4 Secured Credit Cards That Offer Rewards

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Consumers with poor or nonexistent credit should consider secured credit cards for their spending and credit-building needs. Secured cards have looser credit restrictions and require a security deposit up front to open, but otherwise they operate like traditional credit cards.

With secured cards, your poor or limited credit history won’t necessarily keep you from earning rewards. While most secured credit cards are no-frills affairs, some do offer spending incentives.

Here are four secured credit cards with real rewards.

1. SKYPASS Visa Secured Card

Rewards: One mile for every dollar spent on eligible purchases.

Sign-Up Bonus: 5,000 SKYPASS bonus miles upon your first purchase.

Annual Fee: $50

APR:Variable 17.24% on purchases and balance transfers.

Why We Picked It: Cardholders can earn miles with select airlines.

Benefits: Every purchase earns one SKYPASS mile per dollar. You’ll get 5,000 bonus miles right out of the gate and 1,000 bonus miles every year upon renewal. Points can be redeemed for flights and upgrades with SkyTeam partners—including Delta, Korean Air, and Air France—or for other travel expenses.

Drawbacks: There’s a $50 annual fee, and miles are limited to twenty participating airlines.

2. Best Western Rewards Secured Mastercard

Rewards: Thirteen points for every dollar spent on Best Western stays; two points for every dollar spent on other purchases.

Sign-Up Bonus: 5,000 bonus points upon your first purchase.

Annual Fee: $29

APR:Variable 21.99% on purchases and balance transfers.

Why We Picked It: Frequent Best Western guests can earn points for future reservations and more.

Benefits: Cardholders earn thirteen points per dollar on Best Western stays, with ten points through the Best Western Rewards program and three points for using your card. All other purchases earn double points. Points can be redeemed for Best Western stays, gift cards, merchandise, and more.

Drawbacks: If you aren’t a loyal Best Western guest, this card isn’t for you. 

3. Navy Federal nRewards Secured Credit Card

Rewards: One point per dollar spent on all purchases.

Sign-Up Bonus: None

Annual Fee: $0

APR:Variable 9.99% to 18% on purchases and balance transfers.

Why We Picked It: Navy Federal members can earn points for goodies.

Benefits: All purchases earn one point. Points can be redeemed for gift cards or merchandise.

Drawbacks: You must be a Navy Federal member to access this card. Points expire after four years.

4. AeroMexico Visa Secured Card

Rewards: Two miles for every dollar spent on gas and groceries; one mile for every dollar spent on everything else.

Sign-Up Bonus: 5,000 bonus miles and a companion flight certificate with your first purchase.

Annual Fee: $0 the first year, then $25.

APR: Variable 23.99% on purchases and balance transfers.

Why We Picked It: Frequent AeroMexico flyers can enjoy the miles earned with this card.

Benefits: Gas and grocery purchases earn double miles, and all other purchase earn single miles. Your first purchase earns 5,000 bonus miles and a companion certificate. Plus, you’ll get an additional $99 companion certificate each year you renew.

Drawbacks: If you don’t fly AeroMexico, you won’t see much value in this card.

Choosing a Secured Credit Card with Rewards

Because secured credit cards are primarily intended for consumers with poor or nonexistent credit, building credit should be your primary goal. Rewards should be a secondary concern.

Pay close attention to the fees and APR associated with any cards you’re considering. Annual fees and interest can eat into the overall value of earned rewards.

You’ll also want to evaluate security deposit policies. Many secured credit cards can be opened with as little as $200, and the credit limit will equal your deposit. Some cards may increase your credit limit without requiring an additional deposit after a period of timely payments and responsible card use.

When it comes to rewards, choose a card that rewards your specific spending habits and provides redemption options you’ll actually use.

What Credit Is Required to Get a Secured Credit Card?

Secured credit cards are generally available to consumers with poor or nonexistent credit history, but that doesn’t mean approval is guaranteed. To increase your chances of approval, you should check your credit score before you apply to make sure you meet the requirements. You can check your credit report for free at Credit.com.

Image: istock

At publishing time, the Discover it Secured Credit Card is offered through Credit.com product pages, and Credit.com is compensated if our users apply for and ultimately sign up for any of these cards. However, this relationship does not result in any preferential editorial treatment. This content is not provided by the card issuer(s). Any opinions expressed are those of Credit.com alone, and have not been reviewed, approved or otherwise endorsed by the issuer(s).

Note: It’s important to remember that interest rates, fees and terms for credit cards, loans and other financial products frequently change. As a result, rates, fees and terms for credit cards, loans and other financial products cited in these articles may have changed since the date of publication. Please be sure to verify current rates, fees and terms with credit card issuers, banks or other financial institutions directly.

Source: credit.com

Petal 1 Credit Card Review – Earn Rewards With No Annual Fee

Advertiser Disclosure: This post includes references to offers from our partners. We receive compensation when you click on links to those products. However, the opinions expressed here are ours alone and at no time has the editorial content been provided, reviewed, or approved by any issuer.

The Petal® 1 “No Annual Fee” Visa® Credit Card is an unsecured credit card designed to help new-to-credit consumers build credit. It’s also appropriate for applicants in the midst of rebuilding credit.

Petal 1’s nonexistent annual fee is just the beginning. As one of the best secured credit card alternatives on the market, Petal 1 has a seamless application process and a host of additional features, perks, and capabilities worth mentioning.

If you’re looking for a new entry-level credit card that doesn’t require a security deposit and won’t penalize you for a complicated credit history[1], you owe it to yourself to take a closer look.

Key Features

These are the most important features of the Petal 1 card, a rewards credit card from one of the most innovative credit card issuers around.

Earning Rewards

Earn between 2% and 10% cash back on eligible purchases from select merchants. Once earned, cash back doesn’t expire as long as your account remains open and in good standing.

Redeeming Rewards

Redeem in any amount for a statement credit or for a paper check once your cash-back rewards balance hits $20 (the minimum check amount is $20).

Credit Limit

Depending on your income, creditworthiness (possibly based on your FICO credit scores from the three major credit bureaus), and other factors, your initial credit limit could be as low as $500 or as high as $5,000.

If you’re still building credit and have a complicated credit history, you can still apply for Petal 1.

Important Fees

Petal 1 does not charge an annual fee or fee for international transactions (foreign transaction fees). Possible fees include late fees up to $29 for the first late payment and $40 for any subsequent late payments, and a returned payment fee of $29.

Regular APR

The regular APR for purchases is 19.99% to 29.49%, depending on your creditworthiness, prevailing interest rates, and other factors.

Credit Bureau Reporting

Petal reports Petal 1 account information, including payment history, to all three major consumer credit reporting bureaus. This means responsible use of the card will be added to your credit history and may help to boost your credit score.

Additional Capabilities and Benefits

Additional Petal 1 capabilities and benefits include:

  • A mobile app that makes it easy to manage your funds, track spending, and automate payments on the go
  • Cash flow technology (cash score) that can help earn approval for new-to-credit applicants with bank accounts and adequate banking history
  • Get preapproval within minutes without impacting your credit score

Credit Required

The Petal 1 card is designed for cardholders with average credit (fair credit) as well as new-to-credit consumers with no credit histories and those in the process of rebuilding credit. It’s a suitable student credit card too.


Advantages

These are the Petal 1 card’s top advantages for cardholders.

  1. No Annual Fee. Petal 1 doesn’t charge an annual fee. That’s good news for frugal cardholders and a welcome contrast with some entry-level cards.
  2. No Security Deposit Required. Petal 1 doesn’t require a security deposit as a condition of account opening. This is a key distinction from secured cards, which appeal to the same audience as this one.
  3. Open to New-to-Credit Applicants. Thanks to an innovative underwriting process that considers cash flow and other noncredit factors, Petal 1 is appropriate for applicants without credit histories or with limited credit history.
  4. Ideal for Consumers Rebuilding Credit. Petal 1 may also be appropriate for consumers in the midst of rebuilding credit.
  5. Cash Back on Some Transactions. The Petal 1 card earns between 2% and 10% cash back on purchases with select merchants.
  6. No International Transaction Fee. Petal 1 doesn’t charge a fee for international transactions, so frequent international travelers can use it without fear of surcharges.
  7. Potential for Relatively High Credit Limits. Petal 1 offers credit limits between $500 and $5,000. That’s on the high side for an entry-level credit card.
  8. Regular Credit Bureau Reporting. Petal regularly reports account information to the three major consumer credit reporting bureaus. With timely repayments and responsible credit utilization, your Petal 1 card could help increase your credit score over time.

Disadvantages

Consider these drawbacks before applying for a Petal 1 card.

  1. Potential for High Regular APR. Petal 1’s maximum APR is on the high side. That’s a drawback for cardholders who plan to carry balances from month to month.
  2. No Cash Back on Most Transactions. Despite its attractive cash-back rate on certain partner purchases, Petal 1 doesn’t earn cash back on most transactions. That’s a problem for consumers looking for an everyday credit card that earns rewards.
  3. Credit Limits Capped at $5,000. Petal 1’s maximum credit limit could be problematic for higher-income cardholders.

Final Word

The Petal® 1 “No Annual Fee” Visa® Credit Card is a rarity in the world of entry-level credit cards: a no-annual-fee product that doesn’t require a security deposit and earns cash-back rewards on some transactions.

Although it does have some drawbacks, including the potential for a high APR, it’s a great option for millions of would-be cardholders in the process of rebuilding their credit — and millions more who’ve never had a credit card at all.

Source: moneycrashers.com