Capital One® Secured Mastercard®
The Capital One® Secured Mastercard® is a good option if you’re looking to boost your credit score. It has no hidden charges and an annual fee of $0. The ongoing APR is 24.99% Variable APR, which is high. But even so, it’s a good secured credit card with few fees from a reputable company.
The Capital One® Secured Mastercard® has a few other notable features, including a range of deposit options that start low and the ability to increase your credit line.
Flexible security deposit
Like all secured credit cards, the Capital One® Secured Mastercard® requires a refundable security deposit. But unlike most secured cards, which set your credit limit equal to your deposit, the Capital One® Secured Mastercard® allows for a lower deposit based on your credit score. Your deposit may be $49, $99 or $200 for a starter credit line of $200. You can increase this limit up to $3,000 by making more than the minimum deposit before account opening.
Best of all, if you can’t pay your security deposit upfront, Capital One will let you pay it in installments, as long as you provide the full amount within 80 days of your approval. This is a great benefit for those on a fixed income.
If you’re approved for the Capital One® Secured Mastercard®, the ongoing APR will apply right away; there’s no introductory period with 0% interest.
However, most credit cards for bad credit don’t offer a 0% introductory APR anyway, so you’re not missing anything. Besides, if you’re paying off your balance every month on time and in full, the interest rate won’t matter because interest won’t accrue.
Like most secured cards, Capital One® Secured Mastercard® doesn’t offer rewards.Discover it® Secured Card - No Annual Fee. This card pays 2% cash back on up to $1,000 spent per quarter on dining and gas, and 1% back on all other purchases. It has an annual fee of $0. There’s even a bonus for new cardholders: Get a dollar-for-dollar match of all the cash back you’ve earned at the end of your first year, automatically.
However, there’s a minimum security deposit of $200 for the Discover it® Secured Card - No Annual Fee, much higher than the Capital One® Secured Mastercard®’s $49 or $99 options for those who qualify. Unlike the Capital One® Secured Mastercard®, the Discover it® Secured Card - No Annual Fee provides a credit limit equal to your security deposit in all cases — and not a penny more.
Consider your options
If you’re trying to build your credit, the Capital One® Secured Mastercard® is one of the better choices available. It has earned our respect for having a low minimum security deposit, and for offering a credit limit higher than the security deposit for individuals who qualify.
No matter which card you choose, using a secured credit card responsibly can help you build your credit score. Keep it up, and you should be able to graduate to a card with lower fees and interest, greater rewards — and no security deposit at all.
Last updated April 28, 2016.