Have you had a bankruptcy, foreclosure, or just a history of bad debt? If so, be careful because there are lots of unscrupulous lenders and other predatory companies that will try to take advantage of you.
A prime example is the Horizon Gold card. If you currently have an account or you’re thinking about getting one, this review is a must-read.
Quick Overview for 2017: Horizon is NOT a real credit card. Instead, it is an account you can only use at once place (their website) to buy merchandise. In total, the fees for the card can run as much as $300 or more per year. They even say this on their website, here’s the fine print disclosure:
If you have bad credit, you would be much better off getting a secured card from a major issuer that you can use for purchases everywhere.
When you go to the homepage for Horizon card services, you are taken to a sales pitch for it. In big bold red font they tell you it’s possible to get the following:
Horizon Gold card promised terms
|No credit check|
|Bad credit – OK|
|Fast online application|
|No employment check|
|Reports to major bureau|
That sounds almost too good to be true, right? Well that’s because this is not a bank and you’re not getting a traditional credit card.
How it really works…
1. This is an online retailer, not a bank or a regular credit card issuer
At the top of the page is the “pre-acceptance disclosure” and if you scroll through it you will see for yourself that the Horizon Gold card is merely a line of credit to shop at their own website, called Horizon Outlet (which we’ll discuss in a moment).
This is NOT a Visa, MasterCard, Discover or American Express. You can use this card only for shopping from their online catalog/store.
2. The plan costs $24.95 per month (that’s almost $300 per year!)
They don’t charge interest, instead they just charge you a bunch of fees and sell you overpriced merchandise. The $24.95 is a “Monthly Membership” fee, which is auto-debited monthly. True, secured credit cards will charge you money up-front to secure your credit line. But, if you close the account in good standing, you’ll be refunded that deposit. You’ll never see the money you paid for your “Monthly Membership” fees again.
My guess is that the reason they don’t charge interest is because if they did, it would probably expose them to various credit card regulations. And since they’re not an actual bank, that might make their business model more difficult to get by the authorities that govern real banks.
3. Fees, fees, and more fees
As if paying almost $300 per year for the card wasn’t bad enough, there is a laundry list of other fees and charges which you might experience while using the account:
- One time Card Issuance and Account Validation fee: $5.00
- Fee for returned checks or debits, second NSF: $25.00
- Outlet Store Residential Delivery: $2.00
- Outlet Store Delivery Signature Verification: $2.50
Even after I read all 5,000+ words of the “pre-acceptance disclosure” I’m still confused as to when/if each of these fees is charged. If you already have an account with them, call up their customer service to find out so you don’t get hit with them unexpectedly. Oh, and cancel the card while you have them on the phone.
4. It’s not guaranteed to show on your credit report
The reason a lot of people with bad credit will pay for things like this is because they want to get a fresh start with re-building.
Well, if you’re counting on the Horizon Gold credit card to do the trick it may help. Maybe. On the website, you’ll notice this card reports to “major bureau.” Which “major bureau” is not disclosed. But make sure you read this fine print on the application:
As you see right there, they clearly say they do not guarantee “the posting of any positive references to any credit report.” Now in their defense, rumor has it that they do report the account to TransUnion.
But the fact remains that paying almost $300 per year for the “membership plan,” not to mention all the other fees, is a complete ripoff just to get another account for your credit report. There are much less expensive options available, which I’ll discuss in a minute.
5. The merchandise is overpriced
Personally, I can’t access their shopping site, called “Horizon Outlet,” because in order to see the products you need enter your Horizon card number.
But based on the reviews and feedback I’ve seen posted on the net, their merchandise sounds like it has ripoff prices. Here’s what one customer alleged in a forum post:
What should you do?
You will see many complaints posted online where people allege that the Horizon card is a scam or fraud. Technically speaking, it isn’t. There’s nothing illegal about what this company is doing. So it’s not technically a “scam” but rather just an extremely overpriced credit account designed to take advantage of those without other options. Not to mention that it also has very limited use.
When compared to “real” bank-issued credit cards for bad credit, I see little reason why you would get this quasi-credit card from Horizon Gold. Even the most overpriced cards from First Premier will still probably end up costing you less than this.
But the best option for you is to get a secured credit card. With those, you put up a security deposit which is fully refundable when you close the account (assuming you don’t have any outstanding obligations on the account).
My recommendation? If you wanted to apply for the Horizon card, don’t do it. Just walk away. If you already have one, cancel it as soon as you can. Instead, try out this sponsored tool to see if there are any credit card offers you are pre-selected for. Click below, fill out the form, and see your results. Then you can get a real credit card that can be used anywhere – just use it responsibly and you can grow your credit over time.
Why we gave it 1 out of 5 stars
This ranking is based on our standards for cards for bad credit. Due to its high fees and less-than-ideal terms, this card got a low rating of 1 star.
|Simple/transparent fee structure: This card charges not only a card-issuance fee, but a monthly membership fee as well (which rings up to nearly $300 per year).|
|Grace period: This card charges no interest – as it can be used only for on-site purchases.|
|Rewards: This card offers no rewards.|
|Credit-limit increases: No policy for credit-limit increases in exchange for good behavior.|
|Progress-tracking benefits: This card doesn’t have any credit-tracking tools. In fact, it doesn’t even guarantee that it will report to all three credit bureaus.|
Last updated on Feb. 17, 2017