Capital One Review

Unless you are cut off from television and mainstream media completely, you’re likely familiar with the Capital One Bank ads that promote the company’s credit cards. What many consumers don’t realize, though, is that the credit card giant is also a full-service banking provider. While this bank relies heavily on its online platform, it also maintains some physical locations in Texas, Louisiana and parts of the Mid-Atlantic region. A publicly traded company since 1995, Capital One has recently settled into its new corporate home in McLean, Virginia.

How Capital One stacks up

Pros
  • Credit card options for all kinds of borrowers
  • Strong CD rates
  • Excellent mobile app
Cons
  • Limited branch network
  • High minimum deposit for money market accounts
  • High overdraft fees

 

What’s interesting about Capital One Bank

You’ll find the expected menu of banking services at Capital One, and its 360 platform is designed to let you bank from anywhere at any time. Its mobile app comes highly rated by both Google Play and Apple, with J.D. Power ranking it the highest in customer satisfaction for two years in a row. Another interesting facet of Capital One’s operations lies in its marketing efforts aimed toward the younger generation. Kids of all ages can be joint owners on basic, no-fee savings accounts and teenagers can learn money management through free checking options.

Things to consider

Not everyone is suited for cyber-banking. Many traditional banking customers want the personal touch that comes with periodic branch visits. If you’re one of the many folks who’d rather conduct their money management pursuits with a live person, Capital One won’t work if you live outside the footprint of physical locations. For an online bank that competes based on low opening balances, stashing dollars in Capital One’s money market can be prohibitive due to excessive minimums required.

Checking and savings accounts

Regarding minimum opening balances, the Capital One 360 Checking account doesn’t require a deposit to get started and fees are nonexistent. Leaning on the strength of its mobile app, deposits can be made simply by snapping a picture of a check. The bank provides a good faith overdraft protection system that allows you to exceed your balance if you make a next day deposit of the amount you’re overdrawn at minimum. Fail to make that deposit and a significant $35 overdraft fee will follow.

The Capital One 360 Performance Savings option turns out a 1.9% annual percentage yield (APY) on any account balances and presents a high-yield account with a solid rate. There is no minimum balance requirement and the bank does not levy any fees on account holders. If you wish to set and forget your savings deposits, an automated tool takes care of those periodic transfers from checking. With no fees and a rate that sits at about five times the national average, it’s hard to find fault with Capital One’s 360 Performance Savings.

Money market accounts

Where yield matters, you might choose a money market account that offers a little extra reach on APY. In the case of Capital One’s Money Market option, there’s no current differentiator between it and a statement savings account in terms of rate. Each account gives you a 1.9% rate with the ability to make withdrawals without penalties or transfers on a daily basis.

The choice between accounts boils down to minimum balances, however. The Capital One Money Market mandates that you pony up $10,000 to open an account, whereas no minimum exists with the 360 Performance Savings. All else being equal, it’s difficult to imagine opting for this money market option when you can grab better rates with lower minimums through similar online products from other banks.

CDs

Certificates of deposit (CD) in the Capital One 360 realm range from 6-month to 60-month terms. Across the banking spectrum, you won’t find a ton of differentiation when it comes to the basic mechanics of a CD, except when you’re shopping for CD rates. Early withdrawal penalties on short-term CDs — 12 months or less — will amount to three months of interest, and with terms longer than one year, you’ll forfeit six months of interest by pulling out your money before the full term has been met.

Rates for Capital One CD options stack up admirably against competitors. The 12-month term fetches an APY of 2.20%, which sits at or near the top of the rates online banks offer on one year CDs. What’s more, Capital One allows you to open a CD with a deposit of any size.

Credit cards

Capital One has a credit card to meet every need, from individuals looking to build their credit to customers with well-established scores. They offer a total of 18 cards. Here’s a snapshot of three options that cater to cardholders with various credit standing:

Capital One® VentureOne® Rewards Credit Card

  • Purchase APR: 0% introductory APR for 18 months, with a 14.24%-24.24% variable APR thereafter
  • Transfer APR: 13.74%-23.74% variable APR, with no transfer fee
  • Annual Fee: None
  • Credit Requirement: Excellent
  • Perk: Earn 20,000 bonus miles after spending $1000 on purchases within the first three months of account opening

Capital One® QuicksilverOne® Cash Rewards Credit Card

  • Purchase APR: 26.99% variable APR
  • Transfer APR: 26.99% variable APR with no transfer fee
  • Annual Fee: $39
  • Credit Requirement: Average
  • Perk: Earn unlimited 1.5% cash back on every purchase

Capital One® Secured Mastercard®

  • Purchase APR: 26.99% variable APR
  • Transfer APR: 26.99% variable APR with no transfer fee
  • Annual Fee: None
  • Credit Requirement: Rebuilding
  • Perk: Refundable deposit of $49, $99, or $200 secures a $200 initial credit line. Higher limits can be accessed by making timely payments in the first five months.

Personal loans

Unfortunately, Capital One does not extend unsecured personal loan offers to its customers. If you’re looking for a personal loan, try out SoFi. SoFi believes in helping people with their personal finances, so it has set up an array of services, including career coaching, financial planning advisement, member events and rate discounts. With SoFi, customers can get low, fixed-rate personal loans between $5,000 and $100,000 for debt consolidation, medical procedures, travel, relocation and more.

Mortgage loans

Capital One, while it used to offer mortgage loans to customers, no longer does. For a mortgage loan, try out Reali Loans. As the lending arm of real estate brokerage, Reali, Reali Loans works with you from the beginning of your home shopping experience to help you find and fund the house of your dreams with licensed real estate agents and brokers. Then, simply get the funds for your new house with Reali Loans, thus streamlining the entire process. Because it’s an online mortgage lender, it keeps overhead low, and those savings are truly passed on to the customer. It even sends you a check for what the commission would be when you close on your new home.

Mortgage refinancing

Capital One does not offer mortgage refinancing. While it did at one point, this bank discontinued its mortgage financing and no longer services its loans either. If you’re looking for a mortgage refinancing provider with a ton of options, try looking into Rocket Mortgage by Quicken Loans. Everything can be done online, and because Quicken Loans is the largest mortgage provider in the country, it has a ton of different terms and rates to choose from.

Home equity loans and HELOCs

This bank doesn’t offer any mortgage-related products, which includes home equity loans and HELOCs. If you want to take advantage of your home’s equity, try looking into Fifth Third Bank’s home equity products. Its HELOCs have some of the lowest interest rates available, plus the process to apply is simple and can be done online.

Car loans

Capital One consistently secures itself a spot on the top lists of car loan originators, and it’s no surprise why. With a proprietary Auto Navigator tool to help car shoppers find their new sets of wheels and competitive rates, Capital One has deserved that recurring spot. Customers can pre-qualify for auto loans with Capital One without impacting their credit scores, then take that to the dealership and fund a new vehicle. Customers must borrow at least $4,000, but interest rates are as low as 3.59% — not the lowest out there, but still highly competitive.

The final word

Capital One Bank, with 18 credit card options, ubiquitous advertisements and an aggressive snail-mail campaign, likely needs no introduction. It has a solution for every borrower. While customers seeking brick-and-mortar banking services will be out of luck in 42 states, tech savvy customers will love Capital One’s mobile app and the ability to manage their money on the go. Capital One is best for patrons who want the convenience of digital banking, but customers who need face-to-face interaction should probably seek out another bank to meet their needs.