Few people believe they know the whole thing about the secured credit cards. When you send in the deposit, you may get credit card. Prior to you go and jump in secured credit card race, there are some things that you must know.
You have to pay
Think you are entitled to low interest rate card just because you are giving security deposit? Rate of 5 or 6 % is dancing on your head, you would think twice. Interest rates of the secured cards are equal to the unsecured cards, & how much you will pay will depend on the damaged of your credit.
In reality, a few secured credit cards compel processing charges & annual fees besides high interest rates. Prior to applying for secured card, you need to compare the rates cautiously and understand exactly what you will be charged. Something in the excess of 20 % interest or $100 yearly fee is usually too much.
Behavior Does Pay
Imagine secured credit card is only an means to end? You make use of it for 6 to 12 months and after that get rid? Some cards are intended to be in that way, however a few secured credit cards will grow with you.
If you want secured card, then look for one, which offers increasing credit limit and good payment history, better yet, one, which transitions in unsecured card after some time. Since length of the creditor relations has impact on the credit rating, it is good to look for credit cards that you will keep for long haul.
Secured cards are not like the Prepaid Cards
If you considered foregoing secured card & selecting for prepaid credit card, as initial asset is less, then you have to think again. The secured credit cards account to credit bureaus & work to get better your credit card rating. The prepaid credit cards will not. In actual fact, few places that accept the secured cards might not accept the prepaid cards, like car rental facilities & hotels.
World of cards can be very confusing, there are a few fixed notions about different kinds of credit cards. Do not let rumors that you have heard or misinformation that you have got about the secured cards lead you off track from making sound choice to which credit card is good for you.
Advantages of Secured Credit Card
Besides saving money by getting secured credit card, you can as well get back the money, in form of the deposit. Just make sure you follow your payment contract with company, as well as evade defaulting on account. In addition, by establishing the credit with top credit corporation, you will improve your chance of getting offered unsecured credit card afterwards. You can see, if you are paying off the dues dutifully, you are building very good credit history. The credit score will improve each time when positive payment is reported to all major credit card bureaus.
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