29 Июл. 2012 г.|
Secured credit card
Many of us make some mistakes with our money, so it’s possible to find yourself with damaged credit at some point. If your credit is damaged, the first thing you want to do is to work on restoring your credit standing.
However, before applying for a secured card, you’ll need to be aware of a few things. Bottom line: secured credit cards offer you a great way to rebuild damaged credit but be careful that the negatives don’t outweigh the positives!
If you have bad credit, one of the best things you can do to start fixing that situation is get a credit card. Credit unions are also more likely than other sources to give those with blemished records a break. Whether it is secured or unsecured, the credit card you get with bad credit is not going to be the best deal but will help you with the credit repair process. Connect with Nik Tsoukalis and his local team at Key Credit Repair to improve your credit and put you in position to buy a home.
Credit Cards A» 10 Questions Before Getting A Secured Credit CardCredit cards are a fact of life.You need one to make a hotel or plane reservation, or to rent a car, even if you plan to pay cash. Get advice for managing credit cards, building your credit history and improving your credit score. One other advantage is that, because they are member organizations, you may be able to get a card with a lower rate, as well.
Responsible use of a credit card builds a good credit rating, too, marking the owner as mortgage-worthy.But people who have never had credit or need to repair a poor credit history may not qualify for a regular credit card. Often, when you apply online for a regular unsecured card from your bank, you can receive an answer right away.
These cards will almost always have annual fees and higher interest rates than cards available to those with better credit. A A secured card requires a cash collateral deposit that becomes the credit line for that account. Linda Sherry, director of national priorities at Consumer Action, says her organization is seeing a trend in banking away from secured cards and toward unsecured cards with lower limits and higher interest rates and fees. However, unlike a standard credit card, these cards typically require a refundable security deposit to grant you a credit line. Some secured credit card issuers give cardholders the benefit of qualifying for a credit line increase without requiring additional funds for a security deposit. Many credit unions offer secured credit cards to their members and might even be able to waive annual fees and application fees. And, in situations involving travel and rental cars, having a credit card makes like that much easier.
Many, if you are not granted a regular card, will automatically offer a secured card instead.
Still, secured cards are a good choice -- and sometimes the only option -- for people who are just starting out or rebuilding after a major life event, such as a divorce, job loss or serious illness.
These typically range from $29 to $39 or more, depending on the card and the interest rates. If you think you are going to be using the credit card to rebuild your credit for more than a year, consider investing in a card that offers this benefit. You’ll find that most of the secured credit cards issued by credit unions also offer lower interest rates, a higher level of customer service, and more options for rebuilding your credit after bankruptcy, divorce, illness, and other life situations that have affected your finances. Some unscrupulous companies that target those with bad credit have monthly fees that, over the course of a year, add up to two to three times the annual fee for other cards.
The percentage of your available credit that you are using affects your credit score, so, low utilization can raise it.
If you were able to get one without a security deposit, ask for a higher limit and a lower interest rate. You may be able to add to the deposit to add more credit, or sometimes a bank will reward you for good payment and add to your credit line without requesting additional deposits.2. In addition, some issuers only give secured cards to people who are new to credit -- not those who have already had one crack and blown it.6.
You might find that cards with a lower interest rate and low deposit requirements have a higher annual fee, while those with lower annual fees have higher interest rates and higher-than-average security deposit requirements. Set up an appointment with your credit union to find out what options you have and what types of secured credit card offers are available. Many credit unions offer secured cards to their members and may offer lower interest rates and waive annual fees.3. Some people have gotten secured cards and found their entire limit consumed with fees before they ever used the card.4. Your credit limit will either be the amount of your deposit or some percentage above that amount.