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Best Guaranteed Credit Cards

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Guaranteed

The Capital One Guaranteed Secured Mastercard gives you an effortless way...
  • $59
    Annual fee
  • $0
    Welcome Bonus
  • 0%
    Rewards Rate
  • Min.Credit:
                        
  • Rating: no reviews
The Capital One Low Rate Guaranteed Mastercard is one of the best Capital...
  • $79
    Annual Fee
  • $0
    Welcome Bonus
  • 0%
    Rewards Rate
  • Min.Credit:
                        
  • Rating: no reviews

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Guaranteed Credit Cards

Credit cards are convenient. Checking into a hotel or booking an airline ticket is a more straightforward process with one. However, not everyone can get a credit card. That’s where guaranteed credit cards come in.

What is a Guaranteed Credit Card?

A guaranteed credit card offers guaranteed and near-instant approval. This is because they often have few requirements. Also, as a condition of approval, all you may need to do is put down a security deposit as low as $50.

Most credit cards require good to excellent credit. However, a guaranteed credit card doesn’t focus on your credit score. So, with a guaranteed credit card, Canadians without good credit can enjoy the benefits of having a credit card.

While they may not have the glitz and glamour of other credit cards, guaranteed credit cards have unique perks. For instance, they can help you rebuild your credit score.

How Guaranteed Credit Cards Work

Like a regular credit card, a guaranteed credit card requires you to apply with a credit card provider. You may have to put down a security deposit if your credit is not ideal. However, you may not need to if you have decent credit.

After you post the deposit, the credit card company will issue your guaranteed credit card. You can then use it like a regular credit card.

Pros and Cons of Guaranteed Credit Cards

While guaranteed credit cards differ from one credit card provider to another, they have some common advantages and benefits.

guaranteed credit cards 2 - comparewise

The Pros of Guaranteed Credit Cards

  • Low or no annual fee. Guaranteed credit cards offer annual fees as low as $39 or none. This makes it the perfect card to have when you're looking to minimize your credit card debt.
  • No perfect credit is required. Any Canadian with bad credit can apply for the credit card and receive near-instant approval. Your credit score will only determine if you need to make a security deposit.
  • Credit score improvement. As long as you make your payments on time, you can improve your credit score when using your guaranteed credit card.

The Cons of Guaranteed Credit Cards

  • High-interest rates. Unlike regular credit cards, some guaranteed credit cards have higher interest rates. This often applies when you miss a payment. A credit card issuer will increase the interest rate to offset the risk.
  • Low credit limits. You won't receive an extensive credit line, especially if you have poor or non-existent credit.
  • Few features and benefits. Most guaranteed credit cards offer basic features. They rarely have rewards benefits.

Choosing the Right Guaranteed Credit Card for You

Finding the ideal guaranteed credit card for you is simple. Consider the following pointers.

  1. Ensure the credit card company reports payments to the credit bureaus. If you’re using a guaranteed credit card to improve your credit score, you need your credit card activity reported. Without reports sent to Equifax or TransUnion, it defeats the purpose of a guaranteed credit card.
  2. Weigh the interest rates against the annual fee. A credit card with a low or no annual fee often has a high-interest rate. A credit card with a high annual fee often has a low-interest rate. Consider going for a card with a low or no annual fee and high interest instead. Interest is only charged when you carry a balance. However, opt for the low-interest option if you think you'll run a balance you can't pay off by the end of the month.

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Offers shown here are from third-party advertisers. We are not an agent, representative, or broker of any advertiser, and we don’t endorse or recommend any particular offer. Information is provided by the advertiser and is shown without any representation or warranty from us as to its accuracy or applicability. Each offer is subject to the advertiser’s review, approval, and terms. We receive compensation from companies whose offers are shown here, and that may impact how and where offers appear (and in what order). We don’t include all products or offers out there, but we hope what you see will give you some great options.

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March 17, 2022
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FAQs about
Guaranteed Credit Cards

Is a Guaranteed Credit Card Different from a Secured Card?

A guaranteed credit card is similar to a secured card in some ways. The primary difference between the two comes down to the security deposit. With a guaranteed credit card, it’s optional to put down a deposit, whereas, with a secured card, it’s always required.

Also, you often don’t have to match the security deposit with the credit line of your guaranteed credit card. With a secured card, your security deposit must equal the credit line.

Who Should Get a Guaranteed Credit Card?

Anyone who has poor or non-existent credit. A guaranteed credit card offers a chance to build your credit, with near-instant approval available for all applicants. You can then enjoy all the conveniences of owning a credit card.

Can a Guaranteed Credit Card Really Improve My Credit Score?

Yes, it can. As long as you use your card responsibly and make payments on time, your credit score will improve. Your credit card provider will report your payment history to the credit bureaus every month.

What Happens to My Security Deposit?

Your credit card provider will store your security deposit in a separate collateral account. Depending on the company, they may pay a small amount of interest on your security deposit. This interest earned is often credited to your account.

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