Q: I need to rebuild my credit and have come to the conclusion that the only way I will be able to do it is with a secured card. I want to compare different offers and was wondering if you could tell me the top 10 secured credit cards to rebuild credit?
A: As you know credit card offers are always changing, but here is a snapshot of what we consider to be the top 10 picks for 2016. The first three are sponsored offers that are often advertised on this site and the others are offers not advertised here, but they are still potentially good options as well. The Capital One Secured card is by far and away the most popular option in the market for the past few years, though.
#1. Capital One Secured Platinum MasterCard (read review)
#2. First Progress MasterCard
#3. USAA Secured Card
#4. Merrick Bank Secured Visa
#5. Centennial Classic Secured Visa
To compare our current sponsored cards, check out these secured credit card reviews.
#6. PenFed credit union secured Visa
#7. Citi secured MasterCard
#8. Navy Federal nRewards Secured Visa
#9. UnionPlus Secured
#10. Bank of America secured Visa
As a general rule of thumb, here are a few different things you should consider when comparing your options…
Fees – Credit cards to rebuild credit are notorious for charging a number of high fees. This is why you need to be especially careful when you’re picking out a secured card. That said, it is possible to find a pretty fair deal out there if you do a little research online. Pay attention to all of the fees potentially included with the account, which could include an annual fee, a monthly fee, a processing fee and even an application fee. If the card issuer mentions any of these fees in the terms and conditions of an offer it isn’t necessarily a show-stopper but you should be aware of them and see how the competition stacks up.
Credit Reporting – Not only should the top 10 secured credit cards do this, but all secured cards should! Unfortunately that’s not how all card issuers work. In the past there have been shady fly-by-night companies that don’t go to the trouble or expense to report their customers’ payment behavior to the credit bureaus. Why? Either because they’re too dysfunctional or they’re too cheap (reporting accounts cost credit card issuers a little bit of money for each account, so they cut corners where they can). So make sure the application you choose clearly states it will be reporting your account history to the credit bureaus.
Account Management – Of course the key to building credit is to maintain a positive account history. Features like text message notifications, online bill pay, and others all make it dramatically easier to stay on top of due dates, watch for unauthorized charges and generally manage your account in a responsible way. In my personal opinion all secured credit cards should offer benefits like this free of charge.
Credit Limits – Another important factor in building credit is having decent sized credit limits. The best secured cards allow you to adjust your credit limit amount to whatever is convenient for you to put on deposit. So even if you start with a small limit of, say, $200, you can increase that to thousands later on once you have the money to do so.