Essential Things That You Should Look For In Secured Credit Card
When you are new in the US, it is hard to qualify for the top credit cards with the best rewards, low-interest rates, and a high credit limit. You may be turned down by many credit card issuers, but you don’t have to worry a secured credit card is probably your best option. A secured credit card requires a deposit, and that is why they are easy to get.
Using a secured credit card is one of the simplest ways to build your credit history. This is why it is essential to apply for the best-secured credit card that will help you make a credit history. What do you check in a secured credit card? Well, read on to find out.
Credit Bureau Reporting
With a secured credit card, you can quickly improve your credit score. So, it is essential to ensure that all your account transactions are reported to the credit bureaus. These are the companies that are responsible for compiling credit reports that are used in credit scoring. In America, there are three major credit bureaus, namely; Experian, TransUnion, and Equifax.
A credit card issuer will send your account activities report to two or three bureaus. You should avoid a credit card that doesn’t report your account activities to the bureaus. It is a deal-breaker because it will not help you build a credit score.
Check On the Fees
When applying for a credit card, please read the fine print to check on the fees to ensure they are reasonable. Check out on standard charges such as credit increase fees, activation fees, balance inquiry fees, monthly maintenance fees, and ATM transaction fees. Remember that no matter the amount you deposit, multiple fees can reduce it drastically.
A security deposit is what makes a secured card the best option for people with no credit history or bad score. After you open an account, you need to deposit some cash that the card issuer holds as collateral. The minimum and maximum deposit amount depending on the card issuer.
You are assigned a credit limit that is equal to your deposit, and you will get it back when you upgrade or close the account without any issues. Therefore, it is essential to apply for a secured credit card with a minimum deposit that you can afford. You can search online for more info about deposits.
Upgrade To Secured Card
The best-secured credit cards are upgraded to an unsecured card after timely bill payment for a given period. Unsecured credit cards are the best because they come with lower interest rates, fees as well as fewer restrictions.
If it’s not possible to upgrade your card, keep on paying your bills on time to build your credit score. After some time, your credit score will improve, and you can apply for an unsecured credit card.
The above are some of the things that you need to consider when applying for a secured credit card. There are so many websites where you can get more info about secured credit cards.