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Capital One® Secured Mastercard® Snapshot
Good credit is vital for a healthy financial life but establishing a positive credit history takes time. If you’ve never had credit before or you’ve made some past credit mistakes, consider a secured credit card as it can be just the ticket for getting on track to good credit with responsible credit management by you. When used responsibly by you the Capital One® Secured Mastercard® can be a tool to help you build or rebuild your credit and there is no annual fee. Check out Credit Sesame’s review to decide for yourself if it’s a fit for you.
Capital One® Secured Mastercard® Highlights
|Capital One® Secured Mastercard® At a Glance|
|Foreign Transaction Fee:||None|
|Security Deposit:||$49, $99 or $200|
|We think it's good for:||Someone who's hoping to establish credit for the first time|
|Someone who's rebuilding poor credit|
|Someone who wants to avoid an annual fee|
|We think these folks should do more research:||Someone who wants to earn rewards on purchases|
|Someone who carries a balance from month to month|
Capital One® Secured Mastercard® Basics
Annual Fee: $0
Before we dive into the details of the Capital One® Secured Mastercard®, here’s a quick primer on how secured credit cards work. You make an initial refundable security deposit with the card issuer, which typically doubles as your credit limit.
You make purchases against your credit line and to free up available credit, you’ll need to pay at least the minimum due each month. The security deposit is not applied to your balances. It is held as a safeguard against default, should you not meet your financial obligations on the card. Your security deposit will be refunded to you if your secured account is closed, as long as you have met all your financial obligations on the card.
A credit check is typically part of the application process so if you’re worried about what might be on your record, it’s a good idea to take a look at your free credit report card before getting started. With the Capital One® Secured Mastercard® you will get an initial $200 credit line after making a security deposit of $49, $99, or $200.
The minimum credit line is $200 but you can access a higher credit line if you make your first five monthly payments on time, with no additional deposit needed.
This card has no annual fee and no foreign transaction fees. CreditWise® from Capital One® allows access to your credit score and to tools which can help you monitor your credit profile and this is available at no extra cost, and one benefit is so you can see how your credit score is progressing over time.
How the Capital One® Secured Mastercard® Compares to Other Secured Card Options
Besides the Capital One® Secured Mastercard®, there are a number of other secured credit cards on the market. We’ve included profiles of a few of these cards so you can see how they stack up.
Discover it® Secured
Annual Fee: $0
Card features we want to highlight:
- Establish your credit line by providing a refundable security deposit of at least $200 after being approved. Be prepared, your bank information must be provided when submitting your deposit.
- You earn 2% cash back at gas stations and restaurants on up to $1,000 in combined purchases every quarter, automatically. Plus, earn unlimited 1% cash back on all other purchases.
- There are automatic reviews starting at 8 months to see if Discover can transition you to an unsecured line of credit and return your deposit.
- With this card there is no annual fee, you earn cash back, and build your credit with responsible use.
The Discover it® Secured card can be a go-to card if you’re looking to build or rebuild your credit and earn rewards in the process. With responsible use by you this card may be a stepping stone to help you build or rebuild your credit. Here’s a couple of tips – make sure you make at least the minimum payment due on your card and that your payments are received and posted on-time and keep your balance low in relation to your credit limit.
As far as the rewards program for the Discover it® Secured card – 2% cash back at gas stations and restaurants on up to $1,000 in combined purchases every quarter, automatically. Plus, earn unlimited 1% cash back on all other purchases. Also, there is an introductory offer for new cardmembers only – Discover automatically matches all the cash back you’ve earned at the end of your first year. That may be one incentive to consider this card over the Capital One® Secured Mastercard®.
U.S. Bank Secured Visa® Card
Annual Fee: $29
Card features we want to highlight:
- Fund your secured card with a $300 minimum security deposit, $5,000 maximum; (in $100 increments)
- $29 annual fee
The U.S. Bank Secured Visa® Card doesn’t come with a lot of bells and whistles but it does have one advantage: a maximum credit limit of $5,000. Part of your credit score is based on your credit utilization ratio, which is the amount of debt you have versus your total credit line. Having a card with a higher credit limit can work in your favor if you’re keeping the balance low and making your monthly payments on time. However keep in mind to get that $5,000 credit limit you will need to deposit $5,000 of your own money into an account to be held by U.S. Bank as a security deposit. In other words, your credit limit with the U.S. Bank Secured Visa® Card will match the amount of your security deposit.
BankAmericard® Secured Credit Card
Annual Fee: $0
Card features we want to highlight:
- $300 minimum refundable security deposit required to open this account; $4,900 maximum (your maximum credit limit will be determined by the amount of the security deposit you provide, your income, as well as your ability to pay the credit line established)
- Periodically your account will be reviewed and based on your overall credit history you could qualify to have your security deposit returned
- $0 annual fee
If you have a relationship with Bank of America® such as a checking or savings account, the BankAmericard® Secured credit card might be a logical choice if you’re looking for a secured card. A refundable security deposit as little as $300 is required. Your account will be reviewed periodically and based on your overall credit history including your account with Bank of America and other credit cards and loans, you may qualify to have your security deposit returned (not all cardmembers may qualify).
The maximum security deposit allowed for the BankAmericard® Secured credit card account is $4,900. Your maximum credit limit will be determined by the amount of the security deposit you provide, your income, as well as your ability to pay the credit line established. If Bank of America determines you have provided a security deposit that exceeds the calculated maximum amount based on your ability to pay, the difference will be returned to you in the form of a check.
OpenSky® Secured Visa® Credit Card
Annual Fee: $35
Card features we want to highlight:
- The refundable deposit you provide becomes your credit line limit on your card, from as low as $200 up to $3000
- No credit check necessary to apply
- $35 annual fee
The OpenSky® Secured Visa® Credit Card is unusual in that a credit check is not necessary when you apply. That might make it an option for someone who has recently gone through a significant negative credit event or who’s starting completely from scratch. The credit limits are a bit higher then what you could get with the Capital One® Secured Mastercard®. With the OpenSky® Secured Visa® Credit Card you’ll pay an annual fee of $35.
Can You Earn Rewards with the Capital One® Secured Mastercard®?
Unfortunately, the Capital One® Secured Mastercard® doesn’t have a rewards program so you won’t earn any points, cash back or miles on your purchases. It’s appears to be designed as a tool, with responsible use by you, to help you to establish or rebuild your credit. For the opportunity to earn rewards, we’d recommend looking into Discover it® Secured.
Capital One® Secured Mastercard® Pros
The way we see it, the main reason to consider the Capital One® Secured Mastercard®, is that with responsible use by you it can help you build or rebuild your credit. You don’t need a huge security deposit to open your account and, as we already mentioned, you have the opportunity to get access to a higher credit line after making your first 5 monthly payments on time with no additional deposit needed. Which means more spending power.
This card also has a few nice perks built in with Platinum Mastercard® benefits, such as extended warranty protection on items purchased with your card, travel accident insurance when you use this credit card to purchase your fare, 24-Hour travel assistance services if your credit card is lost or stolen, you can get an emergency replacement card and a cash advance. That may give you a little extra peace of mind about making purchases or using the card when you travel. There are some restrictions and exclusions to the benefits.
Capital One® Secured Mastercard® Cons
In terms of drawbacks, there are two things we see that may detract from the Capital One® Secured Mastercard’s® appeal. First, there’s the relatively high variable Annual Percentage Rate (APR) of 26.99% that applies to purchases. That’s bad news for someone who carries a balance from month to month.
The variable Annual Percentage Rate (APR) of 26.99% also applies to balance transfers and cash advances.
Something else that may be viewed as a downside is the absence of any rewards program. Earning cash back or points on the money you spend on your credit card is a valuable perk that this card doesn’t offer.
Should You Get the Capital One® Secured Mastercard®?
The Capital One® Secured Mastercard® is a good way to grow your credit through responsible card use. We caution you to keep the purchase APR in mind and avoid carrying a balance, since that will significantly increase the cost of the things you charge to this card. To explore additional secured card options, take a minute to browse through what’s available from our partners on Credit Sesame’s credit card marketplace.
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Independent Review Disclosure: All the information about the U.S. Bank Secured Visa® Card credit card and BankAmericard® Secured credit card is reviewed independently by CreditSesame.com and has not been reviewed or provided by the issuer of this card. The the U.S. Bank Secured Visa® Card credit card and BankAmericard® Secured credit card are not available through CreditSesame.com.
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