Secured credit cards can be used to pay for goods and services. However, a secured credit card requires you to open and maintain a cash balance as security for your line of credit; an unsecured credit card does not.
The required deposit for a secured credit card may range from a few hundred to several thousand dollars. Your credit line is a percentage of your deposit, typically 50 to 100 percent.
Usually, a bank will pay interest on your deposit. In addition,you also may have to pay application and processing fees. Before you apply, be sure to ask what the total fees are and whether they will be refunded if you're denied a card. Typically, a secured card requires an annual fee and has a higher interest rate than an unsecured card.
The best way to establish or re-establish your credit report is with the use of secured credit cards.
We have compiled a list of credit repair tips and we also allow you to ask credit repair questions.
