Home > Credit Score > Fingerhut FreshStart: Could This Program Jump-Start Your Credit?

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Are you trying to rebuild your credit? Fingerhut, an online mail-order retailer, says it wants to help you with its FreshStart program. It’s a new twist on the catalog card or magazine offers of yesteryear.

The program, which involves a special credit card used to shop from Fingerhut’s online product catalog, is designed for customers who don’t have the best credit. If that’s you, FreshStart could give you a second shot at proving your creditworthiness and qualifying for a regular credit card.

But does FreshStart deliver on its claims? First, here’s an overview of the program:

  • Good credit isn’t required. Do you have poor credit? With lenient application requirements, FreshStart could be a way to regain some credit traction.
  • You pay low payments and no annual fee. Unlike many credit cards, FreshStart has no annual fee and the payments tend to be low.
  • You may pay a high interest rate and other costs. If you don’t make your payments on time or don’t pay off the balance in full, you could be subject to FreshStart’s 25.90% annual percentage rate and other costs.
  • Your shopping power is limited. FreshStart lets you shop from Fingerhut’s catalog of products only; you can’t use it anywhere else. And you may be approved for only a small credit limit.
  • It’s not a traditional credit account. Although FreshStart lets you “graduate” to a traditional credit account after you pay off your balance, you don’t build credit with the major reporting agencies while you’re in the program.

How the FreshStart Program Works

How does FreshStart work, exactly? Fingerhut splits the program into three steps: order, pay off, and graduate. Once you’re approved for FreshStart, you place an order from the Fingerhut catalog for an item that costs at least $50 and at most your approved credit limit. You also have to make a $30 down payment. Once Fingerhut processes the order, your item is shipped.

For the next few months (the exact time depends on your program approval), you make payments toward the total balance on your account. Miss any payments and you risk paying late fees (up to $38 per incident) and interest—and you may not be eligible for a regular credit account.

If you adhere to FreshStart rules and pay off your balance, you’ll graduate to a traditional credit card account with WebBank/Fingerhut Advantage. This account lets you shop more often, build credit with the major monitoring agencies, and potentially qualify for credit line increases and other perks.

FreshStart resembles a more legitimate version of “catalog card” programs that are marketed as credit cards for rebuilding credit but can only be used to shop from the issuer’s catalogs. With those offers, the merchandise is often severely overpriced, and customers usually don’t benefit from these programs much because their credit scores scarcely change.

Fingerhut, on the other hand, has a popular catalog dating back to 1952. The catalog currently comprises over 700,000 items, including big brands like Sony, Dell, and KitchenAid. With its focus on issuing small credit limits to buy products, Fingerhut’s FreshStart program is often great for customers who have been turned down for the company’s Fingerhut Advantage credit card. From the company’s standpoint, it’s a brilliant move—shoppers with poor credit aren’t immediately turned away and Fingerhut gains a paying customer.

The Downsides of the FreshStart Program

Now for the costs. We’re concerned that some customers may focus on only the small down payment and monthly payments and lose track of how much they’ve spent in the long run. If you don’t pay off the balance within the set limits, you could pay high interest amounts. You’ll also pay up to $38 for late or returned payments.

Instead of saving money by purchasing an on-sale item, you could end up paying more than the item’s value by the time you pay off the balance. And with a 25.90% APR—which, honestly, is not unusual for a retail card or credit card if your credit is on the lower side—the potential costs could be higher than cards with the average rate of about 13% to 14%.

What’s more, you may not be able to get out of paying at least some interest on purchases. While Fingerhut says you can pay off your balance faster, the terms and conditions include this warning:

However, if you elect to pay your entire balance due at the same time as your down payment, then this will cancel your Loan and you may not be eligible to be considered for a WebBank/Fingerhut Advantage Credit Account. You may not be eligible to be considered for a WebBank/Fingerhut Advantage Credit Account if you die, file for bankruptcy, enter a consumer credit counseling service program, make any past due payments, or have any payments returned unpaid, or if you enter any other negative credit status.

Also, if you don’t read the offer carefully, you might miss the fact that you don’t build credit with any institution other than Fingerhut when using the FreshStart program. You must pay off purchases on time under this program before (possibly) graduating to a regular credit card. FreshStart isn’t designed as a way to build your credit with the major credit reporting agencies but as a way to build credibility with Fingerhut.

FreshStart Program Reviews

What do customers think about the Fingerhut FreshStart program? Unfortunately, when we searched for customer reviews, Fingerhut didn’t return stellar ratings. The FreshStart program has plenty of detractors online. We found several reviews that matched the tone of this one:

I opened a fresh start account. My credit increased due to opening a new account. Great! After paying off my items with every payment being 10 days early they closed and reopened a new fresh start account. Closing accounts decreased my credit by more points than the opening of a new account in the first place.

And this one:

Husband and I both have accounts, I pay at same time with one check and both payment stubs enclosed in envelope. They call me every time I use one check to make payment and say I didn’t make my payment, then charge late charge. Clearly it is marked on the check and both payment stubs are included. I do not always have the extra check that month to send, but regardless it is paid every month, I can’t wait till all accounts are paid and I will be DONE with this company!

Fingerhut also got into some trouble for its habit of using robocalls to solicit customers. A 2014 class action lawsuit against the company claimed that Fingerhut “negligently places multiple calls to consumers’ cell phones using autodialed robocalls, without prior express consent.”

So what’s our final take? If you love the idea of shopping from Fingerhut’s catalog and you can’t qualify for a traditional credit card, you may want to try the Fingerhut FreshStart program as a way to start building credit. It’s a good idea to limit yourself to a small purchase—perhaps something you’d buy anyway—and pay off the balance exactly on the program’s terms. Then Fingerhut may offer you its Advantage credit card that will help you build your credit with the major reporting companies.

If you’re really serious about getting a credit card to rebuild your credit, we recommend you get a secured credit card and pay the balance in full each month. To track your progress over time, you can get your free credit report summary every month on Credit.com.

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  • http://Yahoo.com Diane Dunn

    I need to make a down payment to open my credit thank

  • Rodney Nelson

    I would like to refute some of these erroneus claims. I am about to finish off my FreshStart program through fingerhut and I am highly pleased. Not only because I got to get something nice for the woman I love and make payments. My credit score jumped 9 points after making my first payment to them. After that my credit jumped 36 pts. Ive gone from bad to good credit and qualified for a Zales credit card all by starting out this way. It does help your credit if ALL payments are made on time

    • http://www.Credit.com/ Gerri Detweiler

      That’s great to know Rodney. How exactly did it work for you? I assume you graduated to the Fingerhut card, so that your info will be reported to the credit reporting agencies, correct?

      • Bleusky Label

        Fresh start program reports to the credit agency

      • Chris Schlagal

        i started with 180 freshstart then payed it off in 2 payments now i have 200 for a regular credit account.

        • YepItsMe

          Well, one thing that tells me is that it depends on just how poor your credit is! Mine, I only get $150, but I’m happy with that. I only want to try to get around $50-60 to start.

      • darksavior

        no i will be paying off on the 1st of feb still under fresh start

    • John Iii

      Jumping a whole 9 points had NOTHING to do with Fingerhut. What happened is your bad debts aged enough that improved your score. They don’t report while your under Freshstart. They just prove how little folks actually know about credit.

      • Cjackson

        Fingerhut freshstart does report to the credit agencies.

        • http://www.Credit.com/ Gerri Detweiler

          Cjackson – have you used it? Curious to hear about your experience.

          • Brie Mason Leslie Rylee

            I have fingerhut. They do report to the credit agencies. It’s on my credit report. I have enjoyed my account. And as long as you pay on time and more than the minimum payment the interest is not bad.

          • darksavior

            i just got on fingerhut fresh start and checked my report yesterday and there it was fingerhut

        • YepItsMe

          I wasn’t worried that it would not report elsewhere, as I was just ecstatic I’m getting a new chance. My life sucks so bad, lemons taste sweet. I’m grateful they’re giving me another chance. That they’ll report me as doing well is an exciting added bonus! I never thought I’d have a second chance at improving my credit score, ever since my husband became critically ill and we had to foreclose. We have NO life savings left. So maybe — just maybe — this is the start of something wonderful for us.
          (Does anybody have certain things they recommend in particular? Years ago we bought a little convection oven from them, and we still use it — more than the big one! Any other suggestions? I only want what we NEED.)

      • Steph

        you’re wrong buddy!

      • Crystal

        They are reporting on my credit report freshstart with the fresh start program. My credit went up 47 points immediately and when done with on time payments its gone from 446 to 601. U should research b4 u speak nonsense. There are plenty of blogs that show this program helped them get barclays discover andvece Amex.

  • http://billcollectorshateme.blogspot.com/ Bill Collectors Hate Me

    I agree with Rodney. Fingerhut is a great option to help rebuild credit. I’ve used them solely for that purpose and they have been very helpful in improving my credit score! I highly recommend Fingerhut!

  • http://www.bodymods4u.com/ Amber Adams

    I also have a Fingerhut Fresh Start credit account. Fingerhut’s description for the credit account states that they report to the 3 major credit bureaus. I made my first payment at the end of last month and did notice that my credit score increased 11 points after that first payment and I am sure that is what had to increase my score because I do not have credit anywhere else! The interest rate may be a little higher than other credit companies but Fingerhut does carry some very nice products! Since it also helps build your credit, it is worth paying the higher interest rate, especially if you make a smaller purchase and pay it off after 90 days! I personally contacted Fingerhut concerning the issue of paying your purchase off early and was informed as long as you do not pay it off before 90 days (wait at least 91 days which means make 3 installment payments), it will not affect your ability to get a revolving Fingerhut Credit Account and they will still report to the credit bureaus.

  • http://www.credit.com/ Credit.com Credit Experts

    Teo —
    Your first move should be to write to the credit card company and ask them to correct your account information in their records. (It would be a good idea to do this registered mail.) Then, when they report the account, they should report the correct SSN, that should make it match to your credit report. Please document all your correspondence.

    Give them a couple of months to fix the records, and then request a copy of your credit report to confirm that is it reporting correctly (or to have the wrong SSN removed if it is somehow associated with your name).

    • Susan Ruppert

      Hello–If anyone here wants info on Fingerhut, I have been on the other side of the coin. As a former employee, I would NEVER apply for their account, no matter how bad my credit was—there are always other options. I left because of unethical practices–not illegal, but unethical. I could not follow what they consider to be their best business practices and look at myself in the mirror every day at the same time. I don’t know how anyone could either.

      • George Amsterdambuhd

        I have a question Susan .. Gwynn Theule Mentioned that her daughter had a fingerhut account and paid off the account early. Is it true that I have to continue to spend, pay off, spend pay off in order to keep them from sending negative information to the credit bureaus? What is this $4 that turned into $180 that Gwynn is referring to. I was approved for a $300 limit, I was going to order something tonight and pay it off by fri.. 3 days from now. What would happen if I only want that one item and just pay it off.. will fingerhut close my account with a negative mention to the credit companies? What is it that they do so horribly? I understand the high interest, which i’l take for now to build the credit. but what is going on over there? Thanks for offering your experience to the forum.

  • Monica Brandt

    Can this program help me build good credit

    • John Iii

      No

    • chris

      Yes it has mine. I started with a credit score of a 520 and close to a year later im at a 581 because the do report to the credit agencies

  • Monica Brandt

    I would like to be given a chance to be apart of the fresh start progra

  • RICARDO

    I DID NOT SEE MY FIST MONTHLY PAYMENT AND ITS NOT IN MY TRANSUNION CREDIT REPORT. I HAVR THIS CARD RECENTLY MONTH OR SO AND BOUGH SOMETHING AND PAID IN FULL. LAST WEEK I APPLIED FOR THE WALLMARTCC STORE CARD AND I GOR APPROVED AND ITS ALREADY REPORTING AT TRANSUNION. CAN SOMEONE TELL ME IF HEY REPORT TO TRANSUNION OR NOT OR THEY WILL EVENTUALLY?

    THANKS SO MUCH PLEASE HELP

    • http://www.credit.com/ Credit.com Credit Experts

      Ricardo —
      The people who could answer your questions best would be the credit card issuers. We cannot tell you which credit reporting agencies receive which report. You can — and it sounds like you are — checking your reports yourself (you are entitled to one free one per year from each of the three major credit reporting agencies). But it may well be that you need to give it a bit more time. This post addresses the time it takes for your score to reflect changes:
      Credit Score Updates: How Long Will It Take?

  • Britt Cone

    Not true, Mike West. They now carry tons of brand name items, and they are not “cheap”, “old” or “discontinued”- I have bought two brand name items that were within the normal price range and new on the market. They used to carry cheap junk. Check the website before posting.

  • John Iii

    I don’t think i’m gonna care if i’m turned down when i’m dead.. but eh maybe that is just me

  • http://www.Credit.com/ Gerri Detweiler

    Tavoa – Are you trying to build your credit scores? If so, have you checked what your credit scores are? You can
    get your free credit score here. I’d recommend you get yours and see where you stand. This isn’t the only way to build credit.

  • downtowndcmilan

    You can not expect them to throw you an increase making the minimum payment each month. You have to pay the entire balance the next bill due date. Maybe will have better luck with smaller priced items. It’ll work, Give it a try.

  • Tonia

    I got a vacuum cleaner with the fresh start account. That was Feb 2013. Paid it off, July 2013 they gave me a reg. account with a 250.00 credit line. Now its Dec 2014 and my credit limit with them is 1750! They give credit line increases often, tons of name brand items. Key is to buy when they offer free shipping or you pay way to much!!

    • http://www.Credit.com/ Gerri Detweiler

      Good to know. Thanks for sharing your experience.

  • http://www.credit.com/ Credit.com Credit Experts

    Good to hear it’s working out for you.

  • http://www.Credit.com/ Gerri Detweiler

    Good to know! Thanks.

  • http://www.Credit.com/ Gerri Detweiler

    She might want to try to file a complaint with the Consumer Financial Protection Bureau.

  • Matheia Wrighton

    I was to not expecting to open a fingerhut account but I did I started with the fresh start where I put down 30 and I ordered something small paid that off and now I have a regular fingerhut card and I also check my credit it all so went up by 11points .When I checked my credit report finger hut was up there so I here for they do put it on your credit .I now it did mine. So with that said they do put it on your credit.

  • Jeremy Rodriguez

    About a year ago I applied for a finger hut account. I got approved under the regular card with a 500$ limit. At the time no one else would approve me. I paid above the minimum payment and paid a couple small collections off my report and then I got an offer for capitol one credit card. I also used that responsible with a low balance and paid over the minimum payment each month. After a year I now have a credit limit of 1300 on my finger hut with a 0 balance that still reports on time payments and I have a limit of 1750 on capitol one that started at 1000. I now applied for an amex with my bank and got approved for a 2000 dollar limit. All in all finger hut it’s not the cheapest but it did help me get to where I want to be on track to raising my credit score 150 points in one year.

  • dpartn .

    Most anyone with bad credit has to be aware of the realization that they are going to pay a higher price, or interest rate to reestablish themselves. Finger hut has evolved over time and while yes there are Some items you should clearly stray away from (generally electronics like iPods, cell phones, laptops, etc) because they are overpriced on the site. However there are many many things you can buy for the same price (sometimes even lower) than a more mainstream site. Finger Hut is now part of web bank, so if you treat them right and evolve to a conventional account, over time you will qualify for any credit that Web Bank issues which is quite a lot. And of course it helps your credit in general. This is not a bad account for helping to rebuild your credit. You just have to use it To do that and select the items you choose to buy carefully and understand your goal. Buy items that are not markup items (again, electronics are the big one to avoid) no matter how tempted you are, and stick with the stuff that is normal priced and you will be just fine and build credit too.

  • Rip Sumrall

    So maybe i don’t get it, you really need a $800 TV or shoes or whatever, so badly, you are willing to pay 25% interest? Save then buy with cash, if you can make payments you can save. You don’t need it RIGHT now. We aren’t talking about food here. Credit is the bane of this country not a boon.

    And if you are try to rebuild your credit rating, doesn’t that mean you should avoid credit like the plague? Fail once and learn, fail twice… really? At the rates Fingerhut charges failure is an obvious result.

  • Mzwilsons2flyy

    I started with the fresh start program and my credit score jumped quite a bit. I now have a revolving credit with them and I always make sure to make purchases that I can pay right off. I never use my whole credit limit though as I was told you shouldn’t. And I never purchase anything i cant pay off within 30 days

  • Debbie Abeyta

    Finger hut has been around for years, my grandma had a card she loved it.

  • Heather Carroll

    I went up 53 points just opening a Fingerhut Freshstart account. Keep in mind however, my credit was in very terrible standing with no current open accounts so opening this one account brought it up very high. So yes, freshstart does report!

  • gene davis

    Simply amazing – the $30 down pymt + $5 more with my usual car pymt, bumped my transunion score up 73 points in 1 month. Completely shocked when I checked yesterday.

  • gene davis

    410 to 473 in one month!

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