Secured credit cards are made for people trying to rebuild their credit history, after which they can move to “regular” cards. In this review, we look at the Capital One® Secured MasterCard® which stands out from competing offerings as it comes with low fees as well as the opportunity to qualify for credit limit increases without adding more funds to your security deposit. Let’s dive into details, shall we?
- 24.99% variable APR on purchases and balance transfers
- Ability to increase credit without required deposit
- Some benefits that are typically not associated with secured cards
- 0% balance transfer fee
- No foreign transaction fee
- No annual fee
How It Works?
After applying to the Capital One® Secured MasterCard®, you have 80 days to make the complete security deposit of $49, $99, or $200, depending on your creditworthiness. After that, you will receive your card with an initial credit line of $200.
Increase credit: Initially you can increase credit by depositing more than the required minimum within 80 days of account opening and before activating your card. Or you can make your first 5 monthly payments on time.
Rebuild your credit history: Your account activity and payments are reported to the three major credit bureaus, including TransUnion, Equifax, and Experian.
No annual, balance transfer and foreign transaction fees: Unlike some other secured cards, this one is basically free. Also, it is a good option for travel as it doesn’t include any foreign transaction fees.
Platinum MasterCard benefits: Including auto rental insurance for protection against collision damage or theft, travel accident insurance, 24/7 travel and roadside assistance services, and price protection that includes reimbursements for the price difference within 60 days after the purchase.
Capital One benefits: Capital One’s $0 Fraud Liability which eliminates the cardholder’s responsibility for any payments made after their card is lost or stolen. Also, cardmembers are able to pick their own monthly due date and method of payment.
Costs
- $0 Annual Fee
- 24.99% variable APR on purchases and balance transfers
- Initial deposit of $49, $99, or $200, based on your creditworthiness
- 0% Foreign Transaction Fee
- 0% Balance Transfer Fee
At Capital One’s secure website
Pros
- Low fees for a secured card. These would include annual, balance transfer and foreign transaction fees.
- Credit limit increases that could be increased simply by making first 5 monthly payments on time.
- Card benefits aren’t typically associated with secured cards – that’s not the case with the Capital One® Secured MasterCard®.
Cons
- The variable APR of 24.99% is among the highest APRs offered with any secured card. If you, however, pay your balance in full each month, nothing to worry about here.
- Security deposit is interest free – you won’t earn a single dime from keeping that money in the bank.
Is This the Card For You?
If you’re trying to rebuild your credit history and will be paying your balances in full and on time – go for the Capital One® Secured MasterCard®. The high APR makes this card a hard sell for those who won’t be paying their dues regularly. On the other hand, the lack of an annual fee makes it more appealing to the general public. That public could also use this card when travelling abroad to enjoy the lack of foreign transaction fees.