Secured Credit Card Offers From Chase, Capital One, Wells Fargo, And Citigroup–Are These Cards Helping Repair Bad Credit?

Some of the nation’s top lenders offer secured credit cards for individuals who are trying to repair a bad credit score. Many of these well-known financial institutions like Chase, Capital One, Wells Fargo, and Citigroup, just to name a few, have offers for secured credit cards all over the Internet in hopes of gaining the business of men and women who are trying to repair their bad credit score by building a better credit history. However, many people are often wary of secured credit cards since they require a deposit of a sum of money into a bank account before they are issued.

Secured credit cards can be used just like an unsecured credit card in most cases, only for some bad credit borrowers they are better option. Unsecured credit cards may either be unavailable to a bad credit borrower or come with such a high interest rate that it is unaffordable for the cardholder. In this situation a secured credit card can be beneficial in helping someone build a better credit history, which will obviously increase their bad credit score.

However, despite the fact that secured credit cards can be available to bad credit borrowers and it’s often advised that they be obtained from reputable lenders like Chase, Capital One, Wells Fargo, Citigroup, or another well-established lender, a secured credit card is no guarantee to a better credit score. Anyone who obtains a secured credit card will have to practice smart financial habits before they can use the card to their advantage.

Cardholders who use secured credit cards can benefit but when a bad credit situation is the result of poor spending habits and bad financial practices, a secured credit card will be of little use. Cardholders over the past months who have used secured credit cards to help their bad credit situation have done so in the hopes of repairing their finances and learning more financially savvy habits.

One reason a secured credit card requires a deposit of a sum of money is that it secures the lender against loss if a bad credit borrower either cannot pay their purchases or defaults on their card. Many reputable lenders also report to the big three credit bureaus on secured credit card use and if the cardholder fails to pay the charges on their secured credit card they can do more damage to their credit score.

While there are various financial institutions that offer secured credit cards, the cardholder is ultimately the one who will make the card work or not. Many have used secured credit cards both in their individual or professional life to rebuild a credit score, but if the cardholder continues to spend outside of his or her means, budgets poorly, and fails to make payments or allows their card balance to get out of hand, they may simply add to a poor credit history and wreak more havoc on their credit score.