If you are seeking a credit card with no credit history or an improper credit score, the answer is right here. Secured credit cards are perfect for people developing or rebuilding credit, even with no credit history. With proper and responsible use, these cards are useful in building a stable credit history while raising the credit score.
The secured credit cards require placing cash security into the savings account. The amount in the collateral account is equal to or almost equivalent to the credit limit of the card. The collateral protects the card issuer in case the charges to the credit card are unpaid.
Keeping balances low and timely payments result in better credit report history for secured credit cards.
Secured Mastercard® from Capital One
With the benefit of possible access to a higher credit limit in six months, the secured credit card comes with a range of features. It allows the privilege to repay the deposit in portions. For a user with no credit history, the advantage of the card is that it charges no annual fees. Besides, the requirement for the security deposit is comparatively low as well. The high APR is a visible disadvantage. The card is fitting for those who struggle to meet the standard deposit specifications for a secured credit card. The initial credit limit is disappointing as it is low.
Pros
- It does not necessarily need the security deposit to be as big as you want the credit limit.
- There is also a provision to pay the security deposit in installments.
- The absence of annual and foreign transaction charges.
Cons
- It requires a bank account.
BankAmericard® Secured Credit Card
The BankAmericard® Secured Credit Card serves the purpose of pumping up the credit. With security features such as fraud alerts, this is another card that charges no annual fee. It is the most convenient for those who already have an account in Bank Of America. Apart from the above facilities, the card also provides an overdraft protection facility. The negative aspects include a foreign traction fee of 3% and a high APR.
Pros
- It provides access to FICO credit scores every month for free.
- The card comes with a digital wallet technology allowing syncing with Google Pay or Apple Pay.
- No annual fees and convenient upgrade to an unsecured card.
Cons
- It demands a minimum $300 deposit, which is higher than the usual $200 deposit.
U.S. Bank Secured Visa® Card
With a low APR and few frills, the credit card is easy to use. It is ideal for people willing to have a higher credit line. Other features that come in handy are access to TransUnion credit score. It also provides fraud alerts. However, the card requires a large deposit. If you are willing to earn rewards while you build your credit, this is not a suitable card for you.
The good part is that the design is so that you get to build credit faster with this one.
Pros
- The security deposit goes into an interest-bearing account that the customer gets after closing the account.
- It allows a $5,000 maximum credit line that is way higher as compared to other secured cards.
- Staying on track is effortless with tools like autopay.
Cons
- It charges an annual fee of $29.
First Progress Platinum Prestige Mastercard® Secured Credit Card
Probably the most desirable secured credit card when it comes to people with no or poor credit history. The card does not require a credit check, and that is one of the chief advantages of opting for this card. The $49 annual fee is a drawback, but the quick online application process is super-easy. The deposit is fully refundable. The 9.99 variable APR is lower than the other secured cards available. The credit card provides a great option to start building credit, the easy way.
Pros
- The application and approval process is quick and hassle-free.
- It does not require a minimum credit score.
- The low APR rate.
Cons
- It charges for late payment fees along with the annual charges.
Discover it® Secured
Best in terms of rewards, the secured credit card by Discover comes with no annual charges. For the first year, it offers a dollar-for-dollar match for all the cashback. It is ideal for students and people who are aiming to build their credit. Graduating to an unsecured credit card is convenient with the card. The credit card has a high APR, but that is worth overlooking with so much that the card has to offer. It still requires a bank account.
Pros
- Zero annual fees.
- It offers the best rewards for a secured credit card.
- The regular payments mean the account is automatically up for qualifying into an unsecured card.
Cons
- The high APR, along with the need to have a bank account.
Conclusion
Secured credit cards are an easy option for people with no credit score or bad credit score. The choices of secured credit cards available today are baffling. The facilities they offer are nowhere near secured card cards in comparison. Yet with changing times, there are credit cards in the market that offer great rewards, do not require a bank account, and have zero annual fees to pay. Others offer facilities that range from no foreign transaction fee to lower APR charges. These are suitable according to everyone’s specific needs.
Picking the correct secured credit card for yourself requires browsing through aspects such as annual fees and minimum deposit amounts. It is necessary to check if the secured credit card communicates to three credit bureaus.
The amount you deposit for the secured credit card is crucial as it becomes the credit limit. The demand for a cash deposit for a collateral account for secured credit cards does not seem favorable for many; it still does good for the cardholder.
They are an excellent way to build and maintain a less-than-ideal credit.
With responsible use, there is an option to upgrade to an unsecured credit card while building credit with a secured credit card.
Pick your secured credit card carefully and enjoy building your credit while paying your bills with the card.