Bank Secured Credit Cards
Even though there are many types of credit cards out there for consumers, there are few for those with bad
credit. Those who are looking to repair their credit have a few options available, one of which is the bank
secured credit card. This credit card can help you to repair your credit, as it works in conjunction with
your savings or checking account.
Bank secured credit cards look and work just like traditional credit cards, although they use your bank account
as collateral. Anytime you aren’t able to pay your credit card bill at the due date, the bank will take the money
out of your account. This way, there is always money there for the bank, in the event that you are unable to make
Bank secured credit cards are also ideal for those who have a bankruptcy or simply don’t qualify for a line of
credit due to bad credit or no credit history. These credit cards show your bank that you are able to pay your
monthly dues, and that you are taking the necessary steps in rebuilding or building your credit. Over time, if you
remain responsible and pay your bill on time, your bank may give you an unsecured line of credit - known as a
standard credit card with no collateral.
Due to the fact that bank secured credit cards only allow you to spend what have in your account, you don’t need
to worry about debt. When you can’t make a payment, the bank simply takes the money out of your account. Although
this is a great back up plan, you should always pay your bill and never let this happen.
Just like other credit cards, bank secured credit cards do have disadvantages that can hit you like a ton of
bricks should you use the card irresponsibly. Anytime you don’t pay your bill on time, the bank can hit you with
high interest charges and late charges. These charges and fees can get higher and higher if you don’t start paying
your bill, which can eventually cause you to drain your account that you set aside. If you pay your bill on time
though, you won’t have to worry about being hit with these types of charges.
For those who have bad credit or need to start building credit, a
bank secured credit card is a great place to start. These cards can lead you to an unsecured
credit card, providing you pay your bill on time. Almost all banks offer these credit cards, all you have to do is
ask. Once you have kept your credit card in good standing for a period of time - you’ll have the satisfaction in
knowing that you are taking the right steps in rebuilding your credit.
Credit in Minutes Tip #1
Stay on top of your credit report. Most credit reports contain errors. Make sure you check your credit report
every year (you get one free credit report every twelve months) and if there are errors make sure to challenge them
with the reporting credit agency. Credit agencies are required to investigate each and every challenge that gets
Credit in Minutes Tip
Just because you qualify for all of those credit cards does not mean you should get them. A person with too many
credit cards looks sketchy in the eyes of a potential creditor. Think of it this way: if a person is financially
stable does he or she need ten different credit cards? Wouldn’t just one or two suffice?
Credit in Minutes Tip
The best way to raise your credit score is to make all of your payments on time. It sounds too simple to be
true, but that’s all there really is to it. Staying out of debt and/or making all of your debt payments on time
will keep your score up where it should be.