Capital One Secured Mastercard Review

Updated: May 14, 2020

capital one secured credit card reviews

The Capital One Secured Mastercard is unique among secured credit cards in that it lets you choose from three different security deposit levels. If your budget is tight, you can get started with a security deposit as low as $49. 

Best for rebuilding a bad credit score, the Capital One Secured Mastercard offers few frills. However, there is no annual fee and no monthly service fee, making it a card you should definitely consider.  

Capital One Secured Credit Card Overview

If you're looking for a robust rewards program or special offers, you won't find them with the Capital One Secured Mastercard. What you will find, however, is a solid secured credit card designed to help you repair a low credit score or establish a credit history from scratch. 

The Capital One Secured Mastercard caters to individuals with less than perfect credit scores, as well as those new to the world of credit. What makes it stand out among other secured credit cards is its three tiers of security deposit options. 

With most secured credit cards, you need at least $200 to get started. With the Capital One Secured Mastercard, however, you can choose to deposit $49, $99, or $200 to start. 

In exchange, you'll receive a $200 credit limit. After five months of on-time payments, Capital One will automatically consider you for a credit limit increase.

It's important to note, however, that the option to deposit less than your credit limit depends on your creditworthiness. If your credit is truly poor, Capital One may require you to come up with the full $200 security deposit.  

A higher credit limit can help improve your credit utilization, which is how much credit you're currently using versus how much available credit you have left. To help improve your credit score, you should aim for a credit utilization rate below 30 percent. 

Additionally, Capital One reports to all three credit bureaus. If you make regular payments on time, this can help boost your credit score in a relatively short period of time. 

How Does the Capital One Secured Credit Card Work?

Because it's a secured credit card, the Capital One Secured Mastercard requires a security deposit. After you've been approved for the card, you must make the security deposit to open your account. 

When you're ready to make your deposit, you can do it over the phone or online. 

Of course, if you're low on cash, coming up with $200 can be a daunting task. Fortunately, one of the unique features of the Capital One Secured Mastercard is that it lets you make payments toward your security deposit if you're unable to pay it all at once. 

With your security deposit in place, Capital One will open your account, so you can begin using your new credit card. Your security deposit is fully refundable, so you'll get the money back when you close your account. 

As you make purchases and pay them off, Capital One will report your payment history to the three major credit bureaus: Experian, Equifax, and TransUnion. 

Pros and Cons of the Capital One Secured Credit Card

Like all credit cards, the Capital One Secured Mastercard has its perks as well as its drawbacks. Here's a look at what you need to know before you apply. 

Pros:

The Capital One Secured Mastercard offers a number of benefits that make it a good choice for credit building. 

  • No annual fee - Unlike a lot of other cards marketed toward those with bad credit, the Capital One Secured Mastercard doesn't charge an annual fee. 

  • No maintenance fee - In addition to the lack of annual fee, there is no monthly service or maintenance fee with the Capital One Secured Mastercard. 

  • No foreign transaction fee - If you do a lot of overseas travel, the Capital One Secured Mastercard is worth looking into. There is no foreign transaction fee with this card, so you won't pay anything extra when you make a purchase abroad. 

  • Get a credit limit that exceeds your security deposit - With most secured credit cards, your credit limit is the same as your security deposit. However, this isn't necessarily the case with the Capital One Secured Mastercard. Depending on your creditworthiness, you may be able to deposit as little as $49 to receive a $200 credit limit. 

  • Option to pay the security deposit in installments - If you're worried about breaking your budget to come up with the security deposit, Capital One offers a solution. You can pay your security deposit in installment payments. These payments must be $20 minimum, and you have 35 days to make enough payments to reach the total security deposit amount due for your account. 

  • Flexibility - The Capital One Secured Mastercard is a real Mastercard credit card, which means it's accepted just about everywhere around the world.

  • Reports to all three credit bureaus - Capital One reports your payment activity to all three credit bureaus, which can help you repair your credit score more quickly.

  • Automatic credit limit increases - As long as you make your payments on time every month for a minimum of five months, Capital One will automatically consider you for a credit limit increase. 

If you're considering applying for the Capital One Secured Mastercard, it's a good idea to review the full rates and disclosures

Cons:

Unfortunately, the Capital One Secured Mastercard isn't without a few drawbacks. Here are the downsides to watch out for.

  • Relatively high APR - The annual percentage rate (APR) is 26.99%, which isn't the most competitive rate out there. You'll want to avoid carrying a balance so you don't rack up a bunch of interest charges. 

  • Bank account required to apply - Capital One requires applicants to have a bank account. This isn't always an option for those who are new to credit or struggling back from a bad financial run. If you lack a bank account, you might have to look for another credit card. 

  • Low credit limit - The Capital One Secured Mastercard gives you a $200 credit limit to start. If you choose, you can deposit as much as $1,000 to increase your credit limit. However, it's possible to find secured credit cards that let you deposit more. On the other hand, Capital One will automatically review your account after five months. Assuming you've made your payments on time each month, you'll be eligible to receive an increased credit limit. 

  • No rewards program - The Capital One Secured Mastercard doesn't come with any kind of bonus or rewards program. This isn't unusual among secured credit cards, but it's possible to find a handful of cards that offer rewards. 

Other Benefits & Features to Know

The Capital One Secured Mastercard offers some other benefits and features that might make it appeal to someone looking to rebuild their credit. 

  • CreditWise - When you get a Capital One credit card, you receive free access to CreditWise credit monitoring from Capital One. This lets you see your Vantage 3.0 credit score on your Apple or Android device.

  • Liability protection - If your card is lost or stolen, you won't pay anything if someone uses your credit card to make fraudulent purchases. 

  • 24-hour card replacement service - There's nothing worse than losing your credit card or having it stolen when you're on vacation in a foreign country. This is where Capital One has you covered. If your card is lost or stolen on a trip, Capital One will replace it within 24 hours. And because you have liability protection, you won't be charged for any unauthorized purchases made with your card. 

  • Price protection - With price protection, Capital One will adjust the price of the items you charge to your card if you find them at a lower price within 60 days of making the purchase. 

  • Option to upgrade to an unsecured credit card - If you pay your bill on time and use your secured credit card responsibly, Capital One might offer you the opportunity to upgrade your account to an unsecured Capital One card. 

Capital One Credit Card Fees

One of the main draws of the Capital One Secured Mastercard is that it doesn't come with a bunch of hidden fees. Instead, its fee structure is basic and straightforward, so you never have to worry about getting a nasty surprise when you view your statement. 

Type of Fee

Amount of Fee

APR

26.99%

APR for cash advances

26.99%

Security deposit (refundable) 

$49, $99, or $200

Annual fee

None

Foreign transaction fee

None

Monthly maintenance fee

None

Cash advance fee

$10 or 3% of the amount advanced, whichever is greater 

Late payment fee

Up to $39

As you can see, the Capital One Secured Mastercard doesn't come with a menu of hefty fees. While its 26.99% APR is on the high end, you can usually avoid paying interest by paying off your full balance each month. 

Who Is This Credit Card Best For?

The Capital One Secured Mastercard is best suited to people looking to rehab a credit score that has suffered due to poor credit use or money mismanagement. It's also a good starter card for those just entering the world of credit. 

In contrast to other secured credit cards, the Capital One Secured Mastercard lets some applicants deposit a fraction of the overall credit limit. For example, you might only need to put down $49 to start off with a $200 credit limit. 

The card is also a good fit for individuals whose budgets won't accommodate a lump sum $200 payment right up front. If you don't have the funds to pay the full security deposit all at once, you can apply to make payments until you've reached your required security deposit. 

Because the Capital One Secured Mastercard has no annual fee and no hidden fees, it's a great option for people committed to rebuilding their credit. Many cards marketed toward those with bad credit punish cardholders by charging high annual fees and expensive monthly service fees. 

With the Capital One Secured Mastercard, you'll never pay costly fees. If you're serious about boosting your credit score, this is a good card to have in your wallet. 

How Fast Will a Capital One Secured Credit Card Raise My Credit Score?

The Capital One Secured Mastercard makes it easy to raise your credit score. With the CreditWise app from Capital One, you can even monitor your score to see how it improves from month to month. 

While it takes time to rebuild a credit score, you should be able to see improvement in a few months, assuming you pay your bill on time every month. 

If you plan on using your credit card to improve your credit score, the best thing you can do is make small purchases on your credit card and then immediately pay them off. Capital One will report this timely payment history to the three major credit bureaus, which will post your on-time payments to your credit report.  

Additionally, Capital One will review your account after five months. If you've paid your bill on time every month, you'll be eligible for an increased credit limit. 

When you add more available credit, this can help your credit utilization. Your goal should be to grow your available credit so that your credit utilization rate is below 30 percent. 

For example, if Capital One raises your credit limit to $1,000, you don't want to carry a balance any higher than $300 on your card.

Capital One Secured Credit Card Reviews

Overall, the Capital One Secured Mastercard receives positive reviews around the web. For example, many cardholders say the card helped improve their credit score, paving the way to an upgrade to an unsecured credit card. 

According to one reviewer, the Capital One Secured Mastercard helped them repair a credit score damaged by youthful money mistakes. The reviewer said they started with a 420 credit score and brought it all the way up to 578 by making small purchases and paying them off. 

Another reviewer said they used their Capital One Secured Mastercard to increase their credit score by 100 points in just two months. 

On the other hand, some reviewers report bad experiences with the Capital One Secured Mastercard. 

For example, one reviewer said Capital One never offered them an option to upgrade their account to an unsecured credit card. However, the reviewer did say that having the unsecured card improved their credit score. 

Another reviewer said they had an overall good experience with the Capital One Secured Mastercard, and that the card helped them improve their credit score. However, they were unhappy with the relatively high APR.  

How to Apply for the Capital One Secured Credit Card

To apply for the Capital One Secured Mastercard, you must be at least 18 years old and maintain a bank account. If you meet these criteria, it's easy to apply in five steps. 

1. Go to the Capital One website - Your first step is to go to the Capital One Secured Mastercard website

2. Select the "apply now" button - Once you're on the main website, click the green "apply now" button. 

3. Fill out the application - This will take you to the credit card application, where you'll be asked to provide some personal information. This includes information about your finances, such as whether you've ever filed bankruptcy and how much income you earn. 

4. Submit the application - When you've filled everything out, submit the application. According to Capital One, it makes every attempt to provide a decision within 60 seconds. 

5. Make your security deposit - Once you're approved for a Capital One Secured Mastercard, you can make your security deposit online. From there, you'll receive your card within two to three weeks. However, in some cases Capital One requires more information about you. If you're asked to send in more information, you can mail it to Capital One. 

Applicants who must provide additional documentation may have to wait between 7 and 10 business days to receive their credit card in the mail.  

Alternatives to the Capital One Secured Credit Card

If you're in the market for a new credit card, it's a good idea to shop around. Here are three alternatives to the Capital One Secured Mastercard. 

1. Discover it® Secured Credit Card

Like the Capital One Secured Mastercard, the Discover it® Secured credit card has no annual fee and no monthly service fee. At 22.99%, the APR is also more affordable than the variable 26.99% you'll pay with the Capital One Secured card. 

The Discover it Secured card is also a rare secured credit card that offers a rewards program. Cardholders get 2% cash back up to $1,000 each quarter on fuel and restaurant purchases, as well as an unlimited 1% cash back on all other purchases. 

The Discover it Secured credit card requires a $200 security deposit, which also serves as the credit limit. Unlike the Capital One Secured card, there is no flexibility on the amount of the security deposit. 

2. Citi Secured Mastercard 

The Citi Secured Mastercard is a good option for those who need a higher credit limit. Unlike the Capital One Secured Mastercard, which caps the maximum security deposit at $1,000, the Citi Secured card lets you deposit anywhere between $200 and $2,500.   

There is no rewards program, but the 22.49% APR is lower than the Capital One Secured card's interest rate. Like the Capital One Secured Mastercard, there is no annual fee and no monthly maintenance fee. 

As an added convenience, the Citi Secured Mastercard also lets you pick your own payment date. This can be a useful perk if you need to schedule your payment due date around your paycheck.  

3. OpenSky Secured Visa

The OpenSky Secured Visa is another good option for credit building. There is no pull on your credit when you apply, which means you won't rack up a hard inquiry on your credit report. 

Additionally, you have the option to make a security deposit ranging between $200 and $3,000. This money is refundable when you close your account. 

There is a $35 annual fee for the OpenSky Secured Visa card. On the other hand, the interest rate is just 17.39%, which is tough to beat. 

How to Get in Touch with Customer Support

If you need to reach customer service, you can contact them by mail or by phone. The phone number is 800-227-4825.

The mailing address for Capital One is:

Capital One

Attn: General Correspondence

P.O. Box 30285

Salt Lake City, UT 84130-0287

Capital One doesn't offer customer support via email or online chat. 

Capital One Secured Credit Card FAQs

Here are some of the most commonly asked questions and answers for the Capital One Secured Mastercard. 

Is the Capital One Secured Credit Card Good?

The Capital One Secured Mastercard is a good credit card for those who want to rebuild their credit score or establish themselves in the credit world. On the whole, the card has a great deal to offer.

In addition to transparent costs and no annual fee, it gives users flexibility when it comes to the security deposit. The option to pay just $49 in exchange for a $200 credit limit is rare among secured credit cards.   

Does the Capital One Secured Credit Card Earn Rewards?

The Capital One Secured Mastercard does not come with a rewards program. If you're looking for a card that offers rewards, it's worth checking out the Discover it Secured credit credit, which gives you 2% cash back on gas and restaurant purchases up to $1,000 every quarter, as well as unlimited 1% cash back on everything else you buy.  

How Often Does the Capital One Secured Credit Card Give Credit Limit Increases?

Capital One will consider you for a credit limit increase after you've made five on-time monthly payments. You don't need to make an additional security deposit to qualify for the higher credit limit. 

What Is the Credit Limit on a Secured Capital One Card?

The initial credit limit for the Capital One Secured Mastercard is $200, and you're eligible for this whether you pay $49, $99, or $200 as your security deposit. 

If you want a higher credit limit, you may be able to deposit as much as $1,000, but you must pay the entire $1,000. 

Cardholders can also receive higher credit limits as long as they make regular payments on time each month. If you establish a positive payment history, it's likely that Capital One will offer you the opportunity to upgrade to an unsecured credit card. 

Conclusion

If you're serious about repairing your credit or establishing credit for the first time, the Capital One Secured Mastercard is a good way to do it. While the 26.99% interest rate is a bit high, the absence of an annual fee and the flexible security deposit make this a great option for people who need an affordable credit card for repairing their credit. 


About the Author


Mike Pearson

Mike is a recognized credit expert and founder of Credit Takeoff. His credit advice has been featured in CNBC, Investopedia, CreditCards.com, Bankrate, Huffpost, The Simple Dollar, Reader's Digest, LendingTree, and Quickbooks. Read more.

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