The Benefits of a Secured Credit Card

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I hope you are doing well as we enter the holiday season. It is almost 2017, and many of you still have not taken the step towards financial freedom. One way you can build or rebuild credit is with a secured credit card.

What is a secured credit card?

Getting a secured credit card and using it responsibly is an excellent way to build creditor’s trust in your ability to use new credit so that eventually you can get an unsecured card. With a secured credit card, the companies need the cardholders to secure their credit purchases by depositing a certain amount of money as collateral. That way, if you don’t pay your secured credit card, the bank can get repaid by withdrawing the money owe from the deposit you provided.

These cards can be used the same way as an unsecured card, except that your money secures them. The good thing about secured cards is that no one knows that the card is secured. The downfall to these cards is that they usually come with high interest rates, over-the-limit fees, late fees, annual fees, cash advance fees and maintenance fees. This is the credit card company’s way of encouraging you to pay to build your credit. Once you have reviewed your credit report, you are ready to sign up for a secured card.

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Ask for the following questions before you sign a contract or send any money:

  • Does your company report to all three credit bureaus?
  • When will I qualify for an unsecured line of credit?
  • What are your credit card fees?
  • Talk with your major local banks and credit unions.

 What is the best way to find secured cards?

  • Creditcards.com
  • E-wisdom.com
  • Lowermybills.com
  • Bankrate.com
  • Cardrating.com

Banks known to issue secured cards with low limits:

  • Capital One
  • Orchard Bank
  • New Millennium Bank
  • First Premier Bank
  • Applied Bank
  • Compass Bank
  • First Progress
  • Open Sky
  • Discover
  • Wells Fargo
I hope you are working on improving your credit and start the new year on the right foot about credit. You might even be able to take your dream vacation once you get your finances in order, regardless of how small your income is. There is always a way to improve your finances and enjoy life without making extra expenditures.
Feel free to contact me with any questions you may have about any of the services we offer.
Talk to you later…
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