the U.S. Bank Altitude Go Visa Secured Card earns could be ideal. Cardholders earn 4X points on dining and takeout, 2X at grocery stores, gas stations and on streaming services, 1X on all other purchases.
Additionally, the $0-annual-fee card offers a $15 credit for annual streaming service purchases, like Netflix and Spotify. As for foreign transaction fees? There are none.
Just know, the U.S. Bank Altitude Go Visa Secured Card comes with an extremely high APR of 29.24% variable.
Minimum deposit: $300
Credit limit: $300 to $5,000
Why we picked this card: Designed for those with poor/limited credit, the U.S. Bank Altitude Go Visa Secured Card offers generous rewards on dining, whether you’re eating in at a restaurant, picking up takeout or getting delivery.
| Pros | Cons |
|---|---|
$0 annual fee $0 foreign transaction fee Earns cash back rewards Annual streaming credit | High APR of 29.24% variable Credit check and hard inquiry required $300 minimum deposit required |
If you spend a large amount on dining each month, the U.S. Bank Altitude Go Visa Secured Card earns could be ideal. Cardholders earn 4X points on dining and takeout, 2X at grocery stores, gas stations and on streaming services, 1X on all other purchases.
Additionally, the $0-annual-fee card offers a $15 credit for annual streaming service purchases, like Netflix and Spotify. As for foreign transaction fees? There are none.
Just know, the U.S. Bank Altitude Go Visa Secured Card comes with an extremely high APR of 29.24% variable.
Minimum deposit: $200
Credit limit: $200 to $2,500
Why we picked this card: The Bank of America® Customized Cash Rewards Secured Credit Card offers uniquely flexible cash back program where you can choose from six different categories to earn the highest cash back rate from.
| Pros | Cons |
|---|---|
Builds credit history Chance to graduate to an unsecured card $0 annual fee Earns cash back | High 27.74% variable APR 3% foreign transaction fee $200 minimum deposit |
If you want to have some say so as to which of your purchases earn rewards, the Bank of America® Customized Cash Rewards Secured Credit Card could be ideal. The $0-annual-fee card lets holders earn 3% cash back in the category of your choice, 2% cash back at grocery stores and wholesale clubs (for the first $2,500 in combined choice category/grocery store/wholesale club quarterly purchases), 1% cash back on all other purchases. Choice category options, which can be changed as often as once a month, include:
Minimum deposit: $200
Credit limit: $200 to $2,500
Why we picked this card: The Bank of America® Customized Cash Rewards Secured Credit Card offers uniquely flexible cash back program where you can choose from six different categories to earn the highest cash back rate from.
| Pros | Cons |
|---|---|
Builds credit history Chance to graduate to an unsecured card $0 annual fee Earns cash back | High 27.74% variable APR 3% foreign transaction fee $200 minimum deposit |
If you want to have some say so as to which of your purchases earn rewards, the Bank of America® Customized Cash Rewards Secured Credit Card could be ideal. The $0-annual-fee card lets holders earn 3% cash back in the category of your choice, 2% cash back at grocery stores and wholesale clubs (for the first $2,500 in combined choice category/grocery store/wholesale club quarterly purchases), 1% cash back on all other purchases. Choice category options, which can be changed as often as once a month, include:
Minimum deposit: $200
Credit limit: $200 to $3,000
Why we picked this card: The OpenSky® Secured Visa® Credit Card requires no credit check to apply and is accessible to consumers with poor/limited credit.
| Pros | Cons |
|---|---|
Builds credit history No credit check to apply Reasonable 21.64% (variable) APR | Can't graduate to an unsecured card $35 annual fee Foreign transaction fee: 3% of each Transaction in U.S. dollars Doesn't earn rewards |
If your credit is too bad to be approved for a traditional or even a secured credit card, the OpenSky® Secured Visa® Credit Card may be your best bet, since it does not require a credit check or bank account to apply. You will, however, need to provide some financial information, such as your annual income and monthly housing payment.
Additionally, the OpenSky® Secured Visa® Credit Card does not provide the opportunity to transition to an unsecured credit card after demonstrating responsible card usage. This means, the only way to get your deposit back is to pay your balance in full and close your card account.
While the OpenSky® Secured Visa® Credit Card offers a reasonable APR of 21.64% (variable), it does charge a $35 annual fee.
Minimum deposit: $200
Credit limit: $200 to $3,000
Why we picked this card: The OpenSky® Secured Visa® Credit Card requires no credit check to apply and is accessible to consumers with poor/limited credit.
| Pros | Cons |
|---|---|
Builds credit history No credit check to apply Reasonable 21.64% (variable) APR | Can't graduate to an unsecured card $35 annual fee Foreign transaction fee: 3% of each Transaction in U.S. dollars Doesn't earn rewards |
If your credit is too bad to be approved for a traditional or even a secured credit card, the OpenSky® Secured Visa® Credit Card may be your best bet, since it does not require a credit check or bank account to apply. You will, however, need to provide some financial information, such as your annual income and monthly housing payment.
Additionally, the OpenSky® Secured Visa® Credit Card does not provide the opportunity to transition to an unsecured credit card after demonstrating responsible card usage. This means, the only way to get your deposit back is to pay your balance in full and close your card account.
While the OpenSky® Secured Visa® Credit Card offers a reasonable APR of 21.64% (variable), it does charge a $35 annual fee.
Minimum deposit: $500
Credit limit: $500 minimum, $25,000 maximum
Why we picked this card: The First Tech Platinum Secured Mastercard® offers a credit line of up to $25,000 — which is one of the highest credit lines currently available for a secured credit card.
| Pros | Cons |
|---|---|
Cash back rewards program Potentially high credit limit $0 annual fee No foreign transaction fee Low APR | High security deposit Must be a member of First Tech FCU to apply |
The First Tech Platinum Secured Mastercard® is one of the best high limit secured credit cards, since you can secure a line of credit worth up to $25,000. This makes it easier to use your secured card for large purchases, and to keep your credit utilization ratio low to boost your credit score.
Like the majority of secured credit cards, the First Tech Platinum Secured Mastercard® has a minimum deposit requirement, but at $500, it is on the high end as far as security deposits go.
The card offers an APR of 12.75% to 18.00% variable and charges a $0 annual fee. Cardholders earn 1 point per $1 on every purchase.
Minimum deposit: $500
Credit limit: $500 minimum, $25,000 maximum
Why we picked this card: The First Tech Platinum Secured Mastercard® offers a credit line of up to $25,000 — which is one of the highest credit lines currently available for a secured credit card.
| Pros | Cons |
|---|---|
Cash back rewards program Potentially high credit limit $0 annual fee No foreign transaction fee Low APR | High security deposit Must be a member of First Tech FCU to apply |
The First Tech Platinum Secured Mastercard® is one of the best high limit secured credit cards, since you can secure a line of credit worth up to $25,000. This makes it easier to use your secured card for large purchases, and to keep your credit utilization ratio low to boost your credit score.
Like the majority of secured credit cards, the First Tech Platinum Secured Mastercard® has a minimum deposit requirement, but at $500, it is on the high end as far as security deposits go.
The card offers an APR of 12.75% to 18.00% variable and charges a $0 annual fee. Cardholders earn 1 point per $1 on every purchase.
Minimum deposit: $200
Credit limit: $200 to $5,000
Why we picked this card: If you qualify for membership with Navy Federal Credit Union, the Navy Federal nRewards® Secured Credit Card offers a chance to build credit with a transparent schedule on when you’ll be considered for an upgrade to an unsecured card.
| Pros | Cons |
|---|---|
Builds credit history Chance to graduate to an unsecured card Reasonable 18.00% variable APR $0 annual fee $0 foreign transaction fee Earns rewards | NFCU membership requires a military connection Credit check and hard inquiry required Rewards expire after four years |
If you or a family member are part of the armed forces, Department of Defense or National Guard, the Navy Federal nRewards® Secured Credit Card should be on your list of secured credit cards to consider.
Intended for those with poor/limited credit, the card requires a security deposit ranging from $200 to $5,000 — which will serve as your line of credit. And after three months of using it responsibly, you may be eligible to receive additional credit to allow for spending beyond your deposit. After six months, Navy Federal will automatically review your account to see if you’re eligible to be upgraded to the Navy Federal cashRewards Credit Card.
The Navy Federal nRewards® Secured Credit Cardholders earn 1X points per dollar spent, which can be redeemed for gift cards, cash and merchandise.
The card also comes with a $0 annual fee and an 18.00% variable purchase APR.
Minimum deposit: $200
Credit limit: $200 to $5,000
Why we picked this card: If you qualify for membership with Navy Federal Credit Union, the Navy Federal nRewards® Secured Credit Card offers a chance to build credit with a transparent schedule on when you’ll be considered for an upgrade to an unsecured card.
| Pros | Cons |
|---|---|
Builds credit history Chance to graduate to an unsecured card Reasonable 18.00% variable APR $0 annual fee $0 foreign transaction fee Earns rewards | NFCU membership requires a military connection Credit check and hard inquiry required Rewards expire after four years |
If you or a family member are part of the armed forces, Department of Defense or National Guard, the Navy Federal nRewards® Secured Credit Card should be on your list of secured credit cards to consider.
Intended for those with poor/limited credit, the card requires a security deposit ranging from $200 to $5,000 — which will serve as your line of credit. And after three months of using it responsibly, you may be eligible to receive additional credit to allow for spending beyond your deposit. After six months, Navy Federal will automatically review your account to see if you’re eligible to be upgraded to the Navy Federal cashRewards Credit Card.
The Navy Federal nRewards® Secured Credit Cardholders earn 1X points per dollar spent, which can be redeemed for gift cards, cash and merchandise.
The card also comes with a $0 annual fee and an 18.00% variable purchase APR.
Minimum deposit: $1,000
Credit limit: At least $1,000; max not specified
Why we picked this card: With the Business Advantage Unlimited Cash Rewards Secured credit card, you can build your business’ credit while earning rewards at the same time. This card has a $0 annual fee and a simple cash back rewards program.
| Pros | Cons |
|---|---|
Earn generous rewards for spending Builds business credit Path to upgrade to an unsecured business credit card | Minimum deposit of $1,000 required Credit check and hard inquiry required Charges 3% of the U.S. dollar amount of each transaction. foreign transaction fee High variable APR |
Small business owners and entrepreneurs can choose from a few different secured business credit cards, including the Business Advantage Unlimited Cash Rewards Secured credit card. We believe this card is ideal for business owners who have at least $1,000 in business funds to put down as a security deposit, as well as those who want to earn unlimited 1.5% cash back on all purchases for each dollar their business spends.
Bank of America also says they periodically review accounts to see if the cardholder is eligible for an upgrade to an unsecured business card, at which point they get their deposit back.
Even so, it’s important to note this card’s high variable APR of 25.99% Variable on purchases. This makes the Business Advantage Unlimited Cash Rewards Secured credit card a poor option for carrying a balance.
Minimum deposit: $1,000
Credit limit: At least $1,000; max not specified
Why we picked this card: With the Business Advantage Unlimited Cash Rewards Secured credit card, you can build your business’ credit while earning rewards at the same time. This card has a $0 annual fee and a simple cash back rewards program.
| Pros | Cons |
|---|---|
Earn generous rewards for spending Builds business credit Path to upgrade to an unsecured business credit card | Minimum deposit of $1,000 required Credit check and hard inquiry required Charges 3% of the U.S. dollar amount of each transaction. foreign transaction fee High variable APR |
Small business owners and entrepreneurs can choose from a few different secured business credit cards, including the Business Advantage Unlimited Cash Rewards Secured credit card. We believe this card is ideal for business owners who have at least $1,000 in business funds to put down as a security deposit, as well as those who want to earn unlimited 1.5% cash back on all purchases for each dollar their business spends.
Bank of America also says they periodically review accounts to see if the cardholder is eligible for an upgrade to an unsecured business card, at which point they get their deposit back.
Even so, it’s important to note this card’s high variable APR of 25.99% Variable on purchases. This makes the Business Advantage Unlimited Cash Rewards Secured credit card a poor option for carrying a balance.
| Credit Card | Welcome Offer | Rewards Rate | Annual Fee | Regular APR | Intro Balance Transfer Rate | Regular Balance Transfer Rate | Balance Transfer Fee | Recommended Credit | Card Review |
|---|---|---|---|---|---|---|---|---|---|
|
Discover it® Secured Credit Card
|
Discover will match all the cash back you’ve earned at the end of your first year. | 2% cash back at Gas Stations and Restaurants on up to $1,000 in combined purchases each quarter. 1% unlimited cash back on all other purchases - automatically | $0 | 27.24% Variable APR | 10.99% Intro APR for 6 months | 27.24% Variable APR | 3% intro balance transfer fee, up to 5% fee on future balance transfers (see terms)* | Poor/Limited | Discover it® Secured Credit Card Review |
|
Capital One Platinum Secured Credit Card
|
No bonus | Non-rewards Card | $0 | 29.74% (Variable) | N/A | 29.74% (Variable) | $0 at this Transfer APR | Poor/Limited | Capital One Platinum Secured Credit Card Review |
|
DCU Visa® Platinum Secured Credit Card
|
N/A | N/A | $0 | 15.25% variable | N/A | 15.25% variable | None | Poor | DCU Visa® Platinum Secured Credit Card Review |
|
Capital One Quicksilver Secured Cash Rewards Credit Card
|
N/A | 1.5% Cash Back on every purchase, every day; 5% Cash Back on hotels and rental cars booked through Capital One Travel (terms apply) | $0 | 29.74% (Variable) | N/A | 29.74% (Variable) | $0 at this Transfer APR | Poor/Limited | Capital One Quicksilver Secured Cash Rewards Credit Card Review |
|
U.S. Bank Cash+ Visa Secured Card
|
No bonus | 5% cash back on up to $2,000 in purchases per quarter in the two categories of your choosing, 2% cash back on purchases in one everyday category of your choice, 1% back on other purchases | $0 | 29.74% variable | N/A | 29.74% variable | 3% of the amount of each transfer or $5 minimum, whichever is greater | Poor/Limited | Review Coming Soon |
|
U.S. Bank Altitude Go Visa Secured Card
|
No bonus | 4X points on dining and takeout, 2X at grocery stores, gas stations and on streaming services, 1X on all other purchases | $0 | 29.24% variable | N/A | 29.24% variable | 3% of the amount of each transfer or $5 minimum, whichever is greater | Poor/Limited | Review Coming Soon |
|
Bank of America® Customized Cash Rewards Secured Credit Card
|
N/A | Earn 3% cash back in a category of your choice each month | $0 | 24.24% variable | N/A | 24.24% variable | 3% of each transaction (minimum $10) | Excellent/Good | Review Coming Soon |
|
OpenSky® Secured Visa® Credit Card
|
N/A | None | $35 | 21.64% (variable) | N/A | N/A | N/A | Poor/Limited | OpenSky® Secured Visa® Credit Card Review |
|
First Tech Platinum Secured Mastercard®
|
None | 1 point per $1 on every purchase | $0 | 12.75% to 18.00% variable | N/A | 12.75% to 18.00% variable | $0 | N/A | Review Coming Soon |
|
Navy Federal nRewards® Secured Credit Card
|
N/A | 1X points per dollar spent | $0 | 18.00% variable | N/A | 18.00% variable | 0% | Poor/Limited | Review Coming Soon |
The information related to the DCU Visa® Platinum Secured Credit Card, U.S. Bank Cash+ Visa Secured Card, U.S. Bank Altitude Go Visa Secured Card, Bank of America® Customized Cash Rewards Secured Credit Card, Navy Federal nRewards® Secured Credit Card and the Wells Fargo Business Secured Credit Card has been collected by LendingTree and has not been reviewed or provided by the issuer of this card prior to publication. Terms apply.
A secured credit card is a type of credit card that requires users to make a cash deposit upfront. This acts as collateral and secures your line of credit. The deposit amount is generally equal to your line of credit which means a $200 deposit would allow you to make up to $200 in purchases with your card.
Secured credit cards work the same as unsecured credit cards (credit cards with no deposit). You can use your secured credit card to pay for purchases anywhere credit cards are accepted. Just like an unsecured credit card, a secured credit card can help build your credit history by reporting your payments to credit bureaus.
The best secured credit cards will report your credit activity to the three major credit bureaus: Equifax, Experian and TransUnion. Many secured credit cards offer regular reviews of your account after a period of time. Customers who pay their bills on time and stay well below their credit limit may be graduated to an unsecured card.
If, for some reason, you do not pay your credit card bill, the money you owe is deducted from your deposit and your account will likely be closed. In situations where you choose to close the account yourself, as long as you have no outstanding charges, your deposit will be returned in full.
The biggest difference is that an unsecured credit card does not require a deposit, while a secured credit card does. Unsecured credit cards generally have more stringent credit score requirements and offer better rewards. Secured credit cards are useful for people with poor credit or those just establishing credit.
There are unsecured credit cards available for consumers who have a poor credit score. However they are usually burdened with expensive fees so we recommend avoiding them.
Look for a secured card that offers transparent terms and no, or a low, annual fee because they can be a better tool to improve your credit without costing you anything.
| Secured credit cards | Unsecured credit cards | |
|---|---|---|
| Report activity to credit bureaus | ||
| Can earn rewards | ||
| Require a security deposit | ||
| Credit limit based on your deposit (usually) | ||
| Credit limit based on creditworthiness | ||
| Can apply with poor or no credit | ||
| May have higher interest rates |
TIP: Avoid unsecured credit cards designed for those with bad credit. These types of cards often charge a variety of fees such as a setup fee, an annual fee, a monthly maintenance fee, a fee to add an authorized user and other such fees. These fees often add up to more than $100 per year, which you will have to pay for the card’s entire life.Secured credit cards are primarily best for two types of consumers: individuals with low credit scores due to mistakes in the past, and consumers with no credit history or limited credit history. But whether you’re looking to rebuild, establish or build your credit with the help of a secured credit card, it’s crucial to practice responsible card usage while doing so — by paying at least the minimum amount due on time each month and staying below your credit limit.
When deciding which secured credit card is best for you, ask yourself these questions:
Most issuers will pull your credit report before approving or rejecting your application. If your credit history is so bad that you’re concerned it may lead to a rejection, a card with no credit check might help. Just be aware that the card will likely charge an annual fee.
You should avoid a secured credit card with an annual fee, if possible. This will not only save money, but will give you the option to keep the account open. You’ll likely move on to better credit cards, but you may want to maintain your secured card, as the overall age of your accounts is a major factor in credit scoring. Opening a card without an annual fee means you can leave your account open indefinitely without having to pay a fee each year. That said, sometimes an annual fee may be worth it, such as if you need a card with no credit check.
Getting a secured card that offers a clear path to upgrade to an unsecured card and get your deposit back gives you a goal to work toward in your financial journey.
A minimum deposit requirement of $200 is fairly typical, but some secured cards will require a minimum deposit as high as $300 or even $500. With the Capital One Platinum Secured Credit Card, you may be able to start with just a $49 deposit. While you may be looking for the lowest deposit possible, you may want to consider a card that allows you to boost your deposit, to secure a larger credit line. This is because credit utilization (how much of your available credit line you are using) is a major factor in your credit score. A larger credit line will help you keep your utilization low, and may improve your credit score.
Building credit, not earning rewards, should be your main focus with a secured card. Still, as long as the credit card rewards don’t tempt you to overspend on your credit card, they can give you a little return on your spending.
Not all banks offer secured cards, but if yours does, you might want to start by considering their card. An existing relationship with an issuer boosts your odds of approval, plus your bank is likely to offer you better cards down the line.
Here’s a list of some banks that issue secured credit cards:
Applying for a secured credit card is simple and doesn’t take much time if you’re prepared. You’ll generally need to do the following:
1. Be prepared to provide some personal and financial information:
2. Fill out the form as completely as possible. Submit your application and wait for confirmation.
3. Check your email and complete all follow-up steps, including sending (via mail or electronically) your deposit.
Once your credit card arrives, you will need to activate it. This is usually done by calling a toll-free number or logging in to your account online, according to the directions that come with your card.
As long as the credit card issuer reports account and payment activity to the three major consumer credit bureaus, using your card responsibly will help build positive credit history. Here are a few tips for building credit:
Pay on timeThe most important factor in improving your credit score is to always pay on time; late and missed payments will hurt your score more than almost anything else. If your due date slips your mind, make the payment as quickly as possible, because many issuers don’t report a late payment to the bureaus until you’re behind 30 days or more. Also, set up automatic payments if possible (most issuers offer this option) — this will help keep your payment timely, while also helping you avoid expensive late fees and interest.
Keep your credit utilization lowNext, pay attention to your utilization — that is, how much of your available credit you’re using. The closer you are to maxing out your credit card, the riskier you seem to lenders and the more your credit score will suffer. A good rule of thumb is to keep utilization at 30% or less. For example, on a card with a $200 credit limit, aim to never have more than a $60 balance at any time.
Avoid applying for too many cardsIn addition to payment history and utilization, avoid applying for new credit too frequently. When you apply for credit, the prospective lender checks your credit report, which generates what’s called a hard inquiry. Each hard inquiry may knock your credit score down a few points. Plus, opening new cards reduces your average age of accounts. A longer average age of accounts is better for your score.
Check your credit reportTake a close look at your credit report to see if you have any old debts in collections or errors on your credit report. While using a secured credit card can help you improve your score, taking care of blemishes on your credit report is also a crucial part of building credit. While you’re at it, take advantage of any credit scoring and credit-monitoring tools that your issuer offers — this will help you catch missed payments or suspicious activity on your credit report before it gets out of hand.
Some issuers allow you to graduate from a secured credit card to an unsecured one, and refund your deposit. Issuers like Discover and NFCU even offer clear timelines for account reviews and upgrades.
The following tips will improve your chances with these issuers:
If you don’t have the cash available to put down as a minimum security deposit, or if you just want to consider all of your options, here are some alternatives to using a secured credit card:
Secured credit cards are most useful to those with poor or bad credit, or no credit at all. Because of their unique features that help you build credit, but are more limited to those with good credit, they aren’t helpful to people with good credit.
Like unsecured cards, some secured cards charge annual fees while others don’t. Our top choice, the Discover it® Secured Credit Card, has a $0 annual fee.
Yes, many people can get a secured credit card with bad credit because secured cards are designed to help rebuild or establish credit. If you’re turned down for a secured card, you may need to consider other options, such as asking a family member to make you an authorized user on one of their cards.
Yes, but not until you’ve graduated to an unsecured credit card or close your account. As long as your account is in good standing when either of those events happen, you should get a full refund of your deposit.
Secured cards require a cash deposit as collateral, whereas unsecured credit cards extend a line of credit with no collateral required.
Also note that secured credit cards may be available to people with bad credit or no credit, whereas unsecured credit cards often have more stringent approval requirements.
Even the best secured credit card in the world only has the amount of power you give it. For example, you can use a secured credit card to boost your credit score if you use credit with care and you never miss a payment. However, you can also see your credit score drop if you max out your secured credit card limit and make late payments.
If you are ultimately able to use a secured credit card to boost your credit score, the number of points you gain will vary based on a wide range of factors.
Yes, it’s possible to be denied a secured credit card. Minimum requirements vary by card issuer. You may be informed of their decision immediately after applying or by a mailed letter.
The most obvious criterion for selecting the credit cards on this list is that all are secured cards, meaning you must submit a security deposit to the issuer. This protects the issuer in case you default on what you owe.
We also evaluated rewards programs. Many of the cards on this list earn cash back or points. While building credit should be your primary focus with a secured card, it’s still nice to have the opportunity to earn cash back on your normal spending.
Another factor was annual fees. Most of the secured cards on this list charge no annual fee, and the one that does (the OpenSky® Secured Visa® Credit Card) offers enough value to consumers with poor/limited credit that some will find the annual fee worth it.
Finally, if a card has other unique features — such as offering the chance for an unusually low security deposit or requiring no credit check to apply — that also weighed in favor of including the card here.
The above offers and/or promotions may have since changed, expired, or is no longer available. Check the Issuers’ website for more details.
