The Capital One Secured Mastercard allows business owners to spend responsibly and improve their credit. Unlike most secured cards, though, the Secured Mastercard will allow security deposits of as little as 25% of your limit and won’t charge you an annual fee.
Capital One Secured Mastercard Rates
Even though the Capital One Secured Mastercard requires a security deposit for your credit limit, you will still have to pay interest on any balance you carry from month-to-month. This interest rate will depend on the market Prime Rate, so be sure to check the terms and conditions to get the latest APR information.
Capital One Secured Mastercard Rewards
Because the Capital One Secured Mastercard is designed specifically for building credit, it won’t come with the bells and whistles that other, unsecured cards will come with. As a result, it won’t have a rewards program or a welcome offer. But with responsible spending with this secured card, you’ll be able to access rewards programs in the future with improved credit.
Get the Capital One Secured Mastercard if:
- You’ve got a personal credit score below 550 and need to build credit.
Skip the Capital One Secured Mastercard if:
- Your personal credit score is higher than 550.
Personal Credit Builder
After taking the step of getting a Capital One Secured Mastercard, the next steps to building your personal credit are relatively straightforward.
You’ll spend with the Capital One Secured Mastercard just as you would with any other credit card. You’ll spend as much as you need, as long as you don’t outspend your credit line before paying off your spending.
There’s one crucial difference, though.
And this crucial difference is what make the Capital One Secured Mastercard secured—you have to put down a security deposit for your line of credit.
This crucial difference is also why the Capital One Secured Mastercard is easier to qualify for than any unsecured credit card—the security deposit mitigates the risk that a credit card issuer takes on by issuing a credit card to those with lower credit scores.
Because of this, credit card issuers are more open to extending these secured credit cards to those with lower credit or no credit history at all.
No Annual Fee or Hidden Charges
Most cards targeting business owners with bad or no personal credit tack on high fees, which can be confusing and demoralizing. That’s why this card’s simplicity is like a breath of fresh air.
It has no hidden charges and an annual fee of $0.
The Capital One Secured Mastercard knows it’s a hassle to lock up your cash flow in a security deposit, so it doesn’t hit you with any other unnecessary fees like other cards meant for building credit might.
Smaller Security Deposit
All secured cards require a refundable security deposit, and this secured card is no exception.
But again, this card stands out from the pack.
Unlike most secured cards, which set your credit limit equal to your deposit, the Capital One Secured Mastercard allows for a lower deposit based on your credit score. That means, for example, that a starter line of credit for the Capital One Secured Mastercard could require a security deposit of anywhere from $49, $99 or $200.
Plus, if you want to access even more credit with the Capital One Secured Mastercard, you can increase this limit up to $1,000 by making more than the minimum deposit before account opening.
Security Deposit Installments
Plus, the security deposit comes with even more wiggle room for business owners who are on a fixed income—you’ll be able to put down your security deposit in installments.
If you can’t pay your security deposit upfront, Capital One will let you pay it gradually. And as long as you’ve put down your security deposit in its entirety within 35 days of opening your Capital One Secured Mastercard account, you’ll be good to go.
Inevitable Security Deposit
Like all secured cards, this card requires a security deposit. That can be frustrating for business owners who are in need of credit, but it’s often one of the only options for business owners with credit below 550.
If you qualify for the Capital One Secured Mastercard, the ongoing APR will apply right away. There’s no introductory rate, and the APR will vary with the market rate, but could get pretty high.
When it comes down to it, though, cards targeting business owners with challenged or no personal credit can come with APRs much higher than the Capital One Secured Mastercard’s.
And if you’re paying off your balance every month on time and in full, the interest rate won’t matter because interest won’t accrue on the balance.
Personal Credit Card
As a reminder, the Capital One Secured Mastercard is a consumer credit card unlike the business credit cards that we review on this website.
That means that you’ll get lower lines of credit and that you and you alone are responsible for paying your bills on time.
This detail is very much a double-edged sword.
For one, your responsible spending will be reported directly to personal credit bureaus. However, on the other hand, your irresponsible spending will be reported directly to personal credit bureaus, as well. Your personal credit will either suffer or improve, depending on how responsibly you spend with this secured card.
The key to making this feature work for you?
It’s the key to building your personal credit, in general—making sure to make every payment on time and in full every time and to never outspend your credit limit.
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