Secured Credit Card
As with a regular credit card, the card holder of a secured card is still expected to make regular payments. But in cases where there is a default on payment, the card issuer has the option of recovering the cost paid to the merchants out of the deposit. The advantage of the secured card for an individual with negative or no credit history is that most companies report regularly to the major credit bureaus. This allows for rebuilding a positive credit history. Although the deposit is in the hands of the credit card issuer as security in the event of default, the deposit will not be credited simply for missing one or two payments. Usually the deposit is only used to offset the account when it is closed, either at the request of the customer or due to severe delinquency (150 to 180 days). An account that is delinquent continues to accrue interest and fees, and could result in a balance which is much higher than the actual credit limit assigned. In these cases, the total debt may far exceed the original deposit requirement and the card holder not only forfeits their deposit but must still pay the additional debt. Having a secured credit card allows individuals with poor or no credit histories have a credit card which might not otherwise be available. They are often offered as a means of rebuilding one's credit. But the fees and service charges for secured credit cards often exceed that of non secured credit cards. However, for people in certain situations, such as a long history of delinquencies, secured cards can often be less expensive in total cost than unsecured credit cards, even including the security deposit. If you have little or poor credit history, there are several secure credit cards on the market to help you establish or reestablish a good credit history. I, personally, have had problems in the past, but when given the opportunity to rebuild my history with a secured card, took advantage of its benefits. Today, my credit is better, stronger and I receive offers for non secured cards for as high as $6,000 for one card. So, do what I did and review and apply for a secured card today. Take the first step in rebuilding your credit. If you are a student, review the available credit cards for students. The terms and conditions may be a little bit more flexible given your student status. Featured Offers Credit Card Articles Credit Cards 101 Secured Cards Card Types All Credit Cards Business Cards Poor Credit Secured Cards Student Cards Reward Cards APR & Fee Types Highest Rated Cards Low Fee Cards Low Interest Cards Low Intro Cards No Annual Fee Cards Search for A Card Credit Tools Return to Top - Secured Credit Card The information was provided courtesy of Wikipedia contributors, "Credit card," Wikipedia, The Free Encyclopedia, http://en.wikipedia.org/w/index.php?title=Credit_card&oldid=135963443 (6/5/07)
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