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The Fingerhut FreshStart Credit Account is an installment loan provided by Fingerhut. It’s issued by WebBank.
If you want to improve your credit and have had trouble being approved for credit cards, this account could be a way to get your foot in the door and begin establishing a credit history. It’s designed for people with bad, limited, or no credit.
When you apply for the FreshStart account you’ll first be considered for the Fingerhut Advantage Credit Account (Review), which is a revolving credit card account that can earn 10% back in rewards at Fingerhut. If you don’t qualify for the Advantage account, you’ll then be considered for the FreshStart account.
After being approved for the FreshStart account you can use it to make a one-time purchase from Fingerhut. Your credit line, or credit limit, will be from $125 to $230. You must place an order of $50 or more, and then pay the required $30 down payment. Then your product will be shipped. You can only place one order with this account.
You’ll be required to make six or eight monthly payments to pay off the balance, accruing interest at a rate of 29.99% APR. After making all of your monthly payments on time, you’ll graduate to the revolving Advantage Credit Account.
You will not graduate to the revolving account if you make a late payment, or if you pay off the entire balance at the same time you pay the initial down payment. You must carry the balance for at least one month and make minimum payments to be considered for the revolving account. This forces you to accrue some interest if you want the revolving account.
There’s no annual fee to use this card. The interest rate is fixed at 29.99%, so carrying a high balance will be costly.
This Fingerhut account, along with Fingerhut’s revolving credit account, will report activity to the three major credit bureaus. This will let you build up your scores, and once you get into the fair or good credit range you’ll be able to qualify for better reward credit cards.
Although the Fingerhut FreshStart program is an installment loan, you can use it to easily get access to a revolving Fingerhut credit account (having a mix of revolving and installment accounts on your credit reports is good for your credit scores). This is a pretty rare opportunity, especially for people with bad credit.