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Created to help you repair or build credit, the Secured Mastercard from Capital One has few bells and whistles. There are no rewards and only basic benefits, but with responsible use, it can whip your credit scores into better shape, paving the way towards better cards.
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The information related to Secured Mastercard® from Capital One, Discover it® Secured, and Citi® Secured Mastercard® have been collected by Credit Card Insider and have not been reviewed or provided by the issuer or provider of these products.
We gave the Secured Mastercard® from Capital One 4 out of 5 Stars because it’s an inexpensive way to improve your credit, with some relatively favorable terms.
The Secured Mastercard from Capital One could be a good choice if you’re looking to rebuild your credit or establish a credit history.
This is a secured credit card, which means it requires a security deposit when you’re approved. This deposit will fund your credit limit for the card, up to a maximum of $1,000 for an initial credit limit. You’ll also have a chance to increase your limit beyond that later on.
You won’t earn any rewards for using this card. But that’s the norm for secured cards, which are mainly focused on helping you improve your credit. After using a card like this responsibly for some time, and following good credit practices in general, you’ll increase your credit scores and will be able to qualify for a card that offers points or cash back.
There’s no annual fee, meaning this could be a completely free way to establish a positive credit history. Is this the right card to help get your credit on track? Keep reading to learn more and find out.
If you’re in the market for a card designed for users with bad or limited credit, you may have come across credit cards issued by Credit One Bank.
Be careful, however, not to confuse Credit One with Capital One. Credit One has garnered a negative reputation for its exorbitant fees and opaque terms, while Capital One is generally seen as much more reputable and reliable.
After you’re approved for this card you’ll need to provide a refundable security deposit to fund the credit limit. In your application you must provide details of an authorized bank account for an electronic funds transfer (EFT) to make the deposit.
Your minimum required security deposit will be based on your creditworthiness. The required deposit will be one of the following:
No matter which amount you’re required to deposit, you’ll get an initial credit line of $200. So whether your required deposit is $49, $99, or $200, you’ll always get a $200 credit limit. This is different from most secured credit cards, which provide a credit limit that is equal to the amount you deposit.
$200 is a pretty low credit limit compared to other secured cards, so you should consider depositing more money to increase that, if you can easily afford it. Capital One will allow you to deposit up to $1,000 to fund your initial credit limit.
Having a higher credit limit will make it easier to keep your credit utilization low. You also won’t stress as much about being declined for hitting the limit when shopping. But keep in mind that this deposit will be tied up until you close the account, and there’s a path to a higher credit limit later.
If you can’t deposit the full $1,000 or don’t want to, try to put down whatever you think is reasonable. You’ll have to adjust your spending with the card based on that limit — the higher your limit, the more you can spend in a given statement period before you have to pay it off. If you have a low credit limit it might make sense to only use the card for a few purchases per month, to keep your balance low compared to your limit.
You don’t need to make the deposit all at once, you can make partial payments instead. However, all deposits must be made within 80 days of being approved, and before activating the card.
When approved for the card you’ll be given a unique customer number. You must include this number when making a deposit. Deposits can be made online or by phone, by calling 1-800-219-7931 (online will be easier). To make a deposit online, you’ll need to begin by entering your customer number, zip code, and the last 4 digits of your SSN.
Deposits must be at least $20 each, in whole dollar increments.
You may be automatically considered for a higher credit line after six months.This will be an increase of your initial credit line, which was funded by your security deposit. This increase will not require another deposit, it’s just some extra credit for you to enjoy as a reward for your responsible behavior.
Capital One has a program to let you graduate from this card to an unsecured card, if your creditworthiness improves. But reports indicate that not everyone seems to get an upgrade.
To get your security deposit back you must pay off your account balance in full, and then close the card. Your security deposit will then be refunded to you. If you don’t pay off your balance before closing the card, Capital One will use that deposit to pay off your card balance, before returning the remainder to you.
You won’t earn any rewards with this card, like points or cash back. Instead, it’s designed to give people with bad credit a chance to build a solid credit history over time, improving their credit scores.
Typically, secured cards don’t boast overly impressive benefits. Their main goal is to help you get your credit into better shape. Eventually, you’ll be able to move on to bigger and better credit cards, ones that provide much better perks and benefits.
|Purchase APR||Balance Transfer APR||Cash Advance APR|
|26.99% (Variable)||26.99% (Variable)||26.99% (Variable)|
|Annual Fee||Foreign Transaction Fee|
|Balance Transfer Fee||Cash Advance Fee|
|$0||3% of the amount of the cash advance, but not less than $10|
|Penalty APR||Late Fee||Returned Payment Fee|
|None||Up to $39||None|
As this is a secured card, it’s not surprising to find a high APR. The Secured Mastercard from Capital One has no annual fee, so it doesn’t have to cost you any money at all despite the steep interest rate.
If you simply pay off your balance in full each month, you’ll be able to avoid accruing any interest on your purchases. That will accomplish quite a few things at once:
Paying your balance in full like this is a great strategy, especially if you’re new to credit or trying to rebuild. You can simply set up automatic payments for the full statement balance each billing period, and you’ll be good to go.
When you’re approved for this card you’ll need to make an initial security deposit of $49, $99, or $200, as explained above. The amount you pay will fund your initial credit limit of $200, though you can deposit more if you wish, up to $1,000.
Secured cards aren’t meant to be flashy and rewarding; they’re designed with the sole purpose of helping you build credit. The Secured Mastercard® from Capital One is a perfect example of a card like that.
There are no rewards, and for the most part it only comes with basic benefits. It’s meant to help build your credit, reporting your card activity to the credit bureaus so you can establish a positive history.
It’s not the most exciting card, but use it responsibly and you’ll be on your way to better credit scores. Eventually, as long as you maintain good financial habits in general and succeed in improving your credit, you’ll be able to qualify for rewards credit cards that provide points or cash back.
There are quite a few secured cards out there to help build your credit. The Secured Mastercard from Capital One is a good no-annual-fee option, but check out some other cards that can serve the same purpose, some of which offer rewards too.
You can apply for this card securely on the card issuer’s website. Just follow the link below and you’ll be directed where you need to go. Capital One will check your credit reports with just one or all three of the major credit bureaus.
Many applicants will get an instant decision, but in certain cases it could take a bit longer. In some cases Capital One may request more information from you to process the application.
If approved, you’ll need to fund the credit limit with a security deposit within 80 days. You will be given a minimum required amount to deposit, and this will provide you with a $200 credit limit. You can deposit more to increase your credit limit to $1,000 if you’d like.
You’ll be asked to deposit one of three amounts: $49, $99, or $200.
No matter what you’re asked to deposit, your starting credit limit will be $200. You can deposit more for a higher credit line if you wish, up to $1,000 for a $1,000 credit line.
Need to know more about your security deposit? We’ve got you covered.
You may be automatically considered for a higher credit line after six months. You won’t be asked for another deposit on top of your initial one, either.
There are other secured cards that have different methods of increasing credit limits, like accepting additional deposits. If that sounds more your speed, check out some of our best secured card picks.
If you want to check on your deposit status, reach out to Capital One customer service at 1-800-227-4825.
You can find out more about the ins and outs of the security deposit above.
Yes, your initial deposit is entirely refundable. You’ll need to pay your balance in full and then close out the card in order to get your deposit back.
There are a plethora of other secured credit cards on the market. If Capital One’s card doesn’t do it for you, take a look at some of the best alternatives.
Have you been building credit with this card? How do you like it? What do you think is the best way to build credit? Leave a comment, we’d love to hear your opinion!
Brendan has been writing about personal finance for over eight years, and is now taking on the challenge of bringing high quality credit education to the masses. He makes sure that Credit Card Insider is covering the most important credit topics transparently and precisely, and that we have up-to-date reviews of credit cards so you can find cards that are right for you.
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