Earn Interest and Rebuild Credit: Webster Bank Secured Visa Credit Card
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If you have had credit problems in the past or are just beginning to build your credit rating, secured credit cards can be helpful tools. A variety of secured credit cards are offered by a number of financial institutions, all providing different benefits and services, while helping you establish or rebuild your credit. (See also: Best Secured Cards for Rebuilding Credit)
If you are working on establishing a positive credit rating, the Webster Bank Secured Visa Credit Card is a simple and straightforward option.
How This Card Works
When you are approved for the card, you must open a secured savings account with Webster Bank and make a security deposit in the amount of $300 to $5,000. Your deposit earns interest while it is held in the savings account, and you are issued a credit card with a credit limit in the amount of your security deposit. You can add to your deposit in $100 increments. Your account status is reported to the credit bureaus, and with responsible management of the card account, can result in a positive credit rating. You may also be considered for an unsecured credit card after 12 months.
Pros
Security deposit earns interest. It is required that you open a secured savings account for your security deposit when you are approved for the card. This account, however, allows you to earn interest on the deposit while it is held, which isn’t an option with all secured credit cards. This gives you a chance to build your security deposit and receive a little extra if you close your card account in the future. (See also: Best Secured Cards that Offer Interest on Your Deposit)
You may qualify for an unsecured card. While your activity is reported to the credit bureaus, the account is periodically reviewed. You could qualify for an unsecured credit card after responsible management of your account for 12 months. When you make your payments on time and stay within your credit limit, you are well on your way to establishing a positive credit history.
Cons
Annual fee. Although annual fees on secured credit cards can be as much as $50 per year, the annual fee of $35 on this card is still among the highest. There are other secured cards that don't have annual fees at all.
High APR. The APR is among the highest APRs charged by credit cards, even secured cards. You do have a grace period so if you pay your balance in full each month, you can avoid paying interest on your purchases. If, however, you typically carry a balance from month to month, can save money by selecting one of the secured cards that offers a lower APR.
Foreign transaction fees. If you plan on using the card for foreign purchases, you will be charged a foreign transaction fee of at least 2%, depending on whether your transaction is made in U.S. Dollars or foreign currency. For travelers, this can be an expensive fee added on to each purchase. There are, however, secured credit cards which do not charge foreign transaction fees.
Who This Card Is Best For
While there are no extra bells and whistles with the Webster Bank Secured Visa Credit Card, it is still a solid option for those seeking a fairly standard secured credit card for building or rebuilding their credit rating. It is ideal for earning interest on the security deposit, and possibly qualifying for an unsecured card in as soon as 12 months. In order to get the most out of the card, however, it is also best for those who are diligent in paying their balances in full each month, and whose purchases are primarily domestic.
Disclaimer: The responses below are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser's responsibility to ensure all posts and/or questions are answered.
