How to Upgrade a Secured Credit Card to an Unsecured Card

Quick Answer

Many credit card issuers automatically upgrade a secured credit card to an unsecured credit card if you’ve been a responsible cardholder. Requesting an upgrade is also an option.

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A secured credit card is a great option for building or rebuilding your credit history, but at some point you'll likely want an unsecured credit card. Some credit card issuers automatically upgrade a secured credit card to an unsecured credit card. Otherwise, you can request an upgrade.

When to Upgrade Your Secured Card

You can typically qualify for an upgrade after six to 12 months of responsible use, though the exact timing depends on the card issuer. Contact your credit card issuer to find out when you may become eligible to upgrade your secured card.

If you've been using your credit card regularly for several months, consistently paying your full balance on time and your credit score has improved, it may be time to upgrade to an unsecured credit card. However, you may not be ready for an upgrade if you've missed payments, often charge more than you can afford and only pay the minimum each month.

How to Upgrade a Secured Card to an Unsecured Card

While the specific steps for upgrading a secured credit card vary by card issuer, the general process is similar.

1. Use Your Card Responsibly

It's important to use your secured credit card carefully from the time you open your account. The goal is to build a pattern of responsible credit card usage, laying the foundation for upgrading your card.

Using your secured card responsibly means:

  • Paying on time each month as required by your credit card agreement
  • Paying more than the minimum amount due to limit your debt and interest.
  • Staying within your credit limit, which is your maximum spending limit.

Aside from helping you qualify to upgrade your secured card, being responsible with your credit card saves money on interest and fees and helps raise your credit score.

2. Have Good Credit Habits

Being responsible with your secured card is just the start, your overall credit habits also play a role. It's important to avoid opening too many accounts, for example. Your credit score may be impacted each time you apply for new credit.

Your card issuer will check your credit report to see how you're handling your other accounts—even credit cards and loans you have with other companies. Be responsible with all your accounts to build a solid credit history and improve your credit score.

3. Check for an Automatic Upgrade

Many credit card issuers begin monitoring your account for upgrade eligibility after a certain number of months. If you qualify, your card issuer will automatically upgrade your account and notify you of the change.

4. Request an Upgrade if Necessary

If it's been more than 12 months and your card hasn't been automatically upgraded, you can contact your card issuer to request an upgrade. They'll review your account and credit history to determine whether you qualify. Note that certain negative activity, like a recent bankruptcy, may automatically disqualify you from an upgrade.

5. Consider Alternative Options

Not all secured credit cards offer the option to upgrade to an unsecured card, even when you've been responsible with your credit card usage.

Consider applying for an unsecured credit card if you find that you can't upgrade your card even though your credit has improved. While it's not as seamless as upgrading your existing account, you'll have a wider selection of credit cards, potentially with better perks.

Keep your secured card open, even after opening an unsecured card, to avoid a dip in your credit score. Having older accounts helps the length of your credit history, which makes up 15% of your credit score.

How Do You Get Your Security Deposit Back?

Upgrading a secured credit card means your security deposit will be refunded back to you. The timing and method of the refund will depend on your card issuer. Your security deposit may be returned to you as a statement credit to your account, if it's still open. Otherwise, if you close your account with a zero balance, your full deposit will be refunded.

The Bottom Line

Whether you're starting over or starting from scratch, building credit takes time. As you work to improve your credit, periodically check your credit score for free to see your progress.

A secured credit card is a great place to start, or start over. When you're ready for your next credit card, review and compare several options to find the right credit card for you. Open new credit cards slowly to allow yourself to adjust to managing multiple cards. Over time, your responsible habits will help you qualify for better credit cards and loans.