Thread: Sears Credit Card: Buyer Beware

Warning: Make sure you read my Sears credit card review before filling out an application. There are some ugly things about it that you need to know.

Whether you’re buying a Maytag refrigerator or pair of jeans, the sales associates is usually all too eager to peddle you a Sears card application. Sometimes, it even seems as if they are more interested in having you apply for a Sears card than they are in your actual purchase!

Why are they so eager for you to signup? Well, you’re about to find out why this card is such a money maker for them…

The truth about “exclusive monthly savings”
Their regular store credit card (not to be confused with the Sears MasterCard) doesn’t offer a rewards program. Instead, their pitch for you to apply is the “exclusive monthly savings” you get for having the card.

So what are these savings exactly? That’s a good question!

The application is pretty much mum about this, other than saying that you get occasional coupons and sales. Are they anything special or half-way decent? Not according to customer reviews I’ve read on the forums.

Conclusion? With no cashback/points program, there’s very little incentive to use this card. Even if you only have fair credit, you would still be better off with an easy-to-get rewards card which at least earns you something for your spending.

The “special financing offers” are anything but special
So if you’re not after rewards, are you after their financing offers? If so, please be careful. The Sears credit card interest rate is astronomical, to put it mildly:

Given their declining popularity in recent years, you would think Sears would at least make an effort to try and offer a decent interest rate. Apparently, they’re not interested in doing so. A 25.24% APR is too high, especially considering that there is no rewards program.

And if you think the 0% interest promotions are a good deal, then I would advise for you to read the fine print:

As you see above, these don’t work like the 0% deals you get on traditional bank credit cards. What Sears does is use deferred interest for their 0% interest offers.

With deferred financing the finance charges are applied to your account retroactively if you don’t pay off the purchase before the expiration of the 0% offer. You'd be wiser to choose a 0% offer like this from a traditional bank card.

Where can you use it?
This is pretty much your typical store card. You can use it at Sears and their partner retailers (Kmart, Land’s End, Orchard Supply Hardware, and The Great Indoors).

Aside from those affiliated retailers, you can only use it at Avis rent-a-car and AOL for monthly provider fees (but AOL was so 15 years ago so what good is that?!).

Does it have any redeeming qualities?
In defense of Sears, they do offer a credit card benefit that is worth mentioning – the ability to access your credit score. This is obviously useful if you have bad credit and are rebuilding. But guess what? Not even this benefit is anything special and here’s why:

• It’s not a true FICO credit score – The credit score you are receiving through Sears is not FICO, which as I’m sure you know is the gold standard. Rather the Sears card credit score is called TransUnion TransRisk, which is something entirely different. So while it’s still helpful for measuring your credit, it’s definitely not a substitute for a real FICO score.
• You can get free scores many others ways – Several years ago when Sears added this feature to their card it was quite unique. But nowadays there are a plethora of websites which give you free credit scores. Here’s how to get a free FICO legitimately. There are some other not-so-legit (scam) websites that offer “free” scores when you enroll in deceptive trial offer, but those aren’t what I’m talking about.

Is the Sears MasterCard any good?
Is it better? Sure. Good? Definitely not! Most credit cards give at least 1 point per dollar spent. That’s exactly what their MasterCard will give you but unlike most other cards, the value you get with each Sears point may be significantly less.

Take a look at this Applebees gift card example. If you do the math, $25.00 ÷ 4,400 points means you’re only getting about 57/100th of a cent per point. I did see some better options, but they required an extremely high number of points (i.e. 20,000 points for a $200 Sears gift card).

In order to apply for the Sears MasterCard you will have to go into their store. There’s no application on their website.

And how’s the customer service?
It truly is shocking to see just how many Sears card reviews rant on about their customer service department. After combing over hundreds of reviews across the net, it’s rare to see people giving it much praise.

Ironically, I saw many negative complaints on Sears.com’s very own “MySears Community” with one user summarizing it as “Customer Service so poor it makes the DMV look good.”

Verdict?
Whether you go with the Sears store card or their MasterCard, it looks to be a lose-lose situation:

• Financing: You lose out with high interest rates and sneaky financing gimmicks
• Rewards: You lose out on rewards, compared to what other credit cards offer.

However at the end of the day, it is easy to get a Sears credit card. It’s not hard as long as you have fair credit. What credit score is needed? Well according to feedback I have gotten, a 600 FICO and sometimes even a high 500’s FICO may be good enough to get approved for the store version from Sears. The MasterCard on the other hand will be a bit stricter, but still relatively easy.

So if you need a basic entry-level credit card to rebuild credit, then I can understand why getting one from Sears would make sense. But for anyone with a half-way decent score, you really should set your sights higher.

I actually like this store, plus this is 1 department store that is a man's store. When you think of department stores like Neiman Marcus, Nordstroms, and Macys they are more for woman. I do realize at times men buy gifts or certain items like suits and ties, but you have to admit Sears is more manly. I like sears way more than Walmart , Target and Kohls.