Home > Credit Cards > Discover Just Made it Easier for Secured Credit Cardholders to Upgrade

Comments 0 Comments

[Update: Some offers mentioned below have expired. You can view the current offers from our partners here — Discover it Secured and Capital One Secured MasterCard. Disclosure: Cards from our partners are mentioned below.]

There are credit cards out there for people with bad or thin credit profiles, but most of these cards require you put some money down that serves as — or “secures” — your credit line. The whole thing’s a trade-off. Your issuer feels better about the risk it’s taking and you get some plastic to (hopefully) demonstrate your credit worth. The ultimate goal: Scoring an upgrade to a traditional credit card. Translation: Your security deposit gets returned and (also hopefully) your issuer offers you a higher credit limit.

Well, Discover just made it easier for their secured credit cardholders to reach said goal. This week, the issuer announced that, effective as of Thursday, it would be conducting reviews of Discover it Secured cardholders after seven months of card use instead a year. That means cardholders have to wait a full four months less for the opportunity to transition to a traditional account and have their security deposit refunded.

What’s the Discover it Secured Card?

The Discover it Secured credit card (see full review here) was already one of the better secured credit cards on the market, given it’s one of the few that offers rewards. Cardholders, who are required to put down a minimum of $200 to serve as a matching credit line, earn 2% cash back at restaurants and gas stations on up to $1,000 in combined purchases each quarter and 1% cash back everywhere else. Plus, the card touts Discover it’s cash back match offer, which essentially means cardholders can receive double the points they earned in their first 12 months at the end of that year. The card carries no annual fee and a standard variable purchase APR of 23.24%. The card reports credit behaviors to all three credit bureaus.

Talking Secured Credit Cards

It’s important to note that the Discover it isn’t the only solid secured credit card on the market. Capital One also offers a no-annual-fee Secured MasterCard that grants qualified cardholders access to a higher credit limit with no additional deposit after the first five monthly payments have been made on time. Plus, you can get an initial $200 credit line after making a security deposit of $49, $99, or $200, based on your creditworthiness. The Capital One Secured MasterCard (see full review here) carries a variable purchase APR of 24.99%. You can read more about our picks for the best secured credit cards here.

Remember, it’s important to read the fine print through and through to be sure any credit card you’re considering is right for you. And, even if your credit card isn’t secured, you’ll want to use it responsibly. (Otherwise, you could wind up paying a whole lot of interest and your credit could take a hit. To find out how your financial behaviors are affecting your credit, you can view two of your credit scores, updated every 14 days, for free on Credit.com.)

Responsible credit card use involves paying all of your bills on time. It also means keeping the amount of debt you owe below (ideally) 10% and at least 30% of your total available credit limit(s) — a much taller order when you have a secured credit card with a low credit limit, so all the more reason to aim for that upgrade. If you’re already saddled with bad credit, you can generally improve your scores by paying down existing credit card balances, disputing credit report errors and cooling it when it comes to new credit applications for awhile.

At publishing time, the Discover it and Capital One Secured MasterCard are offered through Credit.com product pages, and Credit.com is compensated if our users apply and ultimately sign up for thiscard. However, this relationship does not result in any preferential editorial treatment.

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.

Image: PeopleImages

Comments on articles and responses to those comments are not provided or commissioned by a bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by a bank advertiser. It is not a bank advertiser's responsibility to ensure all posts and/or questions are answered.

Please note that our comments are moderated, so it may take a little time before you see them on the page. Thanks for your patience.

Certain credit cards and other financial products mentioned in this and other sponsored content on Credit.com are Partners with Credit.com. Credit.com receives compensation if our users apply for and ultimately sign up for any financial products or cards offered.

Hello, Reader!

Thanks for checking out Credit.com. We hope you find the site and the journalism we produce useful. We wanted to take some time to tell you a bit about ourselves.

Our People

The Credit.com editorial team is staffed by a team of editors and reporters, each with many years of financial reporting experience. We’ve worked for places like the New York Times, American Banker, Frontline, TheStreet.com, Business Insider, ABC News, NBC News, CNBC and many others. We also employ a few freelancers and more than 50 contributors (these are typically subject matter experts from the worlds of finance, academia, politics, business and elsewhere).

Our Reporting

We take great pains to ensure that the articles, video and graphics you see on Credit.com are thoroughly reported and fact-checked. Each story is read by two separate editors, and we adhere to the highest editorial standards. We’re not perfect, however, and if you see something that you think is wrong, please email us at editorial team [at] credit [dot] com,

The Credit.com editorial team is committed to providing our readers and viewers with sound, well-reported and understandable information designed to inform and empower. We won’t tell you what to do. We will, however, do our best to explain the consequences of various actions, thereby arming you with the information you need to make decisions that are in your best interests. We also write about things relating to money and finance we think are interesting and want to share.

In addition to appearing on Credit.com, our articles are syndicated to dozens of other news sites. We have more than 100 partners, including MSN, ABC News, CBS News, Yahoo, Marketwatch, Scripps, Money Magazine and many others. This network operates similarly to the Associated Press or Reuters, except we focus almost exclusively on issues relating to personal finance. These are not advertorial or paid placements, rather we provide these articles to our partners in most cases for free. These relationships create more awareness of Credit.com in general and they result in more traffic to us as well.

Our Business Model

Credit.com’s journalism is largely supported by an e-commerce business model. Rather than rely on revenue from display ad impressions, Credit.com maintains a financial marketplace separate from its editorial pages. When someone navigates to those pages, and applies for a credit card, for example, Credit.com will get paid what is essentially a finder’s fee if that person ends up getting the card. That doesn’t mean, however, that our editorial decisions are informed by the products available in our marketplace. The editorial team chooses what to write about and how to write about it independently of the decisions and priorities of the business side of the company. In fact, we maintain a strict and important firewall between the editorial and business departments. Our mission as journalists is to serve the reader, not the advertiser. In that sense, we are no different from any other news organization that is supported by ad revenue.

Visitors to Credit.com are also able to register for a free Credit.com account, which gives them access to a tool called The Credit Report Card. This tool provides users with two free credit scores and a breakdown of the information in their Experian credit report, updated twice monthly. Again, this tool is entirely free, and we mention that frequently in our articles, because we think that it’s a good thing for users to have access to data like this. Separate from its educational value, there is also a business angle to the Credit Report Card. Registered users can be matched with products and services for which they are most likely to qualify. In other words, if you register and you find that your credit is less than stellar, Credit.com won’t recommend a high-end platinum credit card that requires an excellent credit score You’d likely get rejected, and that’s no good for you or Credit.com. You’d be no closer to getting a product you need, there’d be a wasted inquiry on your credit report, and Credit.com wouldn’t get paid. These are essentially what are commonly referred to as "targeted ads" in the world of the Internet. Despite all of this, however, even if you never apply for any product, the Credit Report Card will remain free, and none of this will impact how the editorial team reports on credit and credit scores.



Your Stories

Lastly, much of what we do is informed by our own experiences as well as the experiences of our readers. We want to tell your stories if you’re interested in sharing them. Please email us at story ideas [at] credit [dot] com with ideas or visit us on Facebook or Twitter.

Thanks for stopping by.

- The Credit.com Editorial Team