The Best Secured Credit Cards of September 2020

The Best Secured Credit Cards of September 2020

Our comprehensive guide details the top secured credit cards available today, as well as what to consider when choosing a secured credit card.

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It may not have been reviewed, approved or otherwise endorsed by the credit card issuer. This site may be compensated through a credit card issuer partnership.

Secured credit cards are geared to consumers who have bad credit or no credit history at all. The end goal of signing up for one of the top secured credit cards is improving your credit score so you can qualify for any credit card you want, as well as other types of loans.

You'll have to put down a cash deposit as collateral, but secured cards are considerably easier to get approved for than traditional unsecured credit cards. The APRs and fees tend to be reasonable and when you close your secured credit card account in good standing later on, you’ll get your deposit back.

If you are on the hunt for your best secured credit card on the market today, you’re in the right place. ValuePenguin compared all the top offers in this space to find the secured cards that offer the best value for consumers. The list you’ll find below includes the top secured credit cards based on their fees, their ability to help you build credit and the perks they offer.

Best secured credit cards 2020

What is a secured credit card? | Secured vs. unsecured credit cards | What is the best secured credit card? | How to get a secured credit card | How to use a secured credit card | FAQs

Best secured credit card with no credit check

OpenSky® Secured Visa® Credit Card

Our thoughts

The OpenSky® Secured Visa® Credit Card is a good option for consumers who have bad credit or a past bankruptcy, since you don’t even have to endure a credit check to get approved. You can apply for the card, put down a cash deposit of from $200 up to $3,000 and secure a line of credit equal to your collateral amount. From there, you can use your card anywhere Visa is accepted, and your credit movements and payments will be reported to the three credit bureaus – Experian, Equifax and TransUnion.

Once you’re approved, you can even set up email alerts that notify you when a purchase is made or your payment is due. These alerts help you stay on top of your spending while getting you in the habit of paying your credit card bill early or on time each month.

This card does require a $35 annual fee, but the investment can be well worth it if you need to build credit but you cannot get approved for another credit card.

Benefits

  • Apply online with no credit check
  • Reports to all three credit bureaus
  • Get started with a security deposit as low as $200
  • Email alerts can help you stay on track

Drawbacks

  • Annual fee of $35 applies
  • You won’t earn rewards

Best secured credit card with rewards

Discover it® Secured

Our thoughts

The Discover it® Secured is an exceptional secured credit card that offers a better-than-average rewards program. As a cardholder, you’ll earn 2% cash back at restaurants and gas stations on up to $1,000 in combined purchases each quarter (then 1% back). You’ll also earn 1% back on everything else you buy. Also note that Discover will match all the rewards you earn after the first year.

You can get the Discover it® Secured with a relatively low minimum deposit as well – as little as $200. That makes this card a good option if you need to start building credit but you have limited funds. The deposit is fully refundable once you close the card, minus any fees or outstanding balance. You can deposit up to $2,500 to secure a larger credit line. (Your credit line will equal the amount you deposit.)

You’ll also get access to your FICO® Score for free on your monthly credit card statement.

Benefits

  • Earn rewards on your spending
  • Low deposit requirement
  • Reports to all three credit bureaus
  • Automatic account reviews starting at eight months to see if you qualify for an unsecured card

Drawbacks

  • Rewards can entice you to spend more

Best high limit secured credit card

U.S. Bank Secured Visa Card

Our thoughts

When you sign up for the U.S. Bank Secured Visa Card, your security deposit is your credit limit. However, this card gives you the option of securing a line of credit of from $300 up to $5,000, which is higher than many competing cards.

An annual fee of $29 applies, but the U.S. Bank Secured Visa Card reports to all three credit bureaus and it even gives you a free TransUnion credit score on your monthly statement. You also get the option to choose your own payment due date, which can be helpful if you prefer to pay bills on a certain date of the month or on payday.

Benefits

  • Secure a line of credit of up to $5,000
  • Free credit score on your monthly statement
  • Choose your own payment due date
  • Build credit since your payments will be reported to all three credit bureaus

Drawbacks

  • $29 annual fee applies
  • You won’t earn rewards

Best secured credit card with a low APR

State Department EMV Savings Secured Visa Platinum Card

Our thoughts

The Savings Secured Visa Platinum Card offers a nice combination of benefits for those who can qualify. This card comes with No Annual Fee, no foreign transaction fees and no balance transfer fees. You’ll also qualify for a fixed APR of 11.99%, which is considerably lower than other secured credit cards charge.

Once you sign up for the Savings Secured Visa Platinum Card, you’ll begin earning 1 Flexpoints Rewards point for each dollar you spend. You’ll get a 25-day grace period on purchases, and you’ll qualify for cardholder perks such as lost luggage reimbursement and travel and emergency assistance services.

Just keep in mind that you’ll have to join the State Department Federal Credit Union (SDFCU) to qualify for this card, and that eligibility requirements apply. Specifically, you have to be a Department of the State employee or a family member of one. Some organizational affiliates are also eligible to join, as well as American Consumer Council (ACC) members.

Benefits

  • No Annual Fee, no foreign transaction fees and no balance transfer fees
  • Low fixed APR of 11.99%
  • Earn rewards on your spending
  • Qualify for cardholder benefits like lost luggage reimbursement and travel and emergency assistance services

Drawbacks

  • Credit union eligibility requirements apply, and you may not be able to join
  • Rewards can entice you to spend more

Best secured credit card with a low deposit

Capital One® Secured Mastercard®

Our thoughts

The Capital One® Secured Mastercard® is a great all-around credit card for people looking for more financial flexibility. One standout feature of this card is its security deposit: You can secure the card with as little as $49. This low security deposit requirement can be helpful if you need to build credit but you don’t have a lot of cash. Just keep in mind that you’ll need an authorized bank account to make this deposit.

Also note that you may qualify for a minimum credit limit of $200 with the initial security deposit. This means you can actually carry a larger balance than your security deposit, while building credit along the way.

The Capital One® Secured Mastercard® also carries a $0 annual fee, and you can automatically be considered for a higher line of credit after six months of on-time payments. You even get to pick your own payment due date.

Other benefits include no foreign transaction fees, travel and emergency assistance services, auto rental collision damage waiver coverage, travel accident insurance and extended warranties.

Benefits

  • Get started with a security deposit as low as $49, yet qualify for a credit line of at least $200
  • $0 annual fee and no foreign transaction fees
  • Qualify for important cardholder benefits such as travel and emergency assistance services, auto rental collision damage waiver coverage, travel accident insurance and extended warranties
  • Build your credit score
  • Capital One automatically considers you for a higher credit line after six months of on-time payments

Drawbacks

  • You won’t earn rewards
  • A high APR applies (currently 26.99% (Variable))

Other good secured credit cards

DCU Visa Platinum Secured Credit Card

Our thoughts

The DCU Visa Platinum Secured Credit Card is a credit union card, so not everyone is eligible. Generally speaking, you have to be a family member of a DCU member to qualify, but you may be able to join based on the company you work for or retired from, an organization you belong to or based on where you live.

If you meet eligibility requirements, however, this card is definitely worth considering. First, you can qualify with No Annual Fee, no balance transfer fee and no cash advance fees. The DCU Visa Platinum Secured Credit Card also comes with an APR as low as 11.5%, which can help you save money on interest over time.

Benefits

  • No Annual Fee, no balance transfer fees and no cash advance fees
  • APR as low as 11.5% available

Drawbacks

  • Credit union membership required
  • You won’t earn rewards on your spending

nRewards® Secured Credit Card

Our thoughts

The nRewards® Secured Credit Card is a good option for consumers who are affiliated with the military. Membership to this credit union is available to active duty military members, Army and Air National Guard personnel, Delayed Entry Program personnel, Department of Defense (DoD) civilians, U.S. government employees assigned to DoD installations, contractors assigned to DoD installations; and their family members.

If you’re eligible, you’ll like the fact that this card comes with No Annual Fee, no balance transfer fees, no foreign transaction fees and no cash advance fees. You’ll also earn rewards at a rate of 1 point for each dollar you spend, which can be redeemed for merchandise, gift cards or cash back.

If you decide to apply, you can get started with an initial security deposit of $200. Navy Federal Credit Union even promises to see if you can upgrade to an unsecured card after three months, and on a monthly basis after six months. This card also comes with rental car coverage and cellphone protection.

Benefits

  • No Annual Fee, no balance transfer fees, no foreign transaction fees and no cash advance fees
  • Earn rewards on your spending
  • Qualify for benefits such as rental car coverage and cellphone protection
  • Upgrade to an unsecured card in as little as three months

Drawbacks

  • Military affiliation required
  • Rewards can entice you to spend more

What is a secured credit card?

A secured credit card is a type of credit card that requires a cash deposit as collateral. While putting down a cash deposit to secure your own line of credit may not seem ideal, secured credit cards give consumers with bad credit the opportunity to build credit when they cannot get approved for another credit card or loan. Secured credit cards are often one of the first cards consumers can qualify for after bankruptcy.

Once you put down a cash deposit as collateral, you’ll normally secure a line of credit in the amount of your deposit. This means that, if you put down $200 as collateral, your initial line of credit will likely be for $200.

Security deposit aside, a secured credit card functions just like an unsecured card – you can use it to make purchases up to your credit line, and then pay off those purchases by the due date. By using the card and paying your bill on time, you can build your credit score, since your payment history will be reported to the credit bureaus. Once you cancel or upgrade your secured credit card in good standing, you’ll receive your initial security deposit back.

What's the difference between a secured and unsecured credit card?

While secured credit cards require a cash deposit as collateral, unsecured credit cards do not. This means that, when you are approved for an unsecured credit card, you qualify for a traditional line of credit you can borrow against.

Also, for applicants with low credit scores, secured cards tend to offer better terms than their unsecured counterparts. Benefits of secured cards often include reasonable rates and fees and appealing cashback rewards programs.

What is the best secured credit card for you?

The best secured credit card on the market today is the one that helps you build credit with the perks and benefits you want the most. The top secured credit cards report to the three credit bureaus, Experian, Equifax and TransUnion, which is what makes them helpful for building credit. Other features to look for in a secured credit card include a lack of fees, the ability to earn rewards and the option for a small security deposit.

You should also look closely at each card's ongoing Annual Percentage Rate (APR). APRs on secured credit cards can vary tremendously, sometimes ranging very high. Though you should avoid carrying a balance, you’ll want a card with a reasonable APR in case you can't pay your bill in time.

How to get a secured credit card

If you’re wondering how to get a secured credit card, you can start with this guide. Compare the secured credit cards on this page until you find one that might suit your needs. From there, click on the card to read the full review, and take the steps required to apply.

Secured credit cards require you to fill out an online application with information such as your name, your address, your phone number, your Social Security number and your income. Plan on providing these details as well as your banking information to expedite your security deposit.

Once you fill out the application to apply, you may find out whether you qualify right away, or you may have to wait for a response in your email or via the regular mail. If you’re approved, the security deposit will be taken from your bank account and your new secured credit card will be sent to you in the mail.

How to use a secured credit card

The point of picking up a secured credit card is using it to build your credit score. With that in mind, you’ll want to make sure you are prepared to use the card responsibly.

You should start by using your card for small purchases you can afford to pay off right away. From there, pay your secured credit card bill in full each month to keep your credit utilization as low as you can. To build a credit history, you'll need to use the card on a regular basis while paying it off on time each month. Since many issuers offer an autopay feature, you might consider charging a small recurring amount to your card (like a gym membership) while setting your card to autopay.

You may also want to take steps to monitor your credit score during this time. Many secured credit cards make this easy by giving you access to your credit score each month. Ultimately, your credit score should improve over time as you make on-time payments on your credit card.

These questions and answers about secured credit cards can help you find the right card option for your needs. Keep reading to learn about the top secured credit card options and how they work.

Does Chase have a secured credit card?

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Chase does not offer a secured credit card. However, Chase does offer a variety of cashback credit cards, travel credit cards and credit cards geared to people who want to save money with 0% APR for a limited time.

Do secured credit cards build credit?

Secured credit cards help you build credit since they report your credit movements and monthly payments to the three credit bureaus – Experian, Equifax and TransUnion. To build credit with a secured credit card, you should make sure you make all of your monthly payments early or on time, and that you keep your balance fairly low. Most experts suggest keeping your credit utilization at 30% or below for the best credit score results.

What banks offer secured credit cards?

A variety of banks and credit unions offer secured credit cards. The main credit card issuers that offer secured cards include Capital One, Discover, Citibank, Wells Fargo and U.S. Bank.

Can you rent a car with a secured credit card?

Secured credit cards work just like traditional credit cards, meaning you can use them for purchases up to your credit limit. A secured credit card can work when you rent a car provided your credit limit is high enough to cover the cost plus the amount the rental agency puts on hold.

What is a security deposit for a credit card?

A security deposit is an amount of money you put down as collateral when you get a secured credit card. This amount of money effectively secures the line of credit you get with your card, and you can receive your security deposit back when you close your secured card or upgrade in good standing.

How much will a secured credit card raise my score?

How much a secured credit card can raise your credit score depends on a wide range of factors, including how responsibly you use it. Your best bet is making your payments early or on time and keeping your balance as low as possible. Over time, these actions will yield your best results.

Are secured credit cards good?

Secured credit cards are an excellent tool to build credit when you cannot get approved for an unsecured credit card or a loan. While putting down a security deposit is less than ideal, secured credit cards give you the chance to build credit when other payment options, such as debit cards, will not.

Can you be denied a secured credit card?

It’s possible to be denied for a secured credit card based on a wide range of circumstances, although denials are rare. If you’re worried about being denied, consider a secured credit card that doesn’t require a credit check.

Can I close a secured credit card?

You can close a secured credit card whenever you want to. Provided your account is in good standing and your credit card balance is zero, you’ll receive your full security deposit back when you do.

Does a secured credit card require a credit check?

Some secured credit cards require a credit check, but a handful of secured credit cards do not. If you’re looking for a secured credit card that won’t check your credit, consider the OpenSky® Secured Visa® Credit Card.

How much should I put on a secured credit card?

You can put down as little as $49 with some secured credit cards while others require a minimum security deposit of $200 or more. Keep in mind that your security deposit is typically equal to the line of credit you can qualify for.

Is a secured credit card revolving credit?

Both secured and unsecured credit cards are considered revolving credit since they offer a line of credit you can borrow against and pay off over and over. An installment loan, on the other hand, lets you borrow a fixed amount of money and pay a fixed payment over a fixed period of time.

The information related to OpenSky® Secured Visa® Credit Card, Discover it® Secured, U.S. Bank Secured Visa Card, Savings Secured Visa Platinum Card and Capital One® Secured Mastercard® has been independently collected by ValuePenguin and has not been reviewed or provided by the issuer of this card prior to publication.

These responses are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser's responsibility to ensure all posts and/or questions are answered.

Advertiser Disclosure: The products that appear on this site may be from companies from which ValuePenguin receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). ValuePenguin does not include all financial institutions or all products offered available in the marketplace.

How We Calculate Rewards: ValuePenguin calculates the value of rewards by estimating the dollar value of any points, miles or bonuses earned using the card less any associated annual fees. These estimates here are ValuePenguin's alone, not those of the card issuer, and have not been reviewed, approved or otherwise endorsed by the credit card issuer.

Example of how we calculate the rewards rates: When redeemed for travel through Ultimate Rewards, Chase Sapphire Preferred points are worth $0.0125 each. The card awards 2 points on travel and dining and 1 point on everything else. Therefore, we say the card has a 2.5% rewards rate on dining and travel (2 x $0.0125) and a 1.25% rewards rate on everything else (1 x $0.0125).