Executive Summary -
One of the few remaining secured credit card on the market that is targeted at those with bad credit. With Orchard Bank now being taken over by Capital One (and not really being marketed these days), this card is one of the few alternatives for those who have poor credit or have just recovered by bankruptcy.
The Progress Secured Platinum MasterCard® is a secured credit card from Bank Synovus that is specifically for those with no credit history or those with very low credit scores to build up your scores and history. Key issue is how does it compare with other similar cards. Before we have an answer, let find out more about this card in detail.
Fees and Rates - This card has an annual fee of $39. The interest rate is very reasonable at 14.99% and the grace period is 25 days. Like all secured credit cards, your credit limit is determined by how much you deposit with this card (Synovus Bank). The minimum deposit is $300 and you can deposit up to $5,000. The amount that you deposit becomes your credit limit and the deposit acts as a collateral against default. The deposits are FDIC insured, but do not pay interest (like most checking accounts).
Reports To Three Major Credit Bureaus - Most importantly, your payments (hopefully timely ones) are reported to Experian, Equifax and TransUnion. This is very important for those looking to build or rebuild your credit history.
Credit Availability and Payment Hold - Under the terms and conditions of this card, there is a fine print that potential applicants should be aware of. If you make your payments by "guaranteed funds" (defined as money orders, cashiers check or Western Union Quick Collect), your credit availability will be increased the moment the funds are posted to your account.
However, payments via checking accounts or any third party payment system via a checking account could result in a payment hold for 10 days. First Progress claims this is to ensure the the money clears and they are honored. However, some cardholders who wishes to pay via their checking accounts have been surprised by the 10 day hold.
How Does First Progress Compare with Other Secured Cards?
First Progress vs Orchard Bank - Orchard Bank has a secured credit card that targets the same folks as First Progress. The Orchard Bank has a slightly lower annual fee at $35 vs $39 for this card. The APR is also lower at 7.90% (though this may not matter if you pay your bills in full). The minimum deposit is slightly lower at $200. When you apply for the Orchard Bank, you may actually be approved for one of their unsecured cards (which have slightly higher fees). This may or may not be what you are looking for. But overall, these two cards are very similar with Orchard having the slight edge in terms of fees.
First Progress vs First Premier - The First Premier Secured credit card is another competitor in this space. It comes with a $50 annual fee and a 19.99% APR. Hence, from a cost perspective, the First Progress is a better alternative to First Premier.
First Progress vs Applied Bank - Applied Bank has secured card that claims not to charge any annual fee or APR. But they charge a 9.95% monthly fee, which works out to $119.40 a year! I think First Progress compares very favorably to the Applied Bank Card.
First Progress vs Other Main Stream Bank Secured Cards - Many mainstream banks issue secured credit cards as well. But these cards are geared towards folks who have no credit history and who have a bank account with them. If you have bad credit history or have been discharged from bankruptcy, you can never get approved for these cards.
First Progress - Compares Well With Its Peers
Based on the comparisons above, we feel comfortable recommending the Progress Secured Platinum MasterCard® to those looking to build a credit history or to those with very low credit scores. The fees and interest rates are very reasonable. More importantly, they report to the three major credit bureaus.
The one things that you will want to take note of is how you will pay your bills. If you do so via Money Order, Cashiers Check, that will not be an issuer. If you are paying from your bank checking account, it may result in a 10 day holding period. That may influence your decision as to whether to get this card.