Secured credit cards can be a good option for anyone who has bad credit and seeks to improve their credit score. A secured credit card usually works off a bank account meaning the cardholder deposits money into an account or uses a savings account as credit and states that if they miss a payment then the bank can use their account to draw the funds for the secured credit card’s payment.
This is a good way for anyone in financial trouble to repair their credit, but there are a few things to watch out for when looking into getting a secured credit card. Most secured credit cards have an annual fee and higher interest rate, but the point of getting a secured credit card is to build credit so shop around and find a lender that isn’t looking to drain your funds with application fees, usage fees, and extensive interest payments.
Again, a secured credit card is an excellent way to get your credit score back on track so make sure you can pay off the charges. The secured credit card, though backed by an account isn’t the same as a debit card. You can’t make charges and just expect the bank to take the money from your account; rather the account is just there in case you miss a payment, but plan on never missing a payment since that would do nothing to improve your credit score.
Not all lending institutions will offer secured credit cards but that doesn’t mean you shouldn’t shop around. Some lending institutions will seek to take advantage of someone seeking an secured credit card and will find ways to drink up your secured credit card account before you even make a charge on the card, so look for the best offer and an institution that understands you are wanting to repair your credit and is willing to help.
Some will look for an Associated Bank secured Visa credit card in the near future. Before assuming that Associated Bank is the right choice it might be best to look at all the financial institutions that are available nationwide. Some of these banks will allow borrowers to submit an application online even if they are not local.