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Fingerhut is a catalog and online retailer that sells a little bit of everything, from toys to electronics. Sort of like Amazon.. but with much higher prices in many cases.
When you shop at Fingerhut, you’ll notice that prices are usually higher than other retailers like Amazon and Target (compare this TV at Fingerhut vs the same TV on Amazon which is listed for 20% less).
The most prominent price is the price per month, assuming you buy on credit. The ability to pay on credit and make monthly payments is what distinguishes Fingerhut from other retailers. Fingerhut markets their service as a way to establish credit or rebuild your credit when other retailers deny you for a credit card.
Is really a viable option for building credit? Let’s find out…
Is Fingerhut Credit Legitimate?
Fingerhut resembles a “catalog card” program, although it’s a legitimate version of the type you may have seen elsewhere that are designed to rebuild your credit while shopping from the card issuer’s catalog.
Unlike most programs, Fingerhut does have a popular catalog of items and it has been around for decades.
Fingerhut offers a “Fresh Start program” which is designed for people who want to shop and get what they want now while building their credit and buying power over time. (For alternatives, see our list of best credit cards for building credit.)
Fresh Start is a one-time purchase installment loan that requires a low down payment before your order ships.
You will get six months to pay off the remainder of your balance in equal payments, and get a MetaBank/Fingerhut Credit Account with a larger credit line once your balance is paid off.
Here is a look at some of the Fresh Start fine print:
If you complete the Fresh Start program, your Fingerhut Credit Account will have a limit of up to $250.
According to Fingerhut, the Fresh Start program does report to credit bureaus as an installment loan, so it will help you build your credit. It seems a Fresh Start account will only report to Transunion and Experian, however.
Here’s how Fingerhut Fresh Start works:
- Make a purchase between $50 and your credit limit.
- Make a one-time, $30 down payment, and your order will ship.
- Make 6 or 8 equal monthly payments on time to pay off your balance.
- When your balance is paid in full, you graduate to a revolving Fingerhut Credit Account with a higher limit.
- Graduating to a Fingerhut Credit Account makes you eligible for credit limit increases and deferred payments with lower monthly payments.
No Application or Annual Fees But Beware of High APR
You do not need to complete the Fresh Start program to apply for a Fingerhut Credit Account, which works like a store credit card.
The card gives you a credit line at Fingerhut’s website or catalog, and it is designed for people with bad credit. This is by far one of the easiest credit cards to qualify for, and its credit history requirements are more lenient than other retailers.
The Fingerhut credit card does not have an annual fee, application fees, or hidden costs like many other credit cards aimed at consumers with bad credit, and credit limits are often higher than other cards. Your account will also be reported to multiple credit bureaus.
One of the most notable features of the card is the very low monthly payments. If you have a balance of $190, for example, your minimum payment is just $13.99. Balances over $1,400 have a 5% minimum payment each month.
While this may be viewed as a good thing, be careful because the Fingerhut credit card has a very high APR, and it can take years to pay off your balance making just the minimum.
Your minimum payment each month is based on your account balance.
Here’s an example of monthly payments:
- Balance of $6.99 to $44.99: Minimum payment of $6.99
- Balance of $45 to $69.99: Minimum payment of $7.99
- Balance of $70 to $99.99: Minimum payment of $8.99
- Balance of $100 to $124.99: Minimum payment of $10.99
- Balance of $125 to $199.99: Minimum payment of $14.99
- Balance of $200 to $249.99: Minimum payment of $17.99
The FingerHut Fine Print Exposed
If you sign up for the Fingerhut Fresh Start program, make sure you understand how the program works.
If you choose to pay your entire balance at the same time as the down payment, your loan agreement is canceled and you are no longer eligible for consideration for a WebBank/Fingerhut Credit Account.
You may also be ineligible for a Fingerhut Credit Account if you file for bankruptcy, have any payments past due, have any payments returned, enter a consumer credit counseling program or have any type of negative credit status.
Fingerhut offers frequent promotions, but you should understand the terms so you don’t get hit with unexpected charges.
The following are some payment options and promotions you may encounter:
- Deferred Purchases. If you make a purchase under a deferred promotion, it will show up on your statement with a summary showing your unpaid balance, any accrued interest and the date until which your payments or interest is deferred. You will still pay the full interest amount on the purchase, even if you pay the balance before the promotion ends.
- No Payments Option. This promotion means monthly payments on your deferred promotion will not be required. Interest charges will still be in effect, however, and added to your deferred balance, even if you pay off the deferred balance before the promotion ends.
- No Payments and No Interest promotion. With this option, monthly payments on the purchase are optional during the promotion period. If you pay your entire balance in full on or before the end of the promotional period, you will not pay interest on the purchase. If you do not pay the balance off before the promotion ends, you will be hit with interest going back to the date of purchase.
Both the Fingerhut Fresh Start program and the Fingerhut Credit Account report to at least two credit bureaus, and both can help you rebuild your credit.
While neither option is perfect — as you will pay a high-interest rate and your credit line is only good at Fingerhut — it may be a good choice if your credit score is very low and you want to reestablish good credit.
It’s also worth noting that there are many other ways to build credit including getting a secured credit card, or an unsecured card that is targeted at people looking to build or rebuild credit. So you do have options!
You can see a full list of resources for building credit here.