Poor credit or a short credit history can make it difficult to get the kind of credit card you want. All hope is not lost, though. You can work your way up to a credit card with the kinds of rewards and perks you want by building your credit with a secured credit card.
A lower credit score typically signals to card issuers that issuing you a card may be risky for them. To mitigate this risk, they require security deposits. Once you’ve raised your credit score, it’ll be time to move on from a secured credit card and get your secured card deposit back.
Do I get my deposit back from a secured credit card?
You will get your secured credit card deposit back after the account is closed. Once you’ve increased your credit score with your secured card, you can simply close the secured card account—but you need to understand the risks first. Closing your credit card will increase your credit utilization ratio and may temporarily lower your credit score. If you prefer to avoid that, consider having your secured credit card upgraded to an unsecured credit card with your card issuer. You will still get your security deposit back since the original account will be closed.
When do you get your secured credit card deposit back?
When the time comes for you to close your secured credit card account or upgrade your secured credit card to an unsecured card, the issuer will return your secured credit card deposit. The funds from your deposit typically are returned in the form of a check, a statement credit or funds issued directly into your bank account.
How your funds are returned, and the time it takes to get them back depends on the issuer. For example, with the Capital One Platinum Secured Credit Card, security deposits are returned as a statement credit within two billing cycles once your credit card is upgraded to an unsecured card. Other secured credit cards like the Citi® Secured Mastercard® take up to 30 days to return your security deposit in the form of a check.