Upgrade Cash Rewards review: The credit card that works like a personal loan

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What if you could enjoy the benefits of both a credit card and a personal loan with one convenient tool? 

The Upgrade Cash Rewards Visa® allows you to charge purchases like a credit card and pay off the balance in installments at a fixed rate. This card promotes responsible credit use and can help consumers pay down their balances efficiently. 

While this card may not be suitable for everyone, it can be a valuable tool for those seeking to build credit and manage their debt responsibly.

How the Upgrade card works

The Upgrade card is not your average credit card. It combines a credit card's flexibility with a personal loan's predictability. When you buy something using your Upgrade card, you're essentially taking out a fixed-rate loan with a set repayment term.

Here's how it works:

1. Based on your creditworthiness, you'll get approved for a credit line ranging from $500 to $25,000.
2. You make purchases using your Upgrade card, just like a regular credit card.
3. Your balance is converted into an installment loan with fixed monthly payments 
4. You make monthly payments until your balance is paid off.

This structure can help cardholders pay down their balance in a predictable manner. 

This unique model offers several advantages over traditional credit cards. First, you'll know exactly how much you must pay each month and when your debt will be fully repaid. Second, you'll often enjoy lower interest rates than variable-rate credit cards. You can also budget more effectively since your monthly payment will remain the same throughout the term. 

You'll generally need a fair credit score or higher to qualify for an Upgrade Visa Card. While those with no credit history may face challenges getting approved, the Upgrade card can be a solid option for individuals with less-than-perfect credit looking to rebuild their score. 

Features of the Upgrade card 

Rewards and fees 

With the Upgrade Cash Rewards card, you can earn unlimited 1.5% cash back on all purchases. You can also earn an extra 10% cash back when you shop through the Upgrade Shopping portal, powered by Dosh®.

For example, if you spend $2,000 with your Upgrade card each month, you’d receive around $30 in cash back every month. That adds up to $360 each year.

These rewards may not be as flashy as some premium credit cards, but they can still add to big savings over time. Since the Upgrade card is designed to help you manage your balance, the focus is more on minimizing costs than maximizing rewards.

Credit lines 

Your credit line will depend on your creditworthiness, income, and debt-to-income ratio. Credit limits typically range from $500 to $25,000, with the potential for increases based on responsible credit use over time.

Installment payments 

When you carry a balance, your debt is converted into a fixed-rate installment loan. You can choose a repayment term that fits your budget, typically 12 to 60 months.

Your monthly payment will remain the same throughout the term, making budgeting easier. Plus, you'll have the flexibility to pay off your balance early without prepayment fees.

“The nice thing about installment credit plans is the opportunity to create your budget with that monthly amount due,” says Dawn-Marie Joseph, founder of Estate Planning & Preservation. “The payment will stay the same until it is paid off. This will allow you to properly budget.”

Interest rate and fees 

In terms of fees, the Upgrade Cash Rewards card has no annual fee, late payment fees, or prepayment fees. But there are a few fees to keep in mind, depending on how you plan on using the card:

• Foreign transaction fee: 3%
• Balance transfer fee: 5%

The Upgrade card comes with a variable APR. Depending on your creditworthiness, you may have a low APR. While these rates may be higher than some low-interest credit cards, they are often lower than those of traditional cards. Plus, the fixed-rate structure offers peace of mind, knowing your rate won't skyrocket due to market fluctuations.

Advantages of the Upgrade card 

The Upgrade Credit Card isn’t designed to blow people away with perks and rewards. However, it offers benefits that make it a solid pick for anyone who racks up large balances and can’t repay them right away.

• Predictable payments and budgeting: One of the main benefits of the installment payment structure is that it can help cardholders budget more effectively. By knowing the total cost of your purchases upfront and having a fixed monthly payment, you can plan your expenses more easily and avoid the temptation to overspend.
• Potentially lower interest charges: Because this card has a fixed term and payment amount, you may pay less interest charges than traditional cards. With credit cards, minimum payments often cover only a small part of the principal, leading to longer repayment periods and higher total interest costs.
• Credit-building opportunities: The Upgrade Card reports your payment activity to all three major credit bureaus (Equifax, Experian, and TransUnion). This can help you build or improve your credit score over time. By making on-time payments and keeping your credit utilization low, you can show responsible credit use and potentially improve your credit score.
• Few fees: Depending on your score, the Upgrade Card offers competitive APRs compared to other credit cards. Additionally, the Upgrade card doesn't charge any prepayment or late payment fees, which can save you money in the long run.

Drawbacks of the Upgrade Card

While the Upgrade Visa Card offers many benefits, there are some potential drawbacks. 

• Limited additional rewards and perks: If you're someone who pays off your balance in full each month, you may find more value in a rewards card that offers higher cash back rates, travel perks, or other benefits.
• Rigid payment structure: The fixed monthly payment structure of the Upgrade card can be less flexible than that of other cards. If your financial situation changes and you need to lower your monthly payment, you won't have that option with Upgrade. It's essential to ensure you can afford the monthly payments before committing to an installment plan.
• Potential for high-interest debt: While the interest rates on the Upgrade card are often lower than variable-rate credit cards, they can still be relatively high for those with less-than-perfect credit. It's important to compare offers and understand the cost of borrowing before deciding if the Upgrade card is right for you.
• No introductory 0% APR offer: Some credit cards offer a 0% APR introductory rate for a set period, typically between 12-18 months. The Upgrade card doesn’t have this option, so you’ll start paying interest immediately if you carry a balance. 

Who is the Upgrade Card best for?

The Upgrade Visa Card is a solid choice for those who:

• Carry a balance on their credit cards and want a structured repayment plan
• Prefer predictable monthly payments and fixed interest rates
• Are looking to build or rebuild their credit score
• Want to minimize fees and avoid common credit card charges
• Value cash back rewards but don't need premium travel perks

The Upgrade Card may be a good fit if you prefer a structured approach to credit and value the predictability of fixed monthly payments. This can be especially helpful if you're working to pay off existing debt or want to avoid the temptation to overspend.

The Upgrade Card can also be a smart tool for building your credit score, as it reports your payment activity to all three major credit bureaus. 

How to apply for the Upgrade card 

Applying for the Upgrade Visa Card is a simple online process. You can check your eligibility without impacting your credit score by using Upgrade’s pre-approval tool.

To qualify, you must be at least 18, have a valid Social Security Number, and provide a physical U.S. address. You'll also need to demonstrate enough income to make your monthly payments.

If you meet these requirements and have a fair credit score or higher, you can complete the online application in just a few minutes. Once approved, you'll receive your Upgrade Visa Card in the mail and can start using it right away.

How we rated this card 

Every credit card review we publish has undergone a rigorous editorial process to ensure accuracy and objectivity.

We rate all credit cards on a 10-point system, with 10 being the highest possible score and 1 being the lowest possible score. We assess each card across several key factors, weighted based on what our research shows matters most to readers like you. Learn more about our methodology here.

Here are some of the factors that influenced this card’s overall score: 

• Approval odds: The Upgrade Cash Rewards Visa® Card stands out for its unique combination of credit card and personal loan features, which can be beneficial for those looking to build credit and manage their debt responsibly. The card's approval odds are solid, with the potential to qualify with fair credit and the option for pre-approval without impacting credit score.
• Fees: The card's fee structure is solid, with no annual fee, security deposit, late payment, or prepayment fees. 
• Credit-building features: The Upgrade card offers regular reporting to all three major credit bureaus and a focus on responsible credit use through its installment payment structure. 
• Credit limits: The credit limits, ranging from $500 to $25,000 with no security deposit required, are competitive among credit-building cards. The potential for increases based on responsible use is also a plus.
• APR: The fixed APR based on creditworthiness can be lower than variable-rate credit cards, but it may still be relatively high for some users. 
• Added perks: Lastly, the unlimited 1.5% cash back on all purchases and extra 10% cash back through the Upgrade Shopping portal are valuable added perks — rare for credit-building cards. 

The bottom line 

Combining the convenience of a credit card with the structure of a personal loan, the Upgrade card can help you manage your debt and build credit.

With predictable monthly payments, lower interest rates, and minimal fees, the Upgrade card is a smart choice for those looking to take control of their card balance. While it may not offer the best rewards or perks, it provides a solid foundation for responsible credit use. 

Editorial disclosure: Opinions expressed are author's alone, not those of any bank, credit card issuer, or other entity. This content has not been reviewed, approved, or otherwise endorsed by any of the entities included in the post.