Can You Be Denied for a Secured Credit Card and What to Do

You can be denied for a secured credit card, and it's not uncommon. In fact, some people are denied due to having a poor credit history, with over 70% of applicants being rejected.

Secured credit cards are designed for people with poor or no credit, but lenders still have standards to follow. If you've had a history of late payments, collections, or bankruptcies, you may be denied.

The good news is that being denied for a secured credit card is not the end of the road. You can try applying again after improving your credit score or by choosing a different lender.

Curious to learn more? Check out: Keep Getting Declined for Credit Cards

If you're applying for a secured credit card and get denied, it's essential to understand the reasons behind the rejection. One top reason is the inability to pay the required cash deposit.

Applying for too many credit cards over a few weeks or months can lead to multiple hard inquiries on your credit report, causing your credit score to take a hit. This is a common reason for denial, so be mindful of your credit card applications.

Currently being unemployed or having insufficient income history from a new job can also lead to denial. This is because creditors want to ensure you have a stable income to pay back the credit card debt.

A series of missed payments or defaults on previous credit cards and a bankruptcy filed in the past few months can also result in denial. Creditors view this as a sign of poor credit management.

You may not qualify for a secured credit card if you've recently declared bankruptcy. This is because creditors want to see a discharge from bankruptcy before approving your application.

Here are some possible reasons for rejection:

If you're unsure about the reason for your rejection, you can call Bank of America customer service at (800) 732-9194 for further clarification.

If you've been denied for a secured credit card, don't worry, there are still options available to you. You can try to obtain a secured credit card from the same bank where you have a checking or savings account.

It's generally recommended to wait three to six months before applying again if your credit score improves and the issuer who originally denied you is still an option.

To get a secured credit card, you'll need to apply through the issuer's website, by phone, or by mail.

The application process typically requires providing personal and financial information, such as your name, address, social security number, income, and employment history.

Secured credit card issuers may also ask for a deposit, which can range from $200 to $2,500, depending on the issuer and the credit limit you're applying for.

You can expect to receive a decision on your application within a few minutes to a few days, depending on the issuer's processing time.

Some secured credit card issuers may require a credit check, while others may not, so it's essential to check the issuer's website or terms and conditions before applying.

Curious to learn more? Check out: Denied Credit Card Application

If you're denied for a secured credit card, don't worry, it's not the end of the road. You could apply for a different secured card with a higher approval rate.

Becoming an authorized user on someone else’s credit card account might be a viable option. This way, you can benefit from their good credit habits without having to apply for a new card.

Some secured credit cards don't even check your credit when you apply, so you might want to try applying for one of those. You'll only be denied if you don't have a U.S. mailing address, a Social Security number, or enough money to cover the deposit.

Applying for a credit-builder loan can also be a good alternative to a secured credit card. This type of loan can help you build credit while you pay off the loan.

You'll need to get to the bottom of the rejection to make any necessary improvements and qualify in the future.

Related reading: Amazon Secured Credit Card Apply

If you're struggling to get approved for a secured credit card, there are alternative options to consider. You can try finding a co-signer with a better credit score, such as a relative or spouse.

This can be a great option if you have someone in your life with a good credit history who is willing to take on the responsibility of being a co-signer.

However, keep in mind that having a co-signer can also put their credit score at risk if you're unable to make payments.

Another option is to apply for a secured credit card from a company that specializes in borrowers with damaged or poor credit. These cards often come with high fees or a higher interest rate, so be sure to carefully review the terms before applying.

Alternatively, you can try to obtain a personal loan from a lender who specializes in low credit borrowers. Just be aware that the terms may not be favorable, and the more your credit score improves, the better you may find the loan terms.

For another approach, see: How Much Will a Secured Credit Card Raise My Score

If you're struggling to get approved for a regular credit card, having a co-signer can be a game-changer. A relative or spouse with a better credit score can help you get approved for a new credit card application.

You can also explore low credit loan options, but be aware that these often come with high fees or higher interest rates. It's essential to weigh the costs and benefits before making a decision.

Some lenders specialize in borrowers with damaged or poor credit, offering secured credit cards with less stringent requirements. However, these cards may not offer the most favorable terms.

To give you a better idea, here are some alternative options to consider:

You're looking for alternative options to traditional loans, and one of those options is a secured credit card. Not everyone can get a secured credit card, you can be denied if your credit profile is considered too risky by the lender.

Secured cards have more lenient approval requirements, but approval is not guaranteed. Even with bad credit, you can still be denied if other factors are taken into consideration, such as your income.

Curious to learn more? Check out: Secured Credit Card Pre Approval

If you're struggling to get approved for a traditional credit card, you might want to try the secured Self Visa credit card. This card is designed for people who need to build credit, and it's a great option if you're just starting out.

To get the Self Visa credit card, you'll need to sign up for the Self Credit Builder Account, which is a loan in a bank-held Certificate of Deposit (CD) that you pay off in monthly installments.

The payments for the credit builder loan get reported to the credit bureaus, which helps you build credit while you build savings. This is a win-win situation, as you're not only improving your credit score, but also saving money in the process.

To qualify for the Self Visa credit card, you'll need to have $100 or more in your Credit Builder account savings progress, have your account in good standing, and not have previously had the Self Visa credit card.

Check this out: Secured Credit Card Fund with Checking Account

Here are the steps to get the Self Visa credit card:

If you're rejected for a secured credit card offered by a big bank, consider applying to a community bank or credit union. They may have more lenient approval requirements.

Before applying, make sure you understand the requirements for approval to avoid wasting your time. This can result in an unnecessary credit inquiry.

Community banks and credit unions may say yes to your application even if a larger financial institution says no.

Suggestion: Credit Union Secured Credit Card