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2018's Best Secured Credit Cards

Below are our picks for 2018's best secured credit cards. Unlike unsecured cards, these cards require that users make a refundable deposit into a bank account to secure a credit line:

Average APR
17.90%
Average Annual Fee
$34.28
Rate Trend
0.14%
since last month

Review Breakdown: Secured Cards

Secured credit cards are a great way for those with a limited or bad credit history to improve their credit through responsible use. Finding the right secured card, however, can be tricky. Below is a summary table that makes it much easier. Compare features of the top secured cards, then simply click on your card of choice to visits its online application.

Here are 2018's best secured credit cards:

Best Secured Credit Card
Rank Card Name Annual Fee Credit Needed Expert Rating
1 Capital One® Secured Mastercard® $0 Limited, Bad ★★★★★ 4.9
2 Discover it® Secured $0 Please refer to issuer's website ★★★★★ 4.5
3 First Progress Platinum Elite MasterCard® Secured Credit Card $29 Bad Credit ★★★★ 4.0
4 First Progress Platinum Prestige MasterCard® Secured Credit Card $49 Bad / No Credit ★★★★ 3.9
5 First Progress Platinum Select MasterCard® Secured Credit Card $39 Bad Credit ★★★★ 3.8
6 OpenSky® Secured Visa® Credit Card $35 No credit check ★★★★ 3.5

How a Secured Credit Card Works

Brittney Mayer
By: Brittney Mayer
Finance Contributor
Updated:
How a Secured Credit Card Works
CardRates.com Guide: Secured Cards

The main factor that determines whether you’re approved for a new credit card is your credit risk. Consumers with established credit histories and high credit scores present the lower risk, so they’re the most likely to be approved for new credit. Similarly, applicants with no or limited credit histories and/or low credit scores are least likely to be approved due to their perceived high credit risk.

If your poor or limited credit history has caused you to be turned down for unsecured credit cards, a secured credit card may be a good solution for building credit. With secured credit cards, you can make a cash deposit that will act as collateral for the credit line, thus reducing the risk to the issuer and increasing your chances of being approved.

Make a Security Deposit

While you may need to go through a credit check to determine your eligibility, many secured credit cards will approve a wide range of applicants so long as you can make the required minimum security deposit (typically $200 to $500). In most cases, the credit limit of your secured credit card will be equal to the size of your deposit.

The deposit you make for a secured credit card is fully refundable, and it will only be used by the issuer if you default on your account. If you want to recover your deposit at any time, you can do so by closing your account with a $0 balance.

Reporting Your Usage

Actually using a secured credit card is exactly the same as using a secured credit card. You can make purchases in-store and online, just as you would any other card.

Additionally, most secured credit card issuers report your usage and payment history to the major credit reporting bureaus, just as they would a typical unsecured card. However, this is important to verify before you choose a card, as you’ll need your payment history to be reported to the bureaus to establish and build credit.

By using the secured credit card and making the monthly payments on time and as agreed, you’ll start to build a positive payment history. Depending on your secured credit card issuer, improving your credit and showing responsible card use may result in an automatic upgrade to an unsecured credit card (and the refund of your deposit).

Read the Terms and Conditions

Just as with an unsecured credit card, secured credit card issuers have different terms and conditions for use. Look at the offers carefully and compare the fees they charge. While options without annual fees are out there, many secured credit cards will charge an annual fee of between $25 and $99, regardless of whether you actually use the card.

Look for other fees as well, including things like monthly account maintenance fees, credit limit increase fees, and late payment fees. These charges can really add up if you’re not aware of them.

Additionally, be sure to note the APR you will be charged, and if there is a grace period for purchases. While it’s always best to pay your bill in full each month — card’s with a grace period will allow you to avoid interest entirely this way — a lower APR can be a boon in times when it’s not possible.

Photo source: mint.com

Editorial Note: Opinions expressed here are author's alone, not those of any bank, credit card issuer, airlines or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

The information on this page was reviewed for accuracy on .

About the Author

Brittney Mayer Finance Contributor Brittney Mayer

Brittney Mayer is a contributing editor for CardRates.com, where she uses her extensive research background to write comprehensive consumer guides and in-depth company profiles. Leveraging her vast knowledge of the financial industry, Brittney’s work can be found on websites such as the National Foundation for Credit Counseling, US News & World Report, CreditRepair.com, Lexington Law, BadCredit.org, and CreditCards.com, among others. Brittney specializes in translating complex financial jargon and ideas into readable, actionable advice on lending best practices.

Brittney Mayer

Advertiser Disclosure: The credit card offers that appear on this site are from credit card companies from which CardRates.com receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). CardRates.com does not include all credit card companies or all available credit card offers. See the credit card issuer's website for specific terms and conditions of each card.