Having a low credit score can limit your credit card options and result in rejections from unsecured credit card providers. However, a secured credit card can give you the opportunity to rebuild your credit history, especially if your score isn’t where you want it to be.
To avoid multiple hard pulls on your credit report and protect the credit score you have now, you can apply for a secured card that doesn’t require a credit check. Pick one, pay your bill in full on time and build your credit slowly — and, eventually, you may be able to upgrade to an unsecured card.
With this secured credit card, you can look forward to building up your credit score by making on-time payments. While it has an annual and monthly fee, this secured card does not require a credit check and comes with a competitive purchase APR of 17.99%.
No credit check. This is one of the rare credit cards in Canada that requires no credit check.
Control over your credit limit. The amount of security deposit you offer up will determine your monthly credit limit, which means you can control whether you have a high or low credit limit. Credit limits range from $200 to $10,000.
Competitive purchase rate. This card has a purchase rate of 17.99%. This interest rate can easily be avoided by paying off your balance in full each billing cycle.
Free education. Refresh Financial offer access to free educational financial training on their online portal called Refresh f.i.t, which includes informationregarding finances, money and tips on building up your credit score.
Annual and monthly fees. There is an annual fee of $12.95 a year, with an additional fee of $3 per month for the card. Altogether, this card will cost you $48.95 in fees.
Paying late. Paying off your balance in full means you can avoid interest rates. If you don’t pay in full however, you’ll be looking at an interest rate of 17.99%.
Monthly inactivity fee. Should you not use your credit card for a billing cycle, you’ll incur a $2 inactivity fee.
Other cards that come with easy approval
As you can see above, no credit check secured cards are pretty rare in Canada. Still, running into a credit check doesn’t necessarily mean you won’t be approved for a card. Currently, there are two such cards we feel are worth mentioning for easy approval.
1. Home Trust Secured No Fee Visa
Home Trust offers a secured visa card that allows you to choose the best option for your needs: choose a no annual fee card that comes with a purchase rate of 19.99% APR, or choose a lower purchase rate of 14.90% with an annual fee of $59 (or the option to pay $5 per month).
No annual fee option. If you choose the no annual fee option, you’ll save $59 annually – but watch out for the higher purchase APR of 19.99%.
Low interest rate option. Should you choose the low rate option, you’ll get a purchase rate of 14.90%. However, you’ll have to pay an annual fee for this option.
Control over your credit limit. The amount of security deposit you offer up will determine your monthly credit limit. Credit limits range from $500 to $10,000.
Credit check. Home Trust will check your credit report for this card, however approval is usually high.
No annual fee option. The no annual fee option comes with a higher purchase rate of 19.99%.
Low interest rate option. The low rate option comes with an annual fee of $59, or a payment of $5 monthly.
2. Capital One Guaranteed Secured Mastercard
Although no credit card is ever guaranteed, this Capital One card guarantees approval, as long as you meet four conditions. These are:
Be 18 years of age or the age of majority in your province or territory
You haven’t applied for a Capital One card in the last 30 days or had an account not in good standing in the last year
You don’t have an existing Capital One account or a pending application,
You provide the necessary security funds.
Guaranteed approval. Capital One claim that approval for this card is guaranteed, as long as you meet four conditions (listed above).
Ability to control credit limit. Choose a credit limit between $300 to $2,500.
Credit check. Capital One will check your credit report for this card, however approval is very high.
Annual fee. This card has an annual fee of $59, or the option to pay $5 every month.
Interest rate. Paying off your balance in full means you can avoid interest rates. If you don’t pay in full however, you’ll be looking at an interest rate of 19.8%.
Lower credit limit. While $2,500 is a decent credit limit, this maximum limit is much lower than other secured credit cards.
Compare secured cards for 2019
Frequently asked questions about secured cards
No, most of the time your provider won’t pay interest on your security deposit. You’ll usually receive back the exact amount that you provided.
Many secured credit card providers will check your credit report, which is referred to as doing a “hard pull”. For that reason, you may be declined if your credit score is too low. If you’re declined for a secured credit card, consider applying with Refresh Financial, since they likely won’t check your credit score.
Emma Balmforth is a Producer at Finder. She is passionate about cryptocurrency, credit cards and loans, and enjoys helping people understand the often confusing world of finance. Emma has a degree in business and psychology from the University of Waterloo. She wants to help people make financial decisions that will benefit them now and in the future.
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