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Research: No Credit History? Apply for a Secured Credit Card! -

Secured credit cards are perfect for people with no credit history. Though people may live without a credit card, meaning no debts or burden or whatsoever, it is undeniably true that we still need credit to back up our finances especially when we don`t actually belong to the wealthy and the might who have available cash anytime. Sometimes, plastics can have more advantage than cash to avoid getting physically robbed. Also, credit cards can help us most with traveling expenses, hotel rooms and other establishments. But enough with the benefits of the plastics; ask yourself: are you qualified to get a credit card?

Many credit card companies require a credit history check. This is for their security to avoid defaults that may make them lose a lot. This is why credit companies can be so strict that they have to reject applications from people with bad or no credit history. If you have no credit history, true to say and unfortunately, it will be difficult to have a regular credit card. But no worries! As mentioned before, secured credit cards are perfect for people with no credit history.

Before applying for a secured credit card, here are some basic things you need to know:

1. Costs: Be prepared with the application fees, processing fees and the annual fees. Sometimes, banks charge a one-time application fees which would not require annual fees to be paid anymore. There are some credit cards that charge high fees. Be wary of them and stay away from them. Before applying for the card, know the fees first through the representatives of the banks.

2. Deposit: Secured credit cards require a deposit that will be held in an account. If you make defaults on your account, this deposit will be applied as a payment to your debt. This is good since you don`t have to be marked as in default because your balance is backed up by a certain amount. Try not to have a credit over the deposit though or the credit may accumulate and may make your paying of the principal a little more difficult.

3. Eligibility requirements: Secured credit cards still have to undergo process and may not available to every person with no credit history. You still have to be eligible to get the card. Even when you already have available funds for security deposit and you are willing to put it down to their desk, you still have to be qualified. Don`t worry, again, they will only require you to have a savings account or a checking account with their bank.

4. Credit limits: Credit limit is sometimes a percentage of the deposit made. But to make most of it, you should at least equal to the deposit or even more.

5. APR: Annual percentage rate. It is the interest rate that will be applied to your account balance. This means that the higher the rate, the higher your interest fees.

6. Conversion to an unsecured credit card: An unsecured card often has lower fees or zero fees, lower interest rates and lax restrictions. You`ll be getting a good bargain if the secured card you are applying for has this conversion offer.