What could be improved
In sum, a lot could be improved. While the card could help you build credit, it can also throw you in a maelstrom of debt. Before you apply, here are some weaknesses to consider.
Potentially expensive annual fee
I have a lot of issues with the Milestone Mastercard®, but my biggest grievance is the annual fee. Depending on your creditworthiness, you could pay an annual fee between $35 and $175 to use this card.
Many of the best credit cards for bad credit simply don't charge an annual fee, or, if they do, it's often low, like $35. The Milestone Mastercard® tries to smooth over these high fees by eliminating the security deposit. But truthfully, over the long run, paying a high security deposit might put you in a better situation than paying high annual fees. That security deposit is still your money and -- so long as you pay your bills -- it will eventually come back to you, whereas an annual fee is nonrefundable.
To be clear, paying an annual fee for a credit card isn't always a drain on your finances, as some credit cards offset the fee by packing in extra perks and rewards. But the Milestone Mastercard® is devoid of perks and rewards. It's a bare-bones unsecured card that does what many secured credit cards do at a potentially high cost. It's a last-ditch effort, and definitely not the first credit-building card you should apply for.
Multiple credit card agreements
If you're looking at the Milestone Mastercard®'s website, you won't find any details on annual or monthly fees. It's hard to justify hiding these details, but one explanation is that the Milestone Mastercard® comes in various forms. In fact, according to Milestone's website, there are at least 17 different account agreements for this card, each varying in annual fee, monthly fee, and APR.
To give you an idea of how these cardholder agreements work, let's look at one called Agreement 337. Under this agreement, the Milestone Mastercard® has an annual fee of $175 the first year; $49 thereafter. Starting in your second year, you'll pay a monthly fee of $12.50 ($150 annually). Assuming you have the card for the full second year, you'll pay $199 in total. Between your first and second year, you'll pay $374 in annual and monthly fees -- a full $174 more than the $200 security deposit that most secured credit cards require.
That's simply way too much for a credit card designed to help you build credit. And again -- you won't know your agreement until you apply.
Outrageous monthly fee
If you thought paying an annual fee was bad enough, brace yourself. Depending on which Milestone Mastercard® you get (more on that below), you may also pay a monthly fee on top of it.
The fee varies by cardholder agreement. In some agreements, you won't pay the monthly fee in your first year, but then you'll have to start paying it starting in your second. Other agreements will waive the annual fee, but will charge you a monthly fee that is almost as costly.
For example, in one version of this card (Agreement 339), you don't pay an annual fee, but you'll pay a $14.50 monthly fee ($174 annually) for the first year and $19.25 monthly ($231 annually) thereafter. Assuming you have this card for a year, you're still paying an enormously high annual fee, even if it's charged to you by the month.
No rewards
You'd think a card with annual and monthly fees would at least give you a chance to earn points. Not so. Unlike other credit cards, the Milestone Mastercard® doesn't earn cash back or rewards.
Potentially high APR
The APR on this card is 35.90%. That's extremely high and could put you deep into credit card debt.
