Secured credit cards

[Anonymous]

Whats the best secured credit cards to start rebuilding your credit with and how long should I wait before I apply to get my second credit card.

[Anonymous]

The only one I have any experience with is capital one secured. Both my hubby and I got one and in a month got prequalified for Capital One QS1 and Platinum. We didn't have very many bad things on our reports though, just no credit.

[brother7]

I researched this exact same question for friends who are (re)building credit and have narrowed down the best secured credit cards to two.

1. Capital One Secured MasterCard
2. Discover it Secured Credit Card

At the time I was assisting my friends, the Discover it Secured card didn't exist so I steered them to the Capital One Secured MC.

PROS

• No annual fee.
• Low deposit requirement. Either $49, $99 or $200 deposit for a $200 credit line.
• Credit line increase after 5 monthly payments with no additional deposit.
• Free TransUnion Vantage Score 3.0 through CreditWise.

CONS

• Does not graduate.

Only after my friends started rebuilding did the Discover it Secured card become available.

PROS

• No annual fee.
• Cash back rewards. (Kinda rare for a secured card.)
• Eligible to graduate to unsecured card after 1 year.
• Free TransUnion FICO score through Discover Credit Scorecard.

CONS

• Security deposit required = starting credit line. (Actually, this is typically how most secured cards work. The Cap One Secured MC is the exception.)

If I were advising someone today, I would recommend the Discover it Secured card as a first credit card because 1) it graduates and 2) it's a rewards card.

Regarding when to apply for a second card, my recommended strategy is just before the 6th statement cuts, pay down your balance such that the remaining balance is 1% of your credit limit. For example, if your credit limit is $200 and your current balance is $100, then pay $98 so that the reported balance on your 6th statement is $2 (1% utilization).

Monitor your credit report (I use Credit Karma) to see when your 6th statement gets reported. After it reports, apply for a second credit card.

This is the strategy I've employed to help several of my friends and it has worked beautifully.

Once you have 2-3 unsecured cards, you'll eventually close your secured cards and get your deposit back, as they would have served their purpose of helping (re)build credit.

Hope that helps.

[Anonymous]

I think Bank of America has the best secured card in the market. My went from secured to unsecured in 5 months and I got a limit increase!

It is a little harder to qualify, but well worth it.

[Anonymous]

Discover it seems to be by far the best. Other options are Capital One, Citi & Bank of America. There are a few others, but I wouldn't recommend them.

[RonM21]

A lot of these cards will serve the main purpose, which is to rebuild your credit. If you are looking for what you can or cannot o with each individual card, that is another thing. But for the purpose of rebuilding, most of them get you to the same goal.