Find out what the best secured credit cards are to start building or rebuilding your credit. Most importantly, it won’t cost you anything.
Ratings and opinions are of More Money More Choices editors. It’s not influenced or endorsed by any card issuer or financial institution.
If you’re new to building credit or have made decisions in life that caused your credit score to drop, you have options. Secured credit cards are one of the best ways to establish or re-establish credit.
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Unlike traditional credit cards, a secured credit card requires a deposit. It’s typically between $200 and $500. The deposit is there to protect the financial institution in case you don’t pay your bill.
After you’ve increased your credit score, you can apply for a credit increase or a traditional credit card. If you’re approved, the financial institution will release your deposit back to you.
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The following are the best secured credit cards that you can get to build or rebuild your credit score.
1. Discover it Secured Credit Card
Discover offers an excellent secured credit card that earns 2% cash back at gas stations and restaurants on up to $1,000 in purchases each quarter. On everything else, you’ll earn an unlimited 1% cashback.
Related: The best Discover credit cards
The following are details about the rates and fees for the Discover it Secured Credit Card:
- Annual fee: $0
- APR for purchases: 22.99%
- APR for balance transfers: 10.99% intro APR for the first 6 months. 22.99% after that.
- Balance transfer fee: 3% for the intro promotion. After that, it’s 5% of the amount of each transfer.
- APR for cash advances: 24.99%
- Cash advance fee: The greater of $10 or 5% of the cash advance amount.
- Late payment fee: $0 for the first time. After that, it can be up to $40.
- Returned payment fee: Up to $40.
Apply for a secured credit card from Discover.
The credit limit, which is your security deposit, can range from $200 to $2,500. Based on your income and ability to repay the card, Discover will give you an approved amount. You can choose any amount between $200 and how much you’re approved up to.
If you’re approved and decide to move forward, the funds must come from a bank account. So, make sure you’re ready to provide your account and routing numbers.
Your security deposit is refundable, and Discover does so in two ways. The first way to get your deposit back is through their automatic monthly reviews, which begin at 8 months of having the card.
If you’ve been using it responsibly, you may be eligible for an unsecured card. That’s when Discover will release the funds back to you.
The other way to get your deposit back is to close your account. However, it can hurt your credit. Only close it if you need to.
By not having an annual fee and earning 1% to 2% cashback, Discover has one of the best cards to get you on the path to better credit.
2. Chime Credit Builder Card
Chime is a newcomer in the financial services world, as it was founded in 2013. It’s growing quickly due to fee-free banking. If you’re comfortable with banking online, check out their Credit Builder Card. It’s not your typical secured credit card.
The benefits of the Credit Builder Card are as follows:
- No annual fee, interest, international fees, or maintenance fees.
- No minimum security deposit.
- No credit check.
- Reports to TransUnion, Experian, and Equifax, the three major credit bureaus.
Apply for the Chime Credit Builder Card.
To get a Chime Credit Builder Card, you’ll need to establish a Chime Spending Account and receive a direct deposit of $200 or more within the last 365 days of your application. The direct deposit must be from an employer, payroll provider, or benefits payer.
Now that you know the benefits and how to qualify for the card, how exactly does it work?
First, you’ll transfer money from your Spending Account into your Credit Builder account. The amount you transfer is how much you can spend on the Credit Builder Card. It’s a Visa card, which means you can use it anywhere that accepts Visa.
After loading and using the card, your balance gets paid with the funds that you moved over. It’s a simple and unique method.
Initially, your concern may be the high utilization rate. If you’re using everything that you transferred, are you maxing out the card?
The great news is that it won’t hurt your credit because it doesn’t have a preset credit limit. Also, that means Chime doesn’t report the utilization ratio to the credit bureaus.
All that matters is that you make your payments consistently. According to Chime, people that use the Chime Credit Builder Card see an average credit score increase of 30 points.
3. First Tech Credit Union Platinum Secured Mastercard
First Tech Credit Union is a federally chartered credit union. Being a credit union, it’s member-owned and free of shareholders, which means the interest of its members is the priority.
If you’re already a member or considering membership and want to build your credit, the Platinum Secured Mastercard is a top secured credit card.
You’ll earn 1 point per dollar spent, and there’s no annual fee. As you earn points, you can redeem them for travel, merchandise, or gift cards.
The following are details about the rates and fees for the First Tech Credit Union Platinum Secured Mastercard:
- Annual fee: $0
- Security deposit: $500
- APR for purchases: 9.00% to 18.00%.
- APR for balance transfer: 9.00% to 18.00%.
- Balance transfer fee: None.
- APR for cash advances: 10.00% to 18.00%.
- Cash advance fee: None.
- Foreign transaction fees: None.
- Late payment fee: Up to $25.
- Returned payment fee: Up to $25.
Apply for the First Tech Credit Union Platinum Secured Mastercard.
First Tech’s Platinum Secured Mastercard also comes with purchase protection, which means you’re covered if an item you bought with the card is damaged or stolen within 90 days of purchase.
Overall, First Tech Credit Union offers an excellent secured credit card. The only catch is that you have to become a member, which isn’t too difficult as there are more than 100 ways.
4. Capital One Secured Mastercard
Capital One’s Secured Mastercard is perfect for building your credit because there’s no annual fee and various security deposit options. With responsible usage, you’ll be automatically considered for a higher credit line by the 6-month mark.
Related: Capital One Venture credit card review
The following are details about the rates and fees for the Capital One Secured Mastercard:
- Annual fee: $0
- Security deposit: $49, $99 or $200.
- APR for purchases: 26.99%
- APR for cash advances: 26.99%
- Cash advance fee: The greater of $10 or 3% of the amount of each cash advance.
- Late payment fee: Up to $40.
Apply for the Capital One Secured Mastercard
The Capital One Secured Mastercard is a basic secured credit card. You won’t earn any rewards. However, it allows you to have the opportunity to boost your credit.
If you apply and are approved, Capital One will notify you of the security deposit amount required for your account. After you make the security deposit, they’ll mail you the card.
There are two ways to get the security deposit back. First, you can earn your deposit as a statement credit by using your card responsibly. Second, you can close your account with a zero balance, and Capital One will refund you.
5. OpenSky Secured Visa Credit Card
If you’re concerned about your credit score and don’t have a bank account, OpenSky makes it possible for you to get a secured credit card.
The downside is that it has a $35 annual fee, which may be worth it if you can’t get a card elsewhere.
The following are details about the rates and fees for the OpenSky Secured Visa Credit Card:
- Annual fee: $35
- APR for purchases: 17.39%
- APR for cash advances: 17.39%
- Cash advance fee: The greater of $6 or 5% of each cash advance.
- Security deposit: $200 to $3,000.
- Foreign transaction fee: 3% of each transaction in U.S. dollars.
- Late payment fee: Up to $38.
- Returned payment fee: Up to $25.
- Inactive account fee: $10 per month after 12 months without activity.
Apply for the OpenSky Secured Visa Credit Card.
Compared to other cards, OpenSky has a lower interest rate. While it’s not low, it’s better than others. The drawbacks is that there’s a $35 annual fee for the card.
If it’s your only choice, it’s worth it because you can build your credit. An improved credit score can be more valuable than a fee.
One of the great features is that you get access to a Facebook group of people who are in the same boat as you. There’s a lot of knowledge and experiences that you can learn from.
6. Citi Secured Mastercard
The Citi Secured Mastercard is a standard secured credit card that can help you establish a relationship with Citi.
Since Citi offers other great rewards cards, such as Double Cash, Premier, and Prestige, the secured card may help you move onto other cards.
The following are details about the rates and fees for the Citi Secured Mastercard:
- Annual fee: $0
- Security deposit: $200 to $2,500.
- APR for purchases: 22.49%
- APR for balance transfers: 22.49%
- Balance transfer fee: The greater of $5 or 3% of the amount of each transfer.
- APR for cash advances: 25.24%
- Cash advance fee: The greater of $10 or 5% of the amount of each cash advance.
- Penalty APR: 29.99%
- Foreign transaction fee: 3% of the transaction amount in U.S. dollars.
- Late payment: Up to $40.
- Returned payment: Up to $40.
Apply for the Citi Secured Mastercard.
If you have little or no credit history and would like another Citi credit card down the road, Citi’s Secured Mastercard is a great place to start.
The details are reported to the three main credit bureaus, which ensures that your score grows for each one.
7. Bank of America Customized Cash Rewards Secured
If you want to earn cashback rewards while building your credit, the Bank of America Customized Cash Rewards Secured is an excellent choice.
It earns 3% cashback in the category of your choice. You can choose between gas, online shopping, dining, travel, drug stores, or home improvement and furnishings. Then, you’ll get 2% cashback at grocery stores and wholesale clubs. Everything else will earn 1%.
Being a secured credit card, it earns a good amount of cashback on daily purchases without an annual fee.
The following are details about the rates and fees for the Bank of America Customized Cash Rewards Secured:
- Annual fee: $0
- Security deposit: $300 to $4,900.
- APR for purchases: 23.99%
- APR for balance transfers: 23.99%
- Balance transfer fee: The greater of $10 or 3% of the amount of each transaction.
- APR for cash advances: 26.99% for Direct Deposit and Check Cash Advances. 27.24% for Bank Cash Advances.
- Cash advance fees: The greater of $10 or 3% of the amount of each transaction. 5% if you do it via an ATM, Over-the-Counter, Same-Day Online, and Cash Equivalent Cash Advances.
- Penalty APR: 29.99%
- Late payment fee: Up to $40.
- Returned payment fee: Up to $29.
Apply for the Bank of America Customized Cash Rewards Secured.
If you don’t use the card responsibly, you’ll be subject to a lot of fees. However, doing a good job with it, you won’t pay fees or interest. The best part is that you’ll earn a good amount of cashback.
To redeem the cashback that you’ve accumulated, apply it as a statement credit. It’s the easiest way to use it. If you’d like, you can also transfer it to your Bank of America checking or savings account.
8. U.S. Bank Secured Visa Card
U.S. Bank offers a standard Secured Visa Card that doesn’t have an annual fee. It has one of the highest limits when you compare it with other secured cards, as the highest possible is $5,000.
The following are details about the rates and fees for the U.S. Bank Secured Visa Card:
- Annual fee: $0
- Security deposit: $300 to $5,000.
- APR for purchases: 23.99%
- APR for balance transfers: 23.99%
- Balance transfer fee: The greater of $5 or 3% of the transaction.
- APR for cash advances: 25.99%
- Cash advance fee: The greater of $10 or 5% of the transaction.
- Late payment fee: Up to $40.
- Returned payment fee: Up to $40.
Apply for the U.S. Bank Secured Visa Card.
The U.S. Bank Secured Visa Card doesn’t offer rewards. It’s just a straightforward secured credit card.
What makes it stand out is that the highest limit you can have is $5,000, which is comparable to an unsecured credit card. If you’re looking for a basic card without an annual fee, this is it.
Make your payments on time and in full to avoid interest and fees. It’ll also reflect well on your credit report.
Navy Federal Credit Union is the largest credit union in the nation. However, you or one of your family or household members must have ties to the armed forces, DoD or National Guard to be a member.
If you’re eligible, Navy Federal Credit Union allows you to earn rewards while building your credit with the nRewards Secured Credit Card.
You’ll earn 1 point per dollar spent without limitations. Your points can be redeemed for merchandise, gift cards, or cashback.
The following are details about the rates and fees for the Navy Federal Credit Union nRewards Secured Credit Card:
- Annual fee: $0.
- Security deposit: $200 is the minimum.
- APR for purchases and balance transfers: 18%
- APR for cash advances: 20%
- Late payment fee: Up to $20.
- Returned payment fee: Up to $20.
Apply for the Navy Federal Credit Union nRewards Secured Credit Card.
The nRewards Secured Credit Card is excellent. Navy Federal doesn’t charge fees for foreign transactions, cash advances, or balance transfers. Plus, it doesn’t have an annual fee.
You can also quickly get upgraded. After 3 months, you may eligible for additional credit, which allows you to spend beyond your deposit. After 6 months, you may be able to get the hold removed and upgraded to a cashRewards unsecured card.
It also has perks that aren’t commonly found on secured cards. As a cardholder, you get cell phone protection and Collision Damage Waiver coverage when you rent a car for 15 days or less.
If you’re eligible to bank with Navy Federal Credit Union, this is the best secured credit card to get.
Frequently asked questions
How much do I have to deposit for a secured credit card?
Secured credit cards require a deposit that can range from $200 to $500.
How fast will a secured credit card rebuild my credit?
While your credit can improve in a month, it’s more likely that it’ll gradually increase over 6 months to a year. Make sure you use it responsibly, pay your balance on time and in full.
Will having multiple secured credit cards help more?
Yes, having more than one secured credit card can help your credit because you’ll have multiple payments reporting to the credit bureaus.
Conclusion
There are many great secured credit cards to pick from. The key is to find one that doesn’t charge an annual fee or maintenance fee. By paying your bill on time and in full, you can build your credit without paying interest. If you get a card with rewards, that’s even better.
Additional resources:
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About David Em
Founder
David Em is the founder of More Money More Choices, which he launched to help you take control of your finances and build your dream life. Before More Money More Choices, David worked in leadership positions in the finance industry.
