Discover It Secured Card Alternatives
As always, you want to look around for your options before signing up with a credit card. Understand and analyze various credit cards and the benefits they bring to the table, before choosing one.
Secured Credit cards are one of the easiest credit cards to get approved for. You need to make sure you get the best deal out of your decisions. Every hard inquiry on your credit report matters. So, use it wisely.
Review: Is The Discover It Secured The Best Credit Card For You
Building a positive credit history and score takes time and diligence. If you’re opening your first credit card or want to rebuild a tarnished credit history, the Discover it® Secured Credit Card is an attractive option if a regular credit card isn’t available to you.
Like other secured credit cards, Discover requires a security deposit equivalent to the credit line you want. So if you pay a $500 deposit, you’ll get a $500 credit line. The deposit is refundable .
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Bottom line: The Discover it® Secured Credit Card is worth considering if you’re new to credit or are working on rebuilding your score, and it’s unique because it earns rewards when most secured credit cards do not.
We’re focused here on the rewards and perks that come with each card. These cards won’t be worth it if you’re paying interest or late fees. When using a credit card, it’s important to pay your balance in full each month, make payments on time, and only spend what you can afford to pay.
Discover It Secured Credit Card Review For 2022
REVIEWED BY:Tricia Tetreault
Tricia has nearly two decades of experience in commercial and federal government lending. Her expertise is highlighted throughout small business loan content on Fit Small Business.
This article is part of a larger series on Best Small Business Credit Cards.
The Discover it® Secured Credit Card is designed for business owners who need to build credit and can make a security deposit of between $200 and $2,500. Discover reports payment and usage history to the major credit bureaus, which means using this card responsibly can help you improve your credit score. It offers cash back on your purchases without charging an annual fee.
How To Make Payments On The Discover It Secured Credit Card
- Online: Just log in to your online account to make an online payment. You may make up to two payments per day, using different bank accounts. You can also use the online bill pay service from your bank account.
- Mobile app: You can use the Discover® mobile app to pay. You can text APP to DISCOV to download the app to your phone.
- Automatic payment: You can set up a recurring monthly automatic payment through your online banking account.
- Via phone: You can pay your credit card by phone by calling DISCOVER or 347-2683 at any time.
- Check by mail: You can also mail in your payment with the payment coupon on your statement.
Discover It Secured Card Fees And Costs
Like most other cards, there are also fees for returned payments, balance transfers, and cash advances.
Avery Campbell is a personal finance writer focusing on credit cards and travel rewards. He holds a law degree, specializing in air and space law.
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How To Redeem Discover Cash Back Rewards
You can redeem the Discover cashback reward by visiting their official website. Take the following steps to redeem your cash back rewards successfully
- You can get statement credit directly to your account.
- An option to avail different gift cards by redeeming your rewards for those gift cards.
- You may choose to donate your cashback bonus to charity.
- There is an option to transfer cash back bonus credit to any account with the same last name.
- You can also pay at any merchant with your cashback bonus. Example : Amazon
- If any of the above doesnt work, call them at 1-800-347-3085. They are available 24/7 with mostly US based customer support service.
One good thing is that the rewards never expire, so there is no rush to redeem cash back. Also, there is no minimum reward redemption limit in Discover which is amazing. For example, Bank of America has a $25 minimum reward redemption limit which is difficult to reach after the sign up bonus, unless you dont use the card for all purchases.
In case of Discover, you can redeem as little or as much as you wish to. Also, you can redeem Discover rewards whenever you like. There are no black out dates or anything with redemption.
You have various options to redeem rewards that includes cash redemption. You can choose between cash reward as statement credit or bank account direct deposit.
This Card Is Best For
- Seeks to maximize cash back earnings across spending categoriesCash Back Strategist
- Motivated to create positive credit historyCredit Builder
This cards an excellent option if you need to establish or rebuild your credit and you spend frequently on gas and dining out, since spending on both will earn you a decent 2% in cash back. Even if you arent a big driver or diner, the 1% cash back on all other purchases can really add up, especially in your first year with the card, when these rewards are matched at the end of the initial 12 months of account opening.
This card also has appeal if youre currently carrying a balance on another card with a high interest rate. If you transfer a balance during the introductory period, you’ll receive an intro APR of 10.99% for 6 months on the balance transfer, which is almost certainly lower than what youre currently paying.
Theres also a nice, albeit modest and one-time, perk if you miss a payment on the card. The $40 fee is forgiven on your first late payment, though not the interest charges youll incur on the balance by not paying it off in full by the deadline.
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Discover It Secured Credit Card Rewards
Cardholders of the Discover it Secured Credit Card earn 2% cash back at gas stations and restaurants on up to $1,000 in combined purchases each quarter . They also earn unlimited 1% cash back on all other purchases automatically.
Discover offers a unique welcome bonus for its new users: In their first year only, new card members will automatically have all the cash back they’ve earned during the first 12 billing cycles matched by Discover. So, if you earned $200 cash back at the end of your first year, Discover will give you an additional $200. There’s no limit on how much cash back Discover will match in the first year, so this could potentially be a large windfall of rewards.
What Credit Score Do You Need For A Discover It Card
Discover does not give you any guideline with a specific minimum credit score for Secure card approval. But, the bar shall be low because you pay a security deposit and only get what you pay for. So, Discover is not taking any risk on your credit.
On the other hand, Discover scrutinizes the information applicant provides. This includes credit history, annual income, bankruptcy info and other info Discover finds useful to influence their decision.
Online Public reviews may give you an idea into what score you need to have before applying for this secure card. For instance, check major credit forums like MyFico or Quora or Reddit for general questions. Some people who left their experience say they were not given the credit card even with a 600 credit score. Also, there are some other reviews where people with 550 to 580 credit score have an approval for the card.
However, there are many conditions apart from the credit score that goes into the credit issuer decision about the applicant. If someone with a current high credit score having past bankruptcy or low income may raise red flag and block approval. So, you cant just go by the credit score alone.
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Discover It Card Public Reviews
Discover It secured credit cards have an overall rating of 4.8/5 on their official website. It is the best card because it gives amazing terms and offers. You can also read Discover It secured credit card reviews on their official website. Some of Discover It secured card reviews are mentioned below.
Triple | California
Great card | Great card for credit redemption if you had credit problems in the past , the secured Discover gives you a chance to graduate to a unsecured card.
Amazing card | Cash on demand is the purpose of having a good credit card Provider.
Kay2 | Michigan
Overall good card | Im so happy Discover finally gave me a chance and Im so pleased with their card. I just wish my card transitioned to an unsecured card already.
Michael31 | Alabama
Definitely recommended | Extremely satisfied with card and customer service. Credit score increase drastically and given credit line increases without requesting Love it
Is The Discover It Secured Credit Card A Good Card
If you are in need of a credit card but your credit score needs some help, Discover it® Secured Credit Card may be a good option.
You will get many of the same perks as a normal unsecured credit card user would get. You also earn rewards, have flexible redemption, and eligible for your deposit back in just 8 months.
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Review: Is The Discover It Secured Credit Card Good For Rebuilding Credit
Very few credit cards for people with bad credit will offer as much as the Discover it® Secured Credit Card. The card provides users with as much as 2% cash back at Gas Stations and Restaurants on up to $1,000 in combined purchases each quarter, 1% unlimited cash back on all other purchases – automatically. Usually, having a subprime means you have to settle for less than stellar options, but the Discover it® Secured Credit Card has changed up the secured credit card scene in a major way.
We recommend individuals only charge purchases to it that they can afford to pay off at the end of each month. Otherwise, any positive effects of the cash back rewards will be eaten away by interest fees, and youll be walking away with a net loss.
Bottom line: The Discover it® Secured Credit Card is one of the best credit cards for rebuilding credit.
Difficulty In Getting Approval
Discover just doesnt approve anyone that applies for the card. They hold themselves to high standards unlike other credit cards primarily marketed to folks with poor credit. Also, it is fair because they have good rewards and no annual fee.
Discover will put a hard inquiry on your credit report if you apply for the card, before they make the decision to approve or deny for the card. Even if you have a credit score above 600, you may get a rejection. You can ask Discover to send their reason of rejection on the mail.
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Discover It Secured Review: Is It A Good Credit Card
Secured credit cards can be a smart way to build good credit, and get access to cheaper financing in the future.
This guide covers everything you need to know about the Discover it Secured Credit Card, including eligibility, fees and how it compares to other secured card options.
Well also touch on the Wise debit card as a great alternative for international spending. Theres no need for a credit check – and youll avoid foreign transaction fees all over the world, making the Wise card up to 4x cheaper than bank cards.
How To Get The Most Out Of This Card
Dont lose sight of what the cards true purpose is: to improve credit. While the rewards are an excellent fringe benefit, avoid using a large portion of your credit limit while youre trying to up your score. Thats because , or how much available credit you use, is a key factor in determining your credit score. Experts recommend keeping it as low as possibledefinitely below 30% of your limit at any point.
For example, if your account were to have the maximum credit limit of $2,500, you should aim to keep your card balance at $750 or below.
Use the card in moderationperhaps stick with gas and dining purchases, since those earn higher rewards. But most importantly, be vigilant about paying off your bill in full each month. With its high APR, carrying a balance for just a month or two on this card could wipe out any cash-back earnings.
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Pays You Back In The First Year
While many cards for building credit charge an annual fee the Discover it Secured doesnt charge an annual fee, and does an even better turn: With the cards valuable cash back rewards program, you can actually earn money back each year by using the card.
We estimate that a cardholder who spends an average amount in each of the cards categories and around $3,600 on the card each year can earn around $62 per year on the card over three years. In other words, the Discover it Secured is far more rewarding than most of its competitors.
What Is The Minimum Required Credit Score For The Discover It Secured Card
The Discover it Secured credit card is intended for people with limited credit histories. Your application will be assessed based on the information you provide which includes your employment status, income, and housing costs, as well as your credit score.
If youre approved for an account, youll need to pay a security deposit, which is the equivalent of your credit line. If you are not approved, Discover will tell you the credit score they received for you, and which bureau the report was provided by, so you can understand why your application was rejected.
Why Get The Discover It Secured Credit Card
- You want a card that helps you build credit and lets you earn valuable rewards in the process.
- Youre looking for a card with a low barrier to entry.
- You want a credit-building card thats going to offer the most value in the long run.
- You want a card that gives you a chance to upgrade if you make timely payments.
- You can afford at least a $200 deposit.
- You want a card thats more forgiving on late payments.
Drawbacks To This Card
- Requires deposit: Because this is a secured card, you will need to have the cash available to put down as a deposit to open the account. A minimum security deposit of $200 is required.
- Limited line of credit: The available credit issued to you will be equal to the size of your security deposit. The maximum credit limit possible is $2,500, but that will vary by individual and will be determined by your income and creditworthiness.
- Intro APR offer: There is an introductory APR offer on balance transfers with this card, but it is not a 0% intro like on other credit cards.
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How Does A Security Deposit Work
Cardholders must deposit at least $200 to their Discover it® Secured Credit Card account. Your credit limit will be equal to the amount of money you deposit.
Afterwards, this card will operate just as any other credit card. Youre not allowed to use your security deposit towards your monthly payments. Instead, the security deposit will be used to pay off your balance in the event that you become delinquent in your obligations. As long as your account remains in good standing, and you pay off all your debts, you can always get the security deposit back by closing your account.
Discover It Secured Card Highlights
This card is popular with consumers for various reasons. Its design helps people rebuild credit to re-establish themselves and their credit profile. On top of it, there is no annual fee. Also, they dont punish people having bad credit with outrageous fees or terms and conditions. And, that is exactly why it is famous among other Secured Credit Cards in the market.
Discover it Secured has zero annual fee, zero maintenance fee every month, and there are no other nasty surprises waiting to hit you with additional fees. This is a total no-nonsense simple product that differentiates itself from other cards in the credit builder category. All terms and conditions and policies are clearly shown to you before you sign the dotted line.
Discover is so much upfront that they let card holders know when they will be eligible for a security deposit refund. Also, they show you clearly when you are eligible to upgrade to an unsecured card.
You need to hold the Secured card for a minimum of 8 months, after which Discover reviews your account to see if you qualify for credit line increase or to convert to an unsecured credit card.
It is a rarity to have both credit card rewards program and secured card and no annual fee together. So, it is definitely a powerful combination amongst credit builder credit cards. Discover card offers generous cash back on some category purchases. Also, it matches all cashback rewards you earn in the first twelve months.
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