Your first reaction should be to avoid using the Reflex Mastercard® Credit Card. It’s a high-fee card with low credit limits and high interest rates.
True, it can assist you in establishing or rebuilding credit. Furthermore, issuers who accept applicants with poor credit (FICO scores of 629 or lower) must be compensated for all customers who fail to pay their credit card bills. High fees and rates are used to compensate for this.
Even the credit-strapped have better options.
Celtic Bank of Utah issues the Reflex Mastercard® Credit Card, which is serviced by Continental Finance Co. Continental Finance was described as a subprime credit card company that offers “fee-harvester” subprime credit cards by the federal Consumer Financial Protection Bureau in 2015, when it ordered Continental to refund $2.7 million in illegal credit card fees.
Reflex Mastercard® Credit Card: Basics and benefits
Secured card for people with bad credit.
The annual fee ranges from $75 to $99.
In the first year, there is no maintenance fee. After the first 12 months, the price ranges from $0-$120 per year, billed at up to $10 per month.
The cost of additional cards is $30.
N/A as a welcome bonus.
There aren’t any.
APR: Variable APR between 25.90 and 29.99 percent.
Fee for foreign transactions: 3% (waived for 12 months for those who qualify for a credit limit of $300).
Other advantages include:
All three major consumer credit bureaus receive reports.
When you sign up for e-statements, TransUnion gives you free access to your VantageScore 3.0.
Why you should avoid the Reflex Mastercard® Credit Card — and what you should instead consider
FEES AND MORE FEES
The following are the fees charged by the Reflex Mastercard® Credit Card in the first 12 months:
Fee per year: up to $99.
Each authorized user you add to your account will incur a $30 fee. This is usually free on most cards.
Fee for foreign transactions: 3% of each transaction in US dollars (unless you have a $300 credit limit, in which case the fee is waived for a year).
After the first 12 months, the following fees apply:
The annual fee ranges from $99 to $199.
Monthly maintenance fee: $0 to $120, billed monthly at a rate of up to $10.
Fee for foreign transactions: 3% of each transaction in US dollars.
In short, these fees are prohibitively expensive, especially if you are charged a monthly maintenance fee after the first year.
Instead, you could use a good secured credit card with no annual fees to rebuild your credit. If you keep a good payment history on a secured credit card, the security deposit will eventually be returned to you. With an annual fee, this is not the case.
For example, Capital One’s Secured Mastercard® requires a security deposit, which you can get back with good payment history. The card may accept a deposit as low as $49, $99, or $200 for those who qualify. If necessary, you can pay the deposit in installments. There is no annual fee, and it can lead to a higher credit line in as little as six months.
Alternative cards with no annual fee and no security deposit are available if you have limited or no credit, as opposed to bad credit. Consider the Petal® 2 “Cash Back, No Fees” Visa® Credit Card, which is issued by WebBank and promotes itself as a low-cost option for those seeking to establish credit. Petal’s issuer can also assess creditworthiness using its own underwriting model, which takes into account factors like income, spending, and savings. The annual fee is zero dollars. The card also earns rewards.
If you have average credit (FICO scores of at least 630) instead of bad credit, you have a lot of options other than the Reflex Mastercard® Credit Card.
LOW CREDIT LIMIT IN THE BEGINNING
The card’s initial credit limit is up to $750, but that’s not the whole story, thanks to the fees mentioned earlier.
“Some of these set-up and maintenance fees will be assessed before you begin using your card and will reduce the amount of credit you initially have available,” according to the card’s terms and conditions. For example, if you have a $300 minimum credit limit and a $75 annual fee, your initial available credit will be $225 (or $195 if you choose to have another card).”
So a $500 credit limit could actually be $401 (or $371) right away because the card has already charged you a fee before you even receive it in the mail. On Day One, roughly 20% of your credit limit was depleted, and you’re now in debt.
The annual fee is zero dollars. Your credit limit on the Discover it® Secured Credit Card is determined by a deposit, which can range from $200 to $2,500, giving you plenty of options. It also earns points and has a bonus offer, which is as follows: INTRO OFFER: Discover is offering an unlimited cashback match. At the end of your first year, Discover will automatically match all of your cash back! There are no restrictions on how much you can spend or how much you can earn. There was only a dollar-for-dollar match.
If you have at least fair credit, the Capital One QuicksilverOne Cash Rewards Credit Card may be able to provide you with a higher credit line in as little as six months if you pay your bills on time. It, too, earns points: 1.5 percent back on all purchases. There is a yearly fee, but it is much more tolerable.
UNSECURE IS NOT NECESSARY.
This is marketed as an unsecured credit card, which means you won’t need to put down a deposit like you would with a secured card. (However, you’ll need to come up with at least the annual fee, or you’ll end up paying exorbitant interest.) (I’ll get to that later.)
However, according to the card’s terms and conditions, some applicants will not qualify for an unsecured card and will be required to put down a security deposit, up to the full amount of the credit limit. Before the account could be opened, the deposit would have to be paid. You’ll lose some or all of your deposit if you don’t pay your credit card bill.
HIGH INTEREST RATES SKY-HIGH INTEREST RATES SKY-HIGH INTEREST RATES
It will hurt a lot if you don’t pay your balance in full every month, including the potential $99 annual fee. The card has a variable APR of 25.90 percent to 29.99 percent.
If you plan to carry a balance, the $0-annual-fee DCU Visa® Platinum Secured Credit Card may be a better option because it has a lower APR than many unsecured cards. To be eligible for the card, you must first become a member of that credit union.
A CHECKING ACCOUNT IS REQUIRED
The Reflex Mastercard® Credit Card, like some other cards for people with bad credit, requires you to have a checking account.
Consider the OpenSky® Secured Visa® Credit Card if this is an issue. It doesn’t run a credit check when you apply, and if you don’t have a bank account, you can pay your security deposit with a money order or Western Union. However, there is a $35 annual fee.
Is the Reflex Mastercard® Credit Card right for you?
No, it’s not true. Even with bad credit, there are much better options.
Celtic Bank’s official website