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No matter if you are looking to start building your credit or need to re-build your credit, a secured credit card is one of the best tools to use on your journey.
Secured cards require you to pay an initial deposit that will eventually be your credit limit. These cards are much easier to get approved for if you have little to no credit and the best thing about them is that if you upgrade to a secured card or close the account you get your deposit returned.
You also get the benefit of these cards reporting to all three credit reporting agencies to show proof of good payments and help you build a new credit profile. As long as you make on time payments and keep your utilization low, you will have a stronger credit profile.
Our pick for
Secured Credit Card That Graduates
5.0 - Detailed Review Coming Soon
ANNUAL FEE
$0
REGULAR APR
23.99% (Variable)
INTRO APR
N/A
RECOMMENDED CREDIT SCORE
None - 629 / None To Poor
Very few secured cards give you the opportunity to graduate to an unsecured version of the card. This is where the Citi® Secured Mastercard® is different. You get to use this card to build your credit and after 18 to 24 months of making on-time payments you can qualify to graduate.
Our pick for
Lowest Security Deposit
4.9 - Read Our Detailed Review
ANNUAL FEE
$0
REGULAR APR
26.99% (Variable)
INTRO APR
N/A
RECOMMENDED CREDIT SCORE
350 - 679/ None To Poor
When you have bad credit, a secured card can help you increase your score. The Capital One® Secured Mastercard® will report to all three of the major credit reporting agencies, has the lowest security deposit starting at $49.00, and can give you access to a higher credit line without an additional deposit after you make your first five monthly payments on time (via the Credit Steps Program).
Our pick for
No credit check or No bank account
Capital Bank N.A.'s secure website
3.8 - Read Our Review
ANNUAL FEE
$35
REGULAR APR
17.39%
Variable
INTRO APR
N/A
RECOMMENDED CREDIT SCORE
350 - 679 / Poor To Average
You won't need a credit check when you apply, and you don't need a bank account to qualify either. If these are areas of concern for you, the OpenSky® Secured Visa® Credit Card is definitely worth a look.
Our pick for
Lowest interest rate
on Applied Bank's secure website
ANNUAL FEE
$48
REGULAR APR
9.99%
INTRO APR
N/A
RECOMMENDED CREDIT SCORE
350 - 679 / Poor To Average
This card has one of the lowest interest rates for a secured card which means it will cost you less to use this card. If high interest rates are an area of concern for you, the Applied Bank Secured Visa Gold Preferred Credit Card is definitely worth a look.
Our pick for
Adjustable credit limit
on Synovus Bank's secure website
ANNUAL FEE
$39
REGULAR APR
13.99%
INTRO APR
N/A
RECOMMENDED CREDIT SCORE
350 - 679 / Poor To Average
You can have up to a $2,000 credit limit if you want to deposit that much when apply for this card. If a low starting credit limit is of concern for you, the First Progress Platinum Select MasterCard® Secured Credit Card is definitely worth a look.
Credit Card | Best For | Intro APR | Regular APR | Annual Fee | Learn More |
|---|---|---|---|---|---|
OpenSky® Secured Visa® Credit Card 3.8 | No credit check or no bank account | N/A | 17.39% Variable | $35.00 | Capital Bank N.A.'s secure website |
  First Progress Platinum Elite Mastercard® Secured Credit Card 3.8 | Easy to qualify | N/A | 19.99% APR | $29.00 | on Synovus Bank's secure website |
  First Progress Platinum Prestige Secured Mastercard® 3.8 | Lowest interest rate | N/A | 9.99% APR | $49.00 | on Synovus Bank's secure website |
Green Dot Visa® Secured Credit Card 3.7 | No "hard" credit pull and no bank account | N/A | 19.99% APR | $39.00 | Update: 6/12/20: The Green Dot card is no longer being sold. |
Applied Bank® Secured Visa® Gold Preferred® Credit Card 3.5 | Lowest interest rate | N/A | 9.99% | $48.00 | on Applied Bank's secure website |
First Progress Platinum Select MasterCard® Secured Credit Card 3.2 | Adjustable credit limit | N/A | 13.99% | $39.00 | on Synovus Bank's secure website |
While secured credit cards are for people with no credit history or bad credit, you have to keep in mind that there are still some risks that the lenders aren't willing to take.
For instance if you currently have a bankruptcy or an unpaid charged off credit card.
Even though you will be sending in a deposit to reduce the risk, creditors still want to feel confident in your current ability to pay your bills on time and they want to use your security deposit as a last ditch effort.
You will also need to have some form of income so that you have proof of the ability to pay back what you use.
The process to obtaining a secured card will be pretty much the same for each company; however, there might be a few differences but getting your card looks like this:
You apply online - The credit card company looks at your credit report and score to determine if you are eligable for the card, if so, you're approved.
Pay your deposit - Once you have been approved, you still need to fund your account with the security deposit and depending on the credit card company, you can pay with direct deposit, debit card, credit card, check or money order. Also be mindful that you don't wait too long to fund the account or the company could reject your application.
They send your card - Depending on the company it can take from 7 to 14 days to get your card, once you receive it you want to use the candy bar method (buy 1 candy bar per month) to make sure you are making on-time payments and to keep your credit utilization low.
Pay your bills on time - It is important to pay your bills on time because your secured card(s) will be reported to all three major credit reporting agencies.
Upgrade Your Account - Using the above methods will help improve your credit over-time and when that happens you will be able to apply for unsecured cards. We wouldn't recommend canceling the secured card for at the least 2 to 3 years of usage and even then, if it is your oldest account, still don't cancel it.
These types of accounts might have slipped your mind, but don't miss out on the opportunity to obtain credit or rebuild your credit with store or catalog cards.
Even though you can only use these accounts at the store or location that issued you the credit, they will still report to all 3 credit reporting agencies and help you establish a credit history.
Feel free to check out our Fingerhut review where we go over how their credit account works.
Credit builder loans are being marketed as the way to build your credit, without a credit card. These types of loans are for people with little to no credit and they don't pull your credit to determine your eligibility.
The way they work is that you take out a loan and the creditor holds onto your funds in a savings account. You then repay the loan over a specific monthly time frame and once all the payments have been made, the money is released back to you.
Your credit will now show a positive payment history and a paid off loan; a win win situation for you. Feel free to check out our review of one of the best credit builder loan companies Self Lender.
Another option you have (that won't cost you a thing) is asking a friend or family member, that is great with both their money and credit, to add you as an authorized user to their account.
This option gives you the ability to get established credit and grow your credit history without a need for a hard pull on your credit and without having to come up with any type of deposit.
The only draw back to this is that whatever happens to the credit, it will reflect on your report as well so getting a responsible person is very important.
Of course, if you have no one you can think of then this method doesn't work for you, but it is a great alternative to secured cards.
Card | Annual Fee | Minimum Deposit | Maximum Deposit |
|---|---|---|---|
OpenSky® Secured Visa® Credit Card | $35 | $200 | $3,000 |
Green Dot Visa® Secured Credit Card (*Update 6/12/20 -- This card is no longer available) | $39 | $200 | $5,000 |
Applied Bank® Secured Visa® Gold Preferred® Credit Card | $48 | $200 | $5,000 |
The First Latitude MasterCard® Secured Credit Card | BETTER | OPTIONS | AVAILABLE |
First Progress Platinum Select MasterCard® Secured Credit Card | $39 | $200 | $2,000 |
The Credit Knocks team selects the best secured credit cards available to us on their overall value, these factors include things such as the initial deposit fee required, annual fees, if a credit check is required, if there are any types of rewards programs and the ability to graduate your card as well as interest rates.
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