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Even if you have no credit history or a low credit score, a credit card might be more obtainable than you think. A secured credit card could be yours with a one-time deposit of as little as $49. You might also be able to get a secured card by starting and successfully managing a credit-building account. Check out our recommendations for the best secured credit cards from our partners and start building credit today.
Read our full Capital One Platinum Secured Credit Card review.
Read our full Open Sky Secured Visa Credit Card review.
Read our full Citi Secured Mastercard credit card review.
Read our full First Progress Platinum Prestige Mastercard® Secured Credit Card review.
Read our full First Progress Platinum Elite Mastercard® Secured Credit Card review.
A secured credit card is a type of card backed by collateral, usually in the form of a deposit from the cardholder. The typical consumer who gets a secured card has no credit history or a low credit score, but the deposit makes a secured card easier to qualify for. You might have an opportunity to upgrade to an unsecured card with no deposit if you use the secured card responsibly.
As an alternative to paying a security deposit, some products give you access to a secured credit card after you establish your creditworthiness through a credit-building account that involves gradually paying off a small installment loan.
A secured credit card can be more than just a convenient way to make your everyday purchases. It can also give you an opportunity to establish or rebuild credit. Whether you need to build your credit history or get back on track financially, responsible use of a secured credit card could provide a starting point.
Check out the expert advice and recommendations on this page to get the information you need to know.
| Card Name | Best For | Annual fee | Bankrate Review Score |
|---|---|---|---|
| Capital One Platinum Secured Credit Card | Building credit | $0 | 3.0 / 5 (Read full card review) |
| OpenSky® Secured Visa® Credit Card | No minimum credit score requirement | $35 | 3.2 / 5 (Read full card review) |
| Discover it® Secured Credit Card | Secured card with rewards | $0 | 4.0 / 5 (Read full card review) |
| Citi® Secured Mastercard® | No monthly maintenance fee | $0 | 3.0 / 5 (Read full card review) |
| First Progress Platinum Prestige Mastercard® Secured Credit Card | No required credit check | $49 | 2.6 / 5 (Read full card review) |
| First Progress Platinum Elite Mastercard® Secured Credit Card | Best for easy application and processing | $29 | 3.0 / 5 (Read full card review) |
| Self – Credit Builder Account + Secured Visa Credit Card | Best for building credit with savings | One Time $9 + Secured Card $25 | 3.0 / 5 (Read full card review) |
Read our full Capital One Platinum Secured Credit Card review.
Jump back to offer details.
Read our full OpenSky® Secured Visa® Credit Card review.
Jump back to offer details.
Read our full Discover it® Secured Credit Card review.
Jump back to offer details.
Read our full Citi Secured Mastercard review.
Jump back to offer details.
Read our full First Progress Platinum Prestige Mastercard Secured Credit Card review.
Jump back to offer details.
Read our full First Progress Platinum Elite Mastercard Secured Credit Card review.
Jump back to offer details.
Read our Self – Credit Builder Account + Secured Visa Credit Card review.
Jump back to offer details.
Most credit cards are unsecured, meaning that they don’t require you to put up any kind of collateral. When you get a secured credit card, you pay a security deposit that typically serves as both collateral and as your credit limit.
Why do you have to pay a deposit on a secured credit card? The deposit is kind of a tradeoff. You have to put money down, but it makes secured cards accessible for those with limited credit history or bad credit. Keep in mind that using a secured credit card responsibly could lead to:
If you practice good habits, you might be able to rely on good credit instead of collateral when you apply for your next card.
Getting a secured card can be an excellent path to take on the journey to a good credit score. Their relaxed application requirements make them a great fit for many types of people looking to build or repair their credit:
While the majority of credit cards don’t accept cardholders with no credit history, most secured cards will accept true credit beginners. By opening a secured credit card account, you have a chance to establish a history of responsible spending and timely payments. Sound credit habits make it easier to eventually enjoy the benefits that come with a good credit score.
If you’ve opened a line of credit previously but haven’t had success in improving your score, a secured credit card could help. Credit cards in general can provide a useful way to build a credit score when they’re used responsibly. Plus, secured cards often come with free access to your credit score online, report your payment activity to major credit bureaus and feature other credit-building perks.
Anyone who has had to deal with debt, bankruptcy or anything else that undermines a credit score could take advantage of a secured credit card. Some secured cards don’t require a credit check or a minimum score to apply, making them among the most accessible options available.
As with all credit cards, making timely payments is such an important part of using a secured card. There are major downsides to missing payments and it’s tough to catch up once you fall behind, so it’s essential to get into the habit of making sufficient payments on time. Here are some guidelines:
Almost any product, including a credit card, can have advantages and disadvantages. Here’s a list of potential benefits and potential drawbacks of a secured credit card.
If you’re shopping for a secured card, think of your credit as a house. You might need to build one from the ground up, or you might already have one that’s in need of some renovations. Either way, the job requires tools, planning and time.
Spending wisely with your secured card and making timely payments will reflect well on your overall credit, but the turnaround won’t happen overnight. Fortunately, you do have some options for addressing credit problems in a relatively short period of time, including:
Inaccurate information in your credit history can make you a less attractive customer in the eyes of lenders. Make sure that the information on your credit report, a long-term record of how you’ve used credit from the past to the present, is accurate and up-to-date.
Contact AnnualCreditReport.com to request a free copy of your credit report from the major credit bureaus: Equifax, Experian and TransUnion.
If you have a limited credit history, a so-called “traditional” credit score might not tell the whole story. Newer credit score products put added emphasis on good credit habits such as timely payments on your utility and cell phone bills and positive bank account balances.
Ultra FICO, Experian Boost or similar options could benefit someone who’s handled their finances responsibly but doesn’t have experience with credit cards or loans.
New credit applications that involve hard inquiries (also called hard pulls) temporarily lower your credit score. Be careful about applying for multiple credit accounts in a short period of time. Whenever possible, look for pre-qualified offers or applications that don’t require a credit check.
After using your secured card responsibly for a while, your credit score should start to rise. The progress happens most quickly if you keep your balances low and make your payments on time. Once you’ve achieved a good credit score (FICO or VantageScore of 670 or greater), you can think about shopping around for an unsecured card that might offer better rewards programs and lower fees.
When it comes to going about your upgrade, you have a few options. Some credit cards have both a secured and unsecured version. If that’s the case with your secured card, you may be able to simply call the customer service line and ask to upgrade for free. Some issuers may even allow you to upgrade to a variety of unsecured cards while keeping the same account. Keep in mind that you may not be eligible for the new card’s sign-up bonus if you’re upgrading from a secured card.
The other option is to apply for an additional card instead of upgrading your existing account. With cards for fair credit and beyond, you have more options to explore credit cards from other issuers this way. However, your credit may take a temporary dip since the new account will decrease your average age of accounts.
Once approved for a new card, you can either keep your secured card open or cancel it. If your secured card comes with fees, such as a maintenance or inactivity fee, it may be a good idea to cancel it. Otherwise, there’s no harm in keeping it open for the occasional small purchase to add to the length of your credit history (15 percent of your credit score).
Applying for a secured card is a simple and effective way to build up less-than-ideal credit. However, there are other avenues if you decide against it.
One way to dip a toe into credit building is to become an authorized user on a parent’s or spouse’s card. For young adults, this can be a good way to establish credit without the pressure of choosing a credit card. Once you’ve built up your credit, you’ll be more likely to be approved for the best credit cards.
Becoming an authorized user may be a good choice for parents who want to monitor their child’s purchases. However, those pursuing this option should trust their authorized user not to overspend; with most issuers, authorized users typically have as much spending power as the primary cardholder. American Express is one exception that allows cardholders to set spending limits for your authorized users.
Some credit card issuers will allow you to apply with a cosigner — ideally someone who has good credit and trusts you to use your card responsibly. Though you are the primary cardholder in this situation, the cosigner is liable for all of your debts.
Like being an authorized user, having a cosigner could give you access to unsecured credit cards that you wouldn’t qualify for with your credit alone. But some issuers do not allow cosigning. If you don’t see the option on the application, you can call the customer service line to ask.
Every card that Bankrate reviews is evaluated on a 5-star scoring system. If you need a secured credit card, you’re probably focused on establishing or re-establishing credit. Making our choices for cards this category involves putting special attention on factors such as:
A lot of secured credit cards will charge cardholders an annual fee. Our analysis takes into account the overall value offered by the card, through rewards and other perks, against the annual fee to help you find the most value.
Secured cards can sometimes have extra fees that you may not see on other credit cards. We pay close attention to the fine print so we can factor these fees into the overall scores and make sure you’re aware of them beforehand.
Some secured cards offer rewards programs, such as cash back. Rewards can be complicated, but we make it simple with a breakdown that clearly shows the real value they offer to cardholders.
Some cards have extra advantages for cardholders. Introductory offers and credit monitoring are examples of benefits that add to a card’s overall value.
If you’re interested in secured credit cards, check out these Bankrate resources for more essential information:
Have more questions for our credit cards editors? Feel free to send us an email, find us on Facebook, or Tweet us @Bankrate.
* See the online application for details about terms and conditions for these offers. Every reasonable effort has been made to maintain accurate information. However all credit card information is presented without warranty. After you click on the offer you desire you will be directed to the credit card issuer's web site where you can review the terms and conditions for your selected offer.
Editorial Disclosure: Opinions expressed here are the author’s alone, and have not been reviewed or approved by any advertiser. The information, including card rates and fees, is accurate as of the publish date. All products or services are presented without warranty. Check the bank’s website for the most current information.
