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kamran ahmad
What is a credit card?
Cards are credit cards opened with a safe deposit in a savings account, money market or certificate of deposit. The amount of deposit required varies from one card to another, but generally minimum amounts range from $ 250 - $ 500. These funds are considered your security and even earn some interest, because they are held in a savings account. Your credit limit is determined by the amount you deposit in your savings account. Sometimes the limit is the total amount of the deposit, other times it will be a percentage of the total.
It is important to note that a secured card is a credit card, not a debit card. If full payment is not made each month, then interest is charged on the unpaid balance. And the lending institution uses the security money to pay the debt only as a last resort. Although the card is guaranteed, it is still possible credit damage.
What are the advantages of a credit card?
The credit institution. If you have never had a credit card, a good first step in establishing credit is to request a secured credit card. Associate Professor of Economics at Austin Peay State University in Nashville, TN, Jerry Plummer says, "A secured card is more useful for the person to start your credit history, for he says that the person is ready to go the extra step to establish credit. "
The credit repair. If your credit is damaged, you may be able to qualify for a secured credit card. With this secured card appropriately and within the parameters will help rebuild your credit and qualify for an unsecured card. If you had to declare bankruptcy, however, are not eligible until he was released.
Preset limit is not exceeded. If poor spending habits were part of the cause of bad credit, secured credit card can help keep spending under control.
Useful for operations that require a credit card. Hotels and car rentals require the use of a credit card. If you do not qualify for an unsecured card, but the fact of a secured card, you are still able to complete the transaction.
What should I look for or avoid when shopping for a credit card?
Fees. This is the area you want to really study the purchase of a secured credit card. Some cards come with fees that run into the hundreds of dollars, consuming a lot of credit is secured by savings accounts. Professor Plummer says a card is the best free, but only a small amount may be right. Annual rates of attractive secured cards typically range from $ 20 - $ 35. Be sure to watch out for hidden charges such as "registration fee" and "additional costs".
Interest rates. Just because you have no credit or poor does not mean you have to settle for higher interest rates. The attractive interest rates secured cards should not exceed 19%. Shop around and get the most competitive prices.
Read the fine print. Linda Tucker, director of consumer education Credit Counseling Service of Arkansas and Memphis, TN, stresses the importance of reading the fine print. This will allow you to know exactly their obligations to the issuing company, for example, the grace period, what happens if you do not make full payment, and the rates are fixed, if not full payment. Understanding these details will ensure they do not damage your credit.
Fraudulent offers. As with the warranty card is necessary to consider fraudulent offers.The Federal Trade Commission offers these tips to protect against fraud credit card:
Offers of easy credit. No one can guarantee that you get credit. Before deciding to give a credit card, legitimate credit providers examine your credit report.
A call to a '900 'for a credit card. You pay for calls with the prefix '900 '- and you can never get a credit card.
It is important to note that a secured card is a credit card, not a debit card. If full payment is not made each month, then interest is charged on the unpaid balance. And the lending institution uses the security money to pay the debt only as a last resort. Although the card is guaranteed, it is still possible credit damage.
What are the advantages of a credit card?
The credit institution. If you have never had a credit card, a good first step in establishing credit is to request a secured credit card. Associate Professor of Economics at Austin Peay State University in Nashville, TN, Jerry Plummer says, "A secured card is more useful for the person to start your credit history, for he says that the person is ready to go the extra step to establish credit. "
The credit repair. If your credit is damaged, you may be able to qualify for a secured credit card. With this secured card appropriately and within the parameters will help rebuild your credit and qualify for an unsecured card. If you had to declare bankruptcy, however, are not eligible until he was released.
Preset limit is not exceeded. If poor spending habits were part of the cause of bad credit, secured credit card can help keep spending under control.
Useful for operations that require a credit card. Hotels and car rentals require the use of a credit card. If you do not qualify for an unsecured card, but the fact of a secured card, you are still able to complete the transaction.
What should I look for or avoid when shopping for a credit card?
Fees. This is the area you want to really study the purchase of a secured credit card. Some cards come with fees that run into the hundreds of dollars, consuming a lot of credit is secured by savings accounts. Professor Plummer says a card is the best free, but only a small amount may be right. Annual rates of attractive secured cards typically range from $ 20 - $ 35. Be sure to watch out for hidden charges such as "registration fee" and "additional costs".
Interest rates. Just because you have no credit or poor does not mean you have to settle for higher interest rates. The attractive interest rates secured cards should not exceed 19%. Shop around and get the most competitive prices.
Read the fine print. Linda Tucker, director of consumer education Credit Counseling Service of Arkansas and Memphis, TN, stresses the importance of reading the fine print. This will allow you to know exactly their obligations to the issuing company, for example, the grace period, what happens if you do not make full payment, and the rates are fixed, if not full payment. Understanding these details will ensure they do not damage your credit.
Fraudulent offers. As with the warranty card is necessary to consider fraudulent offers.The Federal Trade Commission offers these tips to protect against fraud credit card:
Offers of easy credit. No one can guarantee that you get credit. Before deciding to give a credit card, legitimate credit providers examine your credit report.
A call to a '900 'for a credit card. You pay for calls with the prefix '900 '- and you can never get a credit card.
Credit cards offered by "credit repair" companies or "credit clinics." These companies may also offer to clean up your credit history for a fee. However, you can correct factual errors or outdated information by contacting the credit bureaus even directly. Remember that only time and good credit habits to restore its solvency.
When will I be eligible for an unsecured credit card?
It may take several months to see improvement in your credit history. Bankrate says it is a good indicator when you start receiving flyers in the mail for unsecured credit cards to improve. However, it is a good idea to continue to take it easy. Using a secured card will help you learn healthy habits so that when you get an unsecured credit card, which remain under the control of your spending and credit.
Where can I find a credit card?
Most companies do not publish secure cards. However, you can visit the section of the report cards http://www.CardRatings.com to know where and how to apply. Click on the link entitled "Cards for consumers with little or no credit."
Other tips
Tom recommends staying with only one or two cards and keep expenses to a minimum. The aim is to repay the card each month.
Tucker emphasizes the importance of paying the amount due each month, otherwise late fees may be charged higher interest rates, privileges lost, and credit history negatively affected.
Make sure you are getting a credit card rather than a gas card or store card.
Make sure that a bank or credit union in popularity, even a local, is issuing the card. And do not automatically assume that the bank issuing the card.
Not all issuers report to all three credit bureaus (Experian, Equifax and TransUnion). It is important to get a report card that the three bodies, otherwise you're wasting your time. Fortunately, secured cards normally report to credit agencies such as warranty cards (you should check before applying).
If you filed for bankruptcy, you may have to wait until you have been discharged before qualifying for a secured card.
Get one if you can not get credit, they have no credit history, or if you have bad credit. Plummer said: "Many companies are not even counted as credit such as automobile F & I (Finance and Insurance) people, although they admit it." Therefore, if you do not really need a secured card, you will do more harm than good.
Finally, any situation where you are, no credit or bad credit, the best way to build good credit is to establish a budget and then stick with it.
You can pay a membership fee to one of the three credit bureaus - Experian, TransUnion and Equifax to check your credit score online daily. Visit our Credit Information section for more details. Tom recommends purchasing Microsoft Money 2004, with a one-year subscription to Experian (value $ 99.00).
When will I be eligible for an unsecured credit card?
It may take several months to see improvement in your credit history. Bankrate says it is a good indicator when you start receiving flyers in the mail for unsecured credit cards to improve. However, it is a good idea to continue to take it easy. Using a secured card will help you learn healthy habits so that when you get an unsecured credit card, which remain under the control of your spending and credit.
Where can I find a credit card?
Most companies do not publish secure cards. However, you can visit the section of the report cards http://www.CardRatings.com to know where and how to apply. Click on the link entitled "Cards for consumers with little or no credit."
Other tips
Tom recommends staying with only one or two cards and keep expenses to a minimum. The aim is to repay the card each month.
Tucker emphasizes the importance of paying the amount due each month, otherwise late fees may be charged higher interest rates, privileges lost, and credit history negatively affected.
Make sure you are getting a credit card rather than a gas card or store card.
Make sure that a bank or credit union in popularity, even a local, is issuing the card. And do not automatically assume that the bank issuing the card.
Not all issuers report to all three credit bureaus (Experian, Equifax and TransUnion). It is important to get a report card that the three bodies, otherwise you're wasting your time. Fortunately, secured cards normally report to credit agencies such as warranty cards (you should check before applying).
If you filed for bankruptcy, you may have to wait until you have been discharged before qualifying for a secured card.
Get one if you can not get credit, they have no credit history, or if you have bad credit. Plummer said: "Many companies are not even counted as credit such as automobile F & I (Finance and Insurance) people, although they admit it." Therefore, if you do not really need a secured card, you will do more harm than good.
Finally, any situation where you are, no credit or bad credit, the best way to build good credit is to establish a budget and then stick with it.
You can pay a membership fee to one of the three credit bureaus - Experian, TransUnion and Equifax to check your credit score online daily. Visit our Credit Information section for more details. Tom recommends purchasing Microsoft Money 2004, with a one-year subscription to Experian (value $ 99.00).
Posted in: Secured Credit Cards
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