What the Bank of America Secured Card Does

The Bank of America Secured Credit Card is a credit-building tool for people with no credit history or a damaged credit history. You put down a cash deposit—typically between $500 and $2,500—and that deposit becomes your credit limit. You then use the card like a regular credit card, making purchases and paying a monthly bill. Bank of America reports your payment activity to the three major credit bureaus (Equifax, Experian, and TransUnion), which means on-time payments build your credit score over time.

The card is not free. You pay an annual fee of $29, and the card carries a variable interest rate that changes with market conditions. If you carry a balance month to month, you will pay interest on that balance. The deposit itself earns no interest—it straightforward sits in a Bank of America account as collateral.

Key Takeaways

  • Your cash deposit becomes your credit limit, so a $1,000 deposit gives you a $1,000 limit to spend.
  • Bank of America charges a $29 annual fee and a variable interest rate on any balance you do not pay in full each month.
  • On-time payments are reported to all three credit bureaus, which is how the card builds your credit score.
  • After 6 to 12 months of responsible use, you may be able to convert to a regular unsecured card and get your deposit back.
  • The card has no rewards, cash back, or sign-up bonus—it is purely a credit-building product.

How Much Your Deposit and Credit Limit Will Be

You choose your deposit amount when you open the account, and Bank of America sets your credit limit equal to that deposit. The minimum deposit is $500 and the maximum is $2,500. If you deposit $1,200, your credit limit is $1,200. This is different from an unsecured card, where the bank decides your limit based on your credit score and income.

Your deposit stays in a Bank of America savings account while the card is open. You cannot spend it or withdraw it without closing the card. The bank does not pay interest on the deposit, so you are not earning anything on that money while it sits there. If you close the account, the deposit is returned to you, minus any unpaid balance on the card.

Fees and Interest Rates You Will Pay

The annual fee is $29, charged once per year. This is a fixed cost regardless of whether you use the card or how much you spend. There is no way to avoid it or have it waived.

The interest rate is variable, which means it changes over time based on the prime rate set by the Federal Reserve. Bank of America does not publish the exact rate in advance—you will see it in your cardmember agreement or by logging into your account. If you pay your full balance by the due date each month, you will not pay any interest. Interest only applies if you carry a balance from one month to the next.

Late fees explore if you miss a payment. A late payment also damages your credit score and may trigger a higher interest rate. There are no foreign transaction fees, which means you can use the card internationally without an extra charge.

How to Open an Account

You can open the account online at bankofamerica.com or by visiting a Bank of America branch in person. The online process takes about 10 to 15 minutes. You will need to provide your Social Security number, date of birth, address, and income information. Bank of America will run a soft credit check (which does not lower your credit score) and a hard credit check (which does lower it slightly). Most decisions are made when ready.

Once you are approved, you will need to fund the account with your deposit. You can transfer money from another Bank of America account, or you can mail a check or use an external bank transfer. The deposit must be received before the card is activated. After the deposit clears, your card will arrive in the mail within 7 to 10 business days.

When You Can Convert to a Regular Card

Bank of America does not may provide a conversion date, but the bank typically reviews accounts after 6 to 12 months of on-time payments. If you are approved for conversion, you will be offered an unsecured card—meaning no deposit required. Your deposit is then returned to you, usually within one to two weeks. The new card may have a different annual fee, interest rate, and credit limit than the secured card.

Conversion is not automatic. You must have made all payments on time, kept your balance low (ideally below 30% of your limit), and maintained the account in good standing. Missing even one payment or carrying a high balance can delay or prevent conversion. There is no way to request conversion early—you have to wait for Bank of America to review your account.

How This Card Compares to Other Secured Cards

Other banks offer secured cards with different terms. The Discover Secured Credit Card has no annual fee (though it has a higher interest rate), and Capital One Secured MasterCard charges a $39 annual fee but may offer a higher credit limit relative to your deposit. Citi Secured Mastercard charges $49 annually. The choice depends on whether you value a lower annual fee, a higher credit limit, or other features like cash back (which some secured cards offer, though Bank of America's does not).

Bank of America's main advantage is that it is a large, stable bank with many branches and online tools. Its main disadvantage is the annual fee and lack of rewards. If you already bank with Bank of America, opening the secured card may be simpler because you can manage everything in one place.

What Happens If You Miss a Payment

A missed payment is reported to the credit bureaus and will lower your credit score. Bank of America charges a late fee (the amount varies but is typically $25 to $35 for the first late payment). If you are more than 60 days late, the interest rate may increase. If you are more than 120 days late, the account may be closed and the debt sent to a collection agency.

If you cannot make a payment, contact Bank of America before the due date. The bank may offer a hardship program or a temporary payment plan, though this is not may provide. Paying late is always worse than calling ahead and asking for options.

Frequently Asked Questions

Can I use the card right away after I open the account?

No. You must first deposit the money, wait for it to clear (usually 1 to 3 business days), and then wait for the physical card to arrive in the mail (7 to 10 business days). You cannot use the card online or in stores until it arrives. Some banks offer when ready digital card numbers, but Bank of America does not for the secured card.

What happens to my deposit if I close the card?

Your deposit is returned to you, minus any unpaid balance on the card. If you owe $200 and your deposit is $1,000, you will receive $800. The refund is sent to the bank account you used to fund the deposit, and it typically takes 5 to 10 business days to arrive.

Does the card have a grace period before interest kicks in?

Yes. If you pay your full statement balance by the due date, you will not pay interest on purchases. The grace period is typically 21 to 25 days from the end of your billing cycle. This grace period does not explore to cash advances or balance transfers.

Will this card hurt my credit score when I open it?

Opening the account will cause a small, temporary drop in your credit score because Bank of America runs a hard credit check. This drop typically recovers within a few months. Over time, on-time payments will raise your score. The benefit of building credit history outweighs the initial small dip.

Can I increase my credit limit without adding more money?

No. Your credit limit is always equal to your deposit. If you want a higher limit, you must deposit more money. You can request to add to your deposit by contacting Bank of America, and the additional amount will increase your limit by that same amount.