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One thing I have never been able to understand about the credit card industry is how easily people with low credit scores can be taken advantage of. I’m not talking about paying more in interest rates; I’m talking about the payday lenders, and the scams that are technically robbing already financially struggling people.
As soon as I took a look at the Horizon Gold Card, I immediately thought it was a scam. What immediately triggered my suspicions were the words, “Bad Credit, No Credit? Low Score? No Problem!” Phrases such as these are almost always concealing some sort of scam. Maybe sometimes it’s a financing offer of some sort, but chances are that there are going to be an insane amount of fees and little to no benefit to the cardholder. Let’s take a look at the Horizon Gold Card together to see if my suspicions are correct.
Horizon Gold Card
The Horizon Gold Card is a store card, not prepaid or secured, that reports to the major credit bureaus, requires no credit check, and comes with a guaranteed approval. Sounds great, right? Nope.. My first question is, don’t all cards require some sort of credit inquiry, whether it is a soft or hard credit inquiry? Secondly, a guaranteed approval? How can they guarantee approval to everyone? Lastly, if you look at the fine print on the website it reads very specifically that this card can only be used online at thehorizonoutlet.com. My intuition is screaming dirty rotten scam!
Horizon Gold Card Features:
- $500 unsecured credit limit max
- No credit checks
- Reports to the major credit bureaus( builds credit)
- Additional protection plans, services, and discounts
- Can be used for purchases on their online shopping website
I’m not impressed. Who gets excited about a card that you can only use at one merchant you’ve never heard of before? Prepaid cards are notorious for having high fees, and end up being very costly to the cardholders. We’ll have to see if that’s true in this case as well.
Rates and Fees:
- $5.00 one-time account activation fee
- $25 returned check fee
- $20 late payment fee
- $2.50 delivery fee (unless it’s pizza to my doorstep why would I ever have pay this?)
- Processing fees per each transaction
- $24.95 monthly benefit plan automatic charge every month
- $6.00 monthly maintenance fee (waived if you don’t default on monthly benefit plan. That’s so sweet of them)
This card is scamming everyone. The fees are outrageous and expensive. A cardholder with poor credit doesn’t likely have any extra money lying around to cover fees that they don’t understand. The $24.95 monthly benefit plan has me really concerned. Since this is automatically charged every month, the cardholder will never have the option to opt out. That’s the case even if you don’t use the card that month. That’s sixty cents short of $300.00 in annual fees regardless of card use. That’s only $150.00 shy of the annual fee for the prestigious The Platinum Card® from American Express, which is stacked with rewards that make the annual fee worth it. No thanks Horizon, I’ll keep my $300 so I can shop where I actually want to shop at.
Another point worth mentioning is that this card is not a regular banking product. Their disclosure states that they are not a credit service or organization, banking institution, or insurance company. It further states that they are not affiliated with any of the above organizations or institutions.
Other Cards for Rebuilding Credit
Since the Horizon Gold Card has proven itself to be a pretty terrible credit card product, and isn’t even a credit institution or organization let’s take a look at some alternative options out there for those looking to rebuild their credit score.
Capital One® Secured MasterCard®- This secured credit card offer comes with an APR of 24.99% (Variable), no annual fee, and deposits that can only be made in the amount of $49, $99, or $200, depending on credit worthiness. All Capital One cardholders have free access to credit scores with the Capital One Credit Tracker. This MasterCard secured card can be used anywhere MasterCard is accepted.
Credit One Bank® Unsecured Visa® - No Deposit Required-There are a few versions of this card for bad and fair credit. The annual fee ranges from $0-99, depending on your creditworthiness, and the APR is 16.15% - 24.65% Variable. The main perk of this card is that it will earn cardholders 1% cash back on gas purchases.
Unlike prepaid cards, secured cards can rebuild credit when used responsibly. After spending some time properly managing a secured card, cardholders will gradually begin to see their credit score improve. Once their credit has started to improve after about 6-12 months, cardholders can trade their secured card for cash back rewards.
It’s important to check your credit regularly. Until you have improved your credit score substantially, you’ll want to hold onto that secured card. Application denials can significantly hurt your credit score over time, so monitor your credit often, only apply for cards you’re confident you will get approved for, and continue to pay your bills on-time every month.
* Editorial Note: This content is not provided or commissioned by the credit card issuer. Any opinions, analyses, reviews or recommendations expressed in this article are those of the author’s alone, and have not been reviewed, approved or otherwise endorsed by the credit card issuer. This site may be compensated through the credit card issuer Affiliate Program.
*The content in this article is accurate at the publishing date, and may be subject to changes per the card issuer.