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Use our table to compare secured credit credits for bad credit. These cards are designed to help you build your credit. Note, you may need to pay the security deposit when you apply for a card. If you don't have enough to fund the deposit, learn how to save up for a deposit.
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A secured credit card is designed to help you build your credit score and works similarly to a traditional credit card. The main difference is you need to put down a security deposit before you can open a secured card.
This deposit helps protect the issuer in the event you fall behind on your payments or default. Because of this, the bank extends you credit when you otherwise wouldn’t qualify for a credit card. This gives you the opportunity to build your credit by showing you can responsibly manage a credit card. To learn how secured credit cards work, read up on our guide.
Avoid predatory cards with high fees or rates. Once you choose a card, you may have to provide your bank credentials during the application to pay the deposit.
Now that you have a card, use it to raise your credit score by paying your full balance on time each month.
Our picks for the best secured cards
Back to topBanks | Do they offer a secured card? | Available secured cards |
---|---|---|
Amex | N | N/A |
Bank of America | Y | BankAmericard® Secured Credit Card |
Barclaycard | N | N/A |
Capital One | Y | Capital One® Secured Mastercard® |
Chase | N | N/A |
Citi | Y | Citi® Secured Mastercard® |
HSBC | N | N/A |
Discover | Y | Discover it® Secured |
U.S. bank | Y | U.S. Bank Secured Visa® Card |
Wells Fargo | Y | Wells Fargo Business Secured Credit Card |
Because secured cards are designed for building credit, there are some trade-offs to consider.
A secured card is one of the most effective methods of restoring a poor credit score. But are secured credit cards worth it for your circumstances? To make that call, examine these factors related to secured cards.
Secured credit cards function similarly to standard cards, but with some important distinctions. Here are the five most common questions we receive on the subject.
How effective are secured cards at helping consumers build their credit?
They are quite effective. In most cases, for clients with limited or no credit history at all, it is a great option to build their FICO score. In particular, secured credit cards are popular among recent immigrants. The advantage of a secured credit card is exactly the fact that it helps you to create a positive credit history. The disadvantage is cost. Those cards tend to be expensive, and many carry annual fees and high-interest rates.
What should a consumer do for their credit if they get denied a secured card?
If the goal of initially applying for a secured credit is to obtain credit (i.e. borrow money), then a consumer should apply for credit elsewhere (other credit cards, store cards, banks, etc.). However, if the consumer’s goal is to improve her/his credit, then I believe a mental shift is necessary. A person denied a secured card likely has a bad credit history, which is often caused by making late payments or missing payments completely. Dedicating oneself to paying bills on time – always and forever – might be the best way to improve credit enough to obtain a loan in the future.
When is a secured credit card a good idea?
A secured credit card is a good option when one doesn’t have a good enough credit history to qualify for a regular credit card. You have to make an initial collateral deposit which serves as your credit line, and still have to pay it off every month to avoid getting charged interest and or late fees. It is important to look at the terms and conditions of the card to make sure they don’t charge egregious fees. There are many competitive secured credit card offers so you should shop around to get the best deal. An alternative is to just use a debit card attached to your checking account, though that would not help you build your credit score.
Can secured credit cards really help consumers raise their credit?
It could be assumed that a likely correlation exists between secured credit card usage and improved creditworthiness; however, to assert such with a conviction would be tenuous because other factors also play a role.
The main thing however is that people new to credit or attempting to repair bad credit should consider using secured credit cards. While solely relying on such a card may not be the optimum tactic, this could be a move in the right direction to help consumers improve or raise their credit.
Can spending more money help consumers build their credit score faster?
If a borrower hopes to increase their credit score quickly it is generally not advisable to spend more money fast by using a credit card. Financial institutions monitor ratios including total balance outstanding divided by the total credit available. If this percent indebtedness grows too quickly a financial institution may flag the account and accelerate risk management. Lenders do not like uncertainty and are more comfortable with predictable behavior. One best practice for increasing a credit score quickly is to become more predictable by spending around 25% of a credit limit monthly and then paying off the balance in full at the end of every billing cycle. This demonstrates a history of on-time payments, credit avoids interest costs, and provides historical behaviors can increase a credit score and give confidence to future lenders.
How do secured credit cards help consumers build their credit score?
The key is access to credit. People with new or damaged credit scores struggle to get approved for some favorable credit products, which prevents them from building or rehabilitating their credit score. The main reason why they get denied is the high risk of default creditors sense. By securing their credit cards, this risk disappears or diminishes and the consumer now has an opportunity to have credit and build it through time with a positive and consistent track record. I would recommend consumers that have limited access to credit to cautiously consider this type of options.
Secured cards are a useful tool for building or rebuilding your credit score and moving on to an unsecured card. Your main goal is to spend responsibly, pay your balance on time and graduate to more beneficial credit cards as soon as possible
Back to topSteven Dashiell is a credit cards writer at Finder. He's worked on 250 Finder articles and counting, helping readers embrace and maximize credit cards. Backed by nearly a decade of research and reporting experience, Steve's work can be seen on Debt.com, CreditCards.com and Lifehacker.
Avoid the worst credit cards by keeping an eye on their features.
Earn cash back, travel rewards or get low interest rates while you build your credit.
Both provide the same freedom as a credit card, but without the risk of falling into debt.
Are you looking for a secured card with a high credit limit or no credit check?
Need to build a credit history? Get started with a secured credit card like First Premier.
Secured credit cards with rewards are rare, but they do exist.
We look at minimum and maximum deposit amounts, how long you have to fund your card and more.
Here are the next steps you should take after having your application for a secured credit card denied.
We offer money-saving tips to putting away money for your deposit — a key hurdle to rebuilding your credit.
Heavy fees make this a poor choice for building credit.
Our goal is to create the best possible product, and your thoughts, ideas and suggestions play a major role in helping us identify opportunities to improve.
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