The Capital One Secured MasterCard is often touted as one of the best for people who are looking to establish or rebuild their credit. This is one of the few partially secured cards, so you can potentially have a balance higher than the amount you deposit.
While there are always caveats when using any secured card, we think the card’s solid reputation is warranted. Why? The card is available to virtually everyone and comes with many of the same features of an unsecured card. For more information on this card and to apply to their offer, click here.
Below you’ll find our full assessment of the Capital One Secured MasterCard.
Does it report to all three credit bureaus?
The Capital One Secured MasterCard does report to all three credit bureaus on all purchases. This makes it a good card for anyone looking to establish or rebuild credit.
Additionally, this card reports to all three credit bureaus as “unsecured.” In other words, it shows up on your report the way any regular credit card would. This is a big benefit is you’re hoping to prove to a lender that they deserve a home or auto loan.
In terms of building your credit score, FICO doesn’t particularly care if the card is unsecured or not. So really, the concerns around whether or not a secured card reports as “unsecured” has to do with whether or not you plan on taking out a loan where lenders would examine your report.
Do you qualify?
Anyone who can put down a security deposit qualifies for this card. Most people will be able to afford the very low minimum deposit of $49.
The application process is also incredibly simple. Just visit their website and open an account online. You’ll then have 80 days to make your initial security deposit.
What is the credit limit?
The credit line for this card ranges from $200 to $3,000 dollars. The minimum deposit of $49 will earn you a $200 credit limit. You can also deposit $99 or $200 to get a higher credit limit. You can increase the credit limit up to $3,000 by making deposits in increments of $20 either online or on the phone.
Is there an interest bearing savings account?
What is the interest rate?
The interest rates on this card aren’t great. In fact, they’re not even good.
According to the Capital One website, the interest rates for the Secured Mastercard stand at 24.9 percent variable APR. This is actually up from 22.9 percent earlier in 2015. It’s on the high side, but if you use this card properly and pay the balance in full each month, it won’t matter. The bank also dropped the annual fee when it raised the APR, which helps to offset the interest rate hike.
What are the fees for balance transfers and cash advances?
There is currently no offer for balance transfers and the cash advance rate is the same as the APR, 24.9 percent. In addition, there is a cash advance fee of either $10 or 3 percent of the total cash advance amount, depending on which amount is greater.
In other words, if your cash advance total is $333.33 or lower, the fee is $10. If the cash amount is higher than $333.33, then you’re looking at the 3 percent fee and is based on the amount of the cash advance.
How much is the annual fee and other fees?
One great thing about this card is the fact that there’s no annual fee. This is a relatively new feature. The downside, though, is that the bank increased the card’s APR to make up for not charging an annual fee. But remember, a high APR isn’t necessarily a bad thing if you pay your account balance in full each month.
There are also no foreign transaction fees, which makes the card a great choice for international travel. Since this is a MasterCard, it’s accepted worldwide.
According to the card’s terms, the late payment fee can be up to $35. Unfortunately, the terms don’t spell out how they determine whether a fee will be less than $35. Regardless, if you pay your bill on time, it won’t matter.
Can you upgrade to an unsecured card?
As with many secured cards, you will have to close your account in order to apply for an unsecured credit card. At the time of this writing, there is no direct upgrade path to an unsecured card.
What are the features?
This card has features aplenty. It really is just like using a regular credit card. A few examples:
- The credit tracking feature monitors your credit score for free.
- Personalized payment means you can select your own monthly due date and payment method.
- Good news for iPhone users: The card can be used with Apple Pay.
- Extended warranties apply on purchases.
- 24/7 customer service.
- 24/7 roadside assistance.
- 24/7 travel assistance services.
- Auto rental insurance means there’s no need to spend money on insurance when you rent a car. You’re already covered if you use the card to rent a vehicle.
- Travel accident insurance.
- A 60-day price protection offer means that if you find an item you purchased earlier for a lower price, the card reimburses you for the difference.
What’s our bottom line?
While the interest rates on this card are high, the pros far outweigh the cons and make it a solid choice for someone who is looking to establish or rebuild credit. If you use this card responsibly, you won’t have to worry about the high interest rates.
We recommend this card for consumers who plan to pay their entire balance each month. For more information on this card and to apply from their offer, click here.