Do you know the saying, “Too good to be true”? Applied Bank highlights attractive features such as no application fee, guaranteed acceptance, and no credit check. At first glance, the Applied Bank Visa Gold card seems like a no-brainer for people with bad credit who need a secured card. Then, after a little research, that “too good to be true” feeling is validated.

It happens. For one reason or another, some people find themselves drowning in debt that wrecks their credit. In these cases, there's only one way to go, and that's up. At some point, people with bad credit have to start re-building. A secured credit card such as Applied Bank Visa Gold can often help.

Secured Cards vs. Unsecured Cards

Before anyone selects a credit building credit card, they need to understand the difference between unsecured cards and secured ones.

Unsecured Credit Card: An unsecured credit card does not require a security deposit. In other words, the bank attached to the card is willing to front the customer money as "credit" that will have to be paid back. Unsecured cards are usually not granted to people with bad credit; however, there are some exceptions.

Secured Credit Card: A secured credit card is usually the option for people with poor credit who are trying to re-build. Hopefully, after a short and diligent stint with a secured card, these people can progress to an unsecured one. As a general rule, banks set a minimum and a maximum line of credit on secured cards. The customer's security deposit usually determines the line of credit. Carrying a balance on a secured card is counterproductive to the card's purpose. The cardholder must put charges on the card monthly and pay them on time to build credit. Unfortunately, fees often plague secured cards and hinder the customer's financial growth.

Undoubtedly, an unsecured card is preferred, but most people with bad credit have to select a secured card first and build from there. Frequently, cardholders must pay the costs up-front with a security deposit, or sometimes added fees come as a surprise. Neither of these situations is optimum.

As a secured card option, the Applied Bank Visa Gold appears to be a top-notch prospect at first glance. Here is a list of features highlighted on their website:

No application fee

No credit check

Guaranteed acceptance

Refundable security deposit

Credit reporting to all three national credit bureaus

Get approved in less than 60 seconds

Low 9.9% fixed APR

If the above characteristics told the entire story, the Applied Bank Visa Gold might be the best secured card on the market. But let's take a closer look.

Behind the Scenes with the Applied Bank Visa Gold Card

The fact that the Applied Bank Visa Gold card has no credit check, guaranteed acceptance in less than 60 seconds, and no application fee should be seen as a ruse to lure customers rather than a positive. The "we give a card to anyone" policy is not a positive attribute. This fact should be telling you that this lender does not care about its customers' need to build credit. This lender cares about getting its card in anyone and everyone's hands to make money.

The refundable security deposit will be minus any balance you owe, the annual fee, and any other assessed costs. But you will get it back when you close the account.

Applied Bank claims it reports to all three national credit building bureaus; however, several customers who wrote reviews would argue otherwise. Cardholders dedicated to building credit claim to have discovered the monthly reporting to all of the credit bureaus did not always happen.

At first, the 9.9% fixed APR appears to be a stand-out feature of this card. On second thought, you must consider that no one who has this card should be carrying a balance. The Applied Bank Visa Gold card is only for building credit. The way you build credit is to use the card and pay off the balance every month. In this case, the APR is irrelevant, unless you have to carry a balance. What Applied Bank does not highlight is that their card has no grace period. This means interest begins accruing at the time of purchase, not after a 20+ day grace period. Carrying a balance is highly discouraged.

Other Features: The Good and the Not-So-Good

Below are some other details potential cardholders should know.

The initial security deposit for opening the account has a $200 minimum and a $1000 maximum. Cardholders can increase their credit limit at any time by adding additional deposits up to $5000. However, actual customers complained that Allied Bank assessed a fee of as much as $100 when adding to the deposit.

The Applied Bank Visa Gold card advertises online and mobile banking for bill-pay, balance checks, and more. The reality, however, is that the online portal is very basic. Many customers complained that they were charged an "online payment fee" of up to $12. If these claims are valid, this charge is another hidden fee not disclosed by Applied Bank.

The Applied Bank Visa Gold card comes with a hefty $48 annual fee. True, most secured cards play the same “fee game” as Allied Bank by riddling their cards with additional costs. However, $48 is high for a secured annual fee. For comparison, unsecured cards for poor credit usually have a higher annual fee than the Applied Bank Visa Gold card. But they also have fewer additional fees.

What’s Left to Know About Fees

$38 late payment fee

3% foreign transaction fee

Cash advance APR = 9.99% fixed

Cash advance fee = 5% or $5 minimum

$38 returned payment fee

$30 additional card fee

$30 replacement card fee

$30 stop payment fee

$30 cardholder fee

Good News

Despite the mostly negative news surrounding the Applied Bank Visa Gold card, it does have some redeeming qualities. Here's the good news:

The Applied Bank Visa Gold is a safe a secure card with embedded chip technology.

This card has the Visa name, which provides worldwide acceptance.

The Applied Visa Gold card has no penalty APR or over-limit fee.

While the Applied Bank Visa Gold card has some redeeming features, the added fees are exceptionally punishing. In defense of Applied Bank, added fees are the nature of most secured cards. The fact that some costs are hidden and not realized until assessed is no way to do business.

Facing the Truth

Unfortunately, the truth of the matter is some people have no choice but to get a secured credit card. It is often the only way they can climb out of debt. Potential Applied Bank Visa Gold cardholders need to be aware that this card's ease of acceptance is not a positive quality. In all cases of choosing a credit card, make sure you shop around and explore all of your options. If you have to settle on a card with high fees, make sure you understand all of the rules. The goal with any secured card is to build credit to a point where you can move on to a better, unsecured card.

Finally, if you get the Applied Bank Visa Gold card, make sure you follow these rules: pay on time every month and do not carry a balance. The Applied Bank Visa Gold card might be a wolf in sheep’s clothing, but you can make sure you are not fooled.