Having a large line of credit can significantly boost your credit score, since the amount of credit you use each month (also known as your credit utilization ratio) is a major part of credit scoring. The Merrick Bank Double Your Line^® Mastercard^® dangles the promise of an automatic credit line increase like a carrot to new card applicants.

For the right applicants — those with higher credit scores — this can mean an affordable path to a better credit score, with no deposit required. However, applicants with lower credit scores will find large fees lurking in the fine print of this unsecured credit card. What’s worse: You won’t know what those fees will be until after you apply and get approved for the card. You could land a $0 annual fee, or you could pay more than $100 in fees in your first year.

• No security deposit

  If you’re approved for an offer with no annual fee, then there’s no cost for you to set up this card. The Merrick Bank Double Your Line^® Mastercard^® is an unsecured card, meaning no security deposit is required.

• Reports account activity to the credit bureaus

  The Merrick Bank Double Your Line^® Mastercard^® reports to all three credit bureaus: Equifax, Experian and TransUnion. Some issuers don’t report your account activity to all three bureaus, even though it’s a key feature for building credit — you can’t improve your credit score if your accounts don’t appear on your credit report.

• Automatic credit line review

  After seven months, Merrick will review your account activity and double your line if you’ve made at least your minimum monthly payment on time. A larger credit line — up to $2,700, according to Merrick — can lead to a large score increase, since your credit utilization ratio (the amount of credit line you use each month) accounts for 35% of your score.

• Potential for high fees

  The main drawback to the Merrick Bank Double Your Line^® Mastercard^® is that you may have to pay substantial fees to set up and keep your account open. Furthermore, you can’t tell what the fees will be until after you’ve applied and been approved for the card.

  According to Merrick, your fees could include:

  • $0-$75 one-time setup fee
  • Annual fee: $0 - $72
  • $0-$12 per additional card issued per year

  In other words, you may have to pay $147 for the card in the first year, and a $72 annual fee each year after. In a short time, your fees could equal the deposit for a secured credit card, not to mention — they’re nonrefundable. Plus, you’re stuck paying the fees unless you close your account, which could be an obstacle to trying to increase the age of your accounts (another major factor in credit scoring).

  On the bright side, if you have a higher credit score, you may be able to avoid these fees altogether.

• High APR

  You should avoid carrying a balance on the Merrick Bank Double Your Line^® Mastercard^®, because the APR is really high at 23.70% - 29.95% *variable. However, you can avoid interest charges entirely by paying off what you charge each month by the statement due date.

• No rewards program

  Few credit-building cards come with rewards programs, and the Merrick Bank Double Your Line^® Mastercard^® is no exception. If you’re looking for rewards on your purchases, you may want to look into the Discover it^® Secured Credit Card card instead.

Compare it to the Discover it^® Secured Credit Card

The Discover it^® Secured Credit Card requires at least a $200 security deposit, but you may find it’s a more affordable option over time than the Merrick Bank Double Your Line^® Mastercard^®. There’s a $0 annual fee, no maintenance fees to speak of, and the card comes with a slightly more reasonable 27.49% Variable APR.

Plus, the card comes with a rewards program: 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.

Discover conducts monthly account reviews starting at seven months, and may upgrade you to an unsecured card if you manage your card responsibly. That means you could have your deposit refunded in less than a year, rather than throwing away money on fees.

If you’re confident that your credit score is high enough that you can avoid the fees associated with the Merrick Bank Double Your Line^® Mastercard^®, then give it a try. However, unless you’re comfortable with the uncertainty of paying fees, you should consider applying for a different credit card.

A secured credit card that requires a deposit and charges no fees may be the best route to take. You may have to pay more upfront to open the card, but you won’t have to pay expensive fees to keep your card open. Plus, you can recoup your entire deposit (provided you don’t have any unpaid balance) once you close the card.