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When you have a low credit score, it's not easy to find credit cards you can open. Many consumers in this position have gotten offers by mail or online from Credit One Bank, a card issuer specializing in credit cards for bad credit. Before you apply for a Credit One credit card, read this review to find out why this credit card company is considered one to avoid.
Credit One Bank is a credit card company with a poor reputation because of its fees and lack of basic services. It offers credit cards for consumers with bad credit. However, it charges so many fees that it arguably takes advantage of people who don't have many credit card options.
Here are a few examples of the problems with Credit One:
Katrina Niemisto, an SEO Content Strategist at The Ascent, was a cardholder with Credit One Bank and gave a firsthand account of how expensive it can be.
"The biggest surprise for me with Credit One was the fees that kept popping up. I knew it wasn't a great credit card because my limit was only $600, but was still shocked to find that there was a monthly fee and more fees for things like paying your credit card statement. When they offered me an extended limit to $1,500, I thought it would be with the same card. But sure enough, raising my limit opened a SECOND credit card with them. I prioritized paying off these cards and closed them to stop the bleeding from my wallet."
Balance Transfers: N/A
Rewards 1% cash back on gas, groceries, and phone services
Up to 1% cash back
|No minimum credit score||Complicated application process|
|Cash back rewards||Excessive fees|
To be fair, there are a couple of positives to note about the Credit One credit card.
You can get a Credit One credit card with any credit score. This is the card issuer's main draw. If you're working on your credit, a Credit One credit card could be one of the few you can open.
All the Credit One credit cards offer cash back rewards. No matter which card you have, you'll at least be able to earn cash back on some of your purchases.
Unfortunately, Credit One credit cards also have several frustrating drawbacks.
Unlike most credit card companies, Credit One Bank doesn't let you decide which of its cards you want to apply for.
Instead, you first need to go through the prequalification process. This involves filling out a form with personal information so that Credit One Bank can run a soft credit check (which doesn't affect your credit). Based on that, it will show you which cards you prequalify for, as well as their terms and conditions.
A big reason Credit One Bank gets a bad rap is its fees. If you make a free standard payment, it can take up to seven days before that payment is reflected in your available credit. If you want to pay off your balance more quickly, you need to pay $9.95 for an express payment.
Multiple cardholders have also reported a fee for a credit limit increase. The standard amount seems to be $24.99.
When you're rebuilding your credit, it's important to minimize the amount you spend on fees. Credit One credit cards don't help with that. For cards targeted at people with bad credit, that's a major flaw.
Credit One Bank also differs from other popular card issuers in only publishing some of its credit cards' terms and conditions online. The available terms and conditions for some cards are "for information purposes only," which aren't official and provide very broad information.
For example, the Credit One Bank Platinum Visa lists its annual fee as anywhere from $0 to $95 in the first year, and from $0 to $99 after that. In the second year, the fee might also be charged annually or broken down into 12 monthly payments.
There is no minimum credit score required to get a Credit One credit card. However, your credit score will determine the cards and terms you can get. Some of its cards are available to consumers with bad credit. Others require average or excellent credit.
It's unlikely that a Credit One credit card is your only option. Before you apply for one, you should shop around to see what better options may be available. There are other credit cards that are easy to get, such as secured credit cards, store credit cards, and student credit cards. If your credit score is poor, you can start with our list of expert-reviewed best credit cards for bad credit.
You can build your credit with a card from Credit One Bank. But for most consumers, there are alternatives, so it's smart to look for cards that charge fewer fees.
Credit One looks like a decent option on the surface. It has credit cards almost anyone can get. They all earn cash back. You don't need to pay a security deposit to get a card. And its annual fees can be as low as $0 -- if you qualify.
That seems like everything you'd want when you have bad credit. But those highlights don't capture the reality of Credit One credit cards. Here's what you can expect:
If you're considering Credit One credit cards because you have bad credit, secured credit cards are a great alternative. These credit cards require a security deposit upfront, so they're often available to consumers with bad credit. You can get your deposit back when you either upgrade the card or close it.
Here are a few secured cards worth checking out:
If you don't have much credit history yet, you may also qualify for select unsecured credit cards (cards that don't require a security deposit). One such option is the Petal® 2 "Cash Back, No Fees" Visa® Credit Card. Petal lets you link your bank accounts when you apply for this card. It can then use the bill payment history from those accounts to decide whether to approve you.
You don't need to get rid of a Credit One credit card right away. If you already have one, it makes sense to build your credit with it.
If you have a credit card with Credit One Bank, here's what you should do:
Within a year or two, your credit should be good enough that you can qualify for better credit cards. At that point, you should upgrade. After you get a new credit card, cancel your Credit One credit card so you don't need to pay any more of its fees.
To cancel a Credit One credit card, call the card issuer at 1-877-825-3242. Go through the automated menu to reach customer service, and then tell the representative that you want to cancel your credit card.
Here are some other questions we've answered:
Credit One Bank doesn't have a good reputation. It's known for charging excessive fees. These include fees for payments to post more quickly and to raise your credit limit. Unlike most credit card companies, it doesn't publish all of its fees or terms and conditions on its website.
Credit One credit cards have annual fees of up to $99. After the first year, Credit One Bank may charge one annual fee per year or break it down into equal monthly payments. Credit One cards tend to have low credit limits, which can be under $500.
Every Credit One card earns cash back rewards. However, several only offer cash back on eligible purchases. Eligible purchases, in this case, means purchases in select spending categories.
No, our experts don’t recommend Credit One Bank because of its fees and predatory practices. The annual fees that Credit One Bank charges are expensive for what its cards offer. It tacks on fees for services that are free from reputable credit card companies, including express payments and credit limit increases.
We're firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers. The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.
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