Secured Credit Cards

ADVERTISING DISCLOSURE

ADVERTISING DISCLOSURE:
Credit-Land.com is an independent, advertising-supported web site. Credit-Land.com receives compensation from most credit card issuers whose offers appear on our site. Compensation from our advertising partners impacts how and where their products appear on our site, including, for example, the order in which they may appear within review lists. Credit-Land.com has not reviewed all available credit card offers in the marketplace.

Secured Credit Cards


Updated: September 27, 2018

The content is accurate at the time of publication and is subject to change.

Credit card nation - that's what Americans are called for their addiction to and overuse of plastic money. But with such a huge number of credit consumers, still many have not a slightest idea where to go and what to do to obtain their fist plastic and start building payment history with banks.

Major Banks do not feel comfortable about unsecured lending to people without any credit references. And if you do not get a credit line you cannot grow those references. That's' where the catch is, so you actually have to find an institution who'll agree to work with you as a beginner. A secured credit card is easily issued to beginners and is the best tool to establish positive payment references so important for your borrowing abilities in the future.

A secured card looks and works like an ordinary major bank credit card. This means it allows making purchases now and paying for them later, it has a whole range of fees and interest rates typically found on any other plastic. It reports to credit bureaus and shows up in the report as an ordinary credit line. The most valuable feature of a secured card is its credit building program and relatively easy availability to those with no or bad payment history.

The price you pay for easy access to credit seems for many unreasonably high. Secured card grants approval if you meet its major eligibility requirement, in other words, you agree to open a security savings account with the bank. The deposit amount determines your credit line and functions as collateral if you fail to pay bills. Most issuers allow you to charge up to 100% of the amount deposited.

The minimum deposit amount required on most secured cards is $300, the maximum being $10,000 and more. Figuring out which size of deposit you need, 5% of the annual income will do.

Some may think it's pointless. Where do I draw funds for a savings account when I'm looking for a credit card to get those funds? The thing is you need to get on track somehow. If you're ready to pay now, you may grow eligibility for lowest APRs, high limits and rewards cards later.

There are some things to watch out when applying for a secured offer online. First make sure it reports to all major national credit bureaus. As the main reason for using a secured card is to establish credit, monthly reports of your good payments will help grow a positive reputation for you faster. Secured Visa cards from New Millennium Bank and Applied Bank provide monthly credit bureau reporting, so feel free to apply online.

Second, find a secured card application best matching your current financial situation. Mind it that there are lots of fees associated: start-up fees, application fees, finance charges and, of course, penalty fees.

And finally, apply at the issuer that provides interest earnings on the deposit. The average interest rate ranges from 1% to 4%, but some secured Visa offers from Millennium Bank provide a special high introductory savings rate on the collateral deposit. The savings rate becomes critical as the deposit amount grows.

Disclaimer: This editorial content is not provided or commissioned by the credit card issuer(s). Opinions expressed here are the author's alone, not those of the credit card issuer(s), and have not been reviewed, approved or otherwise endorsed by the credit card issuer(s). Reasonable efforts are made to present accurate information, however all information is presented without warranty. Consult a card's issuing bank for the terms & conditions.
All rates and fees, and other terms and conditions of the products mentioned in this article/post are actual as of the last update date but are subject to change. See the current products' Terms & Conditions on the issuing banks' websites.
Add to Favorites:
Get the latest news, articles and expert advice delivered to your inbox. It's FREE.

Related Research:

Citi Premier® Card – A World Elite Mastercard Travel Credit Card

Citi Premier® Card – A World Elite Mastercard Travel Credit Card

Posted: February 10, 2021

Citi, a Credit-Land.com advertising partner, offers the Citi Premier® Card, which gives elevated ThankYou points for your travel expenses and, with the recent update of the rewards program, for purchases at restaurants, supermarkets, and… Continue reading

Discover it® Miles Review: Turn Miles Into Travel Experiences or Cash

Discover it® Miles Review: Turn Miles Into Travel Experiences or Cash

Posted: February 10, 2021

Many travel credit cards come with tempting perks, requiring some effort bonuses, a complicated rewards structure, and steep annual fees. The Discover it® Miles is probably the best Discover card for travel, especially if you do not travel… Continue reading

Top 5 Secured Credit Cards: September 2021 – Experts’ Choice

Top 5 Secured Credit Cards: September 2021 – Experts’ Choice

Posted: October 22, 2020

The COVID-19 pandemic has made significant changes not only in people’s lives and their financial standing but also in the entire financial sector of the U.S. We have collected the best secured card offers from our partners so that you can… Continue reading

You've successfully subscribed!

Please specify the following:All these fields are optional

Your Credit History
Themes you are interested in:

By providing this information you help us make our news letters more useful and informative. Thank you!