|Credit Building Rating:||3.4 / 5|
|Cost of Membership||3.3|
|Ease of Building Credit||2.8|
In a Nutshell:
This plain vanilla secured card requires an extra large deposit and significant annual fee; but its APR is relatively low for a subprime credit card.
Average cost of membership per year ($3,600 annual spend)
Security deposit required
Initial credit limit
Access to higher credit line?
Other rates and fees
Features: $0 liability, car rental insurance, travel and emergency assistance, extended warranty, Visa discounts, FlexControl tool, ability to choose your payment due date
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You won’t collect any rewards or save a ton of money on fees with this basic credit builder card. But if you’ve got bad credit and are struggling to find a card with a reasonable interest rate, you may want to take a closer look at the U.S. Bank Secured Visa.
Although the Secured Visa’s 18.99 percent is on the high side for a credit card, it’s relatively low for a card that’s designed for consumers with damaged credit. Many competitors, by contrast, charge APRs as high as 24 percent or more.
The U.S. Bank Secured Visa also offers some solid benefits, including car rental insurance and emergency travel coverage. In addition, it offers a unique payment tool that helps you cut debt by customizing your automatic payments.
You may be priced out of this card, though, if you don’t have several hundred dollars in the bank. The U.S. Bank Secured Visa requires an unusually high deposit and charges a substantial annual fee.
Here’s what else you need to know about the U.S. Bank Secured Visa:
Big upfront costs
If you don’t have $300 available to put down as a deposit, then you’ll want to keep looking. U.S. Bank’s minimum $300 deposit is unusually high for a secured card, making it tough for cardholders with tight budgets to qualify.
Many secured cards, by contrast, charge no more than $200. Some cards, such as the Secured Mastercard® from Capital One, allow qualified borrowers to open a card with as little as $49.
Pick a limit, based on what you can afford
On the plus side, U.S. Bank allows cardholders to pick their own credit line by matching whatever amount cardholders put down as a deposit. As a result, you could potentially secure up to $5,000 in new credit. Currently, this is one of the highest limits offered by a secured card.
Having the option to put down a larger deposit and get a matching high limit could significantly boost your credit profile since credit scores tend to benefit from higher credit limits – especially if you keep your balances low. Some secured cards, by contrast, only give you a few thousand dollars in additional credit. Others limit you to just a few hundred dollars.
The U.S. Bank Secured Visa doesn’t offer any rewards, though. So you’ll need to look elsewhere if you’re hoping to earn points or cash back in exchange for spending. If you like U.S. Bank, you may even want to check out their line of secured rewards cards instead.
U.S. Bank offers a number of secured airline cards, such as the AeroMexico Visa Secured card and the SKYPASS Visa Secured card, that award airline miles for every dollar you spend. Those cards charge higher APRs, though. So, if you plan to carry a balance, you may want to stick with a plain vanilla card.
Moderate annual fee
The annual fee on the U.S. Bank Secured Visa isn’t as pricey as the fees charged by some secured cards. For example, some cards charge fees as high as $49. However, at $29 a year, it’s still relatively high. U.S. Bank’s AeroMexico Visa Secured card, by contrast, only charges $25 a year. Other secured cards charge even less.
If you plan to hold onto your card long-term – or if this is your first credit card and you’re just beginning to establish your credit history – you may be better off with a no-annual-fee card. Discover, Citi and Capital One all offer secured cards without annual fees.
A more reasonable APR
One of the biggest selling points for the U.S. Bank Secured card is its comparatively low APR for a subprime credit card. U.S. Bank charges a single APR of 18.99 percent. That’s still high for carrying a balance; but depending on your credit profile, it may be among the lowest APRs you can get.
Many competitors, by contrast, charge single APRs closer to 25 percent. According to our Weekly Rate Report, the average subprime card charges a minimum rate of 24.18 percent. Others charge a wide range of APRs, including much lower minimums. However, relatively few people actually get that lower rate. If you qualify for the U.S. Bank Secured card, by contrast, you’re guaranteed to get 18.99 percent.
The U.S. Bank Secured Visa also stands out for its relatively low fees. It doesn’t charge a penalty rate, so you don’t have to worry about seeing your APR automatically surge to unaffordable levels if you fall behind on bills. It charges just 3 percent to transfer a balance, which is on the low end for a credit card and 4 percent for cash advances.
Its cash advance APR is steep, though, so you’ll want to avoid using this card like an ATM. Otherwise, you could wind up paying a 25.74 percent interest rate – five points more than you’d pay if you charged the same purchases.
U.S. Bank Secured Visa card benefits
U.S. Bank offers a decent suite of benefits as well – particularly for cardholders who could use some extra help managing their balances. For example, it offers a unique FlexControl tool that allows you to customize your automatic payments, based on your bill paying goals. If you want to chip away at your debt throughout the month, you can turn on FlexControl accelerator and schedule extra weekly payments.
The U.S. Bank Secured Visa also offers a limited selection of standard card perks, including:
- Auto rental collision damage waiver – If you charge your rental car to your card, U.S. bank will cover the costs if the car is damaged or stolen. Note, the coverage is secondary and will only kick in case your rental isn’t covered under another policy.
- Travel and emergency assistance – Get 24 access to emergency medical, legal and travel services while you are traveling.
- Extended warranty – U.S. Bank will double the warranty period of items purchased with the card, up to three years and up to $10,000 per claim.
- Visa Discounts – Get discounts and special offers from a selection of online and in-store retailers.
- Zero fraud liability – Get reimbursed for 100% of your losses due to unauthorized use of your account.
- Free credit score – Get a free report of your credit score from TransUnion on a monthly basis, and track your credit score over time.
As long as you can afford the high upfront deposit, you shouldn’t have trouble qualifying for the U.S. Bank Secured Visa card. It’s designed for consumers with damaged credit scores and new cardholders who don’t have a credit score at all.
Why get the U.S. Bank Secured Visa card?
- You have bad credit and want a card with a lower APR.
- You want a basic, no frills credit card, rather than a rewards card.
- You have several thousand dollars saved up and would like to take advantage of the Secured Visa card’s customizable credit limit.
How to use the U.S. Bank Secured card
- Secure a larger credit limit by putting down as much cash as you can afford – up to $5,000.
- Save money on interest charges and improve your overall credit score by limiting your credit card balance or by paying off your charges in full.
- Take advantage of the Secured Card’s FlexControl feature if you’re trying to whittle down your debt. Making payments throughout the month, rather than all at once, can be a useful way to trim your balance more quickly.
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