Upgrading from a secured to an unsecured credit card

After using a secured credit card over time, you may be eligible to upgrade to an unsecured credit card. Making sure you consistently pay the balance on time is just one way to help improve your credit scores. 

Learn more about upgrading from a secured credit card to an unsecured card.

What you’ll learn:

• Secured cards require a security deposit to open the account. When you upgrade to an unsecured card, you typically get that deposit back. 

• Upgrading from a secured to an unsecured credit card is sometimes referred to as unsecuring or graduating.

• Unsecuring doesn’t mean your card becomes less secure or safe. It simply means you’ve upgraded to a credit card that doesn’t require a security deposit.

• Each credit card issuer has its own policies and requirements for unsecuring. Additionally, consistently using your secured credit card responsibly is always important.

Over time, you may become eligible to upgrade your secured card to an unsecured card with the same issuer. This process is sometimes referred to as unsecuring, upgrading or graduating. 

A secured credit card is a type of credit card that requires a security deposit to open the account. The terms and amount you pay as a security deposit can vary. With some secured cards, the credit limit will be equal to the security deposit amount. 

The main difference between secured and unsecured cards is the security deposit. Unsecured credit cards don’t require a deposit to open the account. And, many times, unsecured cards offer better rewards, lower fees and lower interest rates.

Each issuer has its own policies, timelines and requirements for upgrading customers to an unsecured card. 

However, there are actions you can take to help improve your credit. And they could put you in a better position for a card upgrade.

Using credit responsibly is a key part of financial health and can help you build credit. Here are a few tips to keep in mind, according to the Consumer Financial Protection Bureau (CFPB):

• Always pay on time. Payment history is a major factor in calculating credit scores. Setting up automatic payments is a simple way to help you avoid late payments, along with any fees and penalties that may come with them. 

• Pay more than the minimum. The CFPB says to pay as much toward your balance as possible. And when you can, paying off your entire balance can help improve your credit scores and help you avoid interest charges. 

• Keep your credit utilization ratio low. Your credit utilization ratio is a measure of how much credit you’ve used versus how much credit you have—typically expressed as a percentage. In general, having a lower credit utilization ratio is better for your credit scores. The CFPB recommends keeping your credit utilization ratio at 30% or less. 

Regularly monitoring your credit is another important part of using credit responsibly. It can help you track your progress and spot any credit reporting errors. 

CreditWise from Capital One is free, even if you don’t have a Capital One credit card. It has tools to help you understand your credit score, keep up with changes to your credit and monitor your personal information. And using it won’t affect your credit scores.

You can also get free copies of your credit reports from AnnualCreditReport.com.

Each issuer has its own policies and requirements for upgrading a secured card to an unsecured card. Some issuers may automatically upgrade your secured card once you become eligible. Others may not. Look into how your issuer handles secured card upgrades, and contact them if you have any questions.

A lender can decide to convert your account from a secured credit card to an unsecured card. Capital One periodically reviews your account to see whether you’re eligible for an upgrade. If you qualify,  you’ll be notified that your card has been upgraded to an unsecured credit card. Paying your bill on time and paying off your entire balance every month can help.

Capital One offers two secured credit cards: 

• Platinum Secured: With the Capital One Platinum Secured card, an initial security deposit of $49, $99 or $200 can open an account with a credit line of at least $200, depending on your credit history. And you can raise the credit limit by depositing more than the minimum amount required.

• Quicksilver Secured: The Capital One Quicksilver Secured card offers cardholders 1.5% cash back on every purchase. With the Quicksilver Secured card, you make a $200 minimum deposit to open an account with an initial credit line of at least $200.

Capital One may refund your deposit if you upgrade to an unsecured card or pay your balance in full and close the account. 

You can check to see whether your deposit has been returned by signing in to your account or looking for it on your next credit card statement.

There isn’t a set timeline for when you can expect to upgrade to an unsecured card. You can look into your card issuer’s policies and requirements. Some issuers, like Capital One, automatically review your account and may upgrade your secured card once they consider you eligible.

Find out more about secured and unsecured credit cards through these frequently asked questions.

With time, using a secured credit card can help put you on a path toward upgrading to an unsecured credit card. 

If you’re new to credit or searching for your next credit card, Capital One can help: 

• See if you’re pre-approved for credit cards without harming your credit scores. 

• If you’re looking to build your credit with responsible use, explore cards for people with fair credit. 

• Monitor your credit report and score with CreditWise. It’s free for everyone, and using it won’t hurt your credit scores.