Outlining Secured Credit Cards

Thursday, November 10th, 2011
Updated: November 10th, 2011
The content is accurate at the time of publication and is subject to change.

Even if you have moved away from using credit cards, either by choice or by necessity, you still need to carry one in case you need to reserve a rental car, purchase plane tickets or book a hotel room. It is also wise to have a credit card on hand in case an emergency should arise. It is also necessary to use a credit card from time to time in order to build credit history, cultivate a good credit score and establish your creditworthiness. Good credit history is essential for anyone who intends to apply for a loan or a mortgage at some point in the future, and makes you eligible to receive the best credit card offers with the lowest APR’s and most generous rewards programs.

However, if you are someone who doesn’t have any credit or if you have a poor credit history due to some financial missteps, it may prove challenging to qualify for a regular line of credit. In that case, a secured credit card may be a good way for you to repair damaged credit or build up your credit from scratch.

Secured Credit Card Basics

A secured credit card is a card that requires a cash deposit. The amount deposited then becomes the line of credit for the account. There are many banks and credit unions that offer secured credit cards to customers coming from iffy credit situations, although no all of them do. Occasionally, you may find that a secured card is only an option for people with no prior credit history, not to those who have poor credit. Be mindful that different lenders will have different fees attached to such cards. Be on the lookout for application fees and annual fees, and make sure you shop around and compare in order to get the best deal.

Secured Credit Card Details

The amount needed to deposit to open up a secured credit card will vary from bank to bank, although it is $300 to $500 in most cases. The card’s credit limit will either match the amount deposited or be some percentage above the deposited amount. Your deposit will earn interest, typically at the same rate a savings account would earn at that same lending institution. Deposit options vary, ranging from a regular savings account to a money market account or a certificate of deposit. It’s a good idea to inquire about how long the money must stay on deposit after you close the account, because it is not unusual for banks to want to hang on to the deposit for a few additional billing cycles should any additional charges surface.

Secured Credit Card Benefits

Banks will sometimes reward responsible behavior with secured credit cards by raising the credit limit without requiring that additional deposits be made. A secured credit card does not allow for any overspending, which means that the cardholder can avoid some of the financial pitfalls that accompany unsecured cards, like spending beyond your balance and incurring fees. And as long as the bank reports your secured credit card activity to all three major credit bureaus, you will be building up your credit. Check with the bank to make sure that they do report secured credit card information before you apply.

All rates and fees, and other terms and conditions of the products mentioned in this article/post are actual as of the last update date but are subject to change. See the current products' Terms & Conditions on the issuing banks' websites.

Latest Secured Credit Cards Guides

Secured Credit Cards – When You Should Prefer Them March 13th, 2020

If you need to build credit, a credit card is a sure method. But sometimes it’s hard to get a credit card having not so good credit score. That’s where secured credit cards come to the rescue.
Secured credit cards are very similar to general unsecured credit cards, except for one thing.

Continue »
Secured Credit Card: How To Use It Right February 1st, 2020

Sometimes people with bad credit history are at a dead end and are looking for a way out. There are several options for people in a quandary. There are different types of credit cards. Here we want to show you the most common. A secured credit card may be the best option for people who […]

Continue »
Here’s How A Secured Credit Card Helps You Build Good Credit January 8th, 2020

If you’ve ever wondered what exactly a “secured” credit card is, or why they’ve become so popular recently, read on to find out how this type of credit card is helping people establish and repair their credit.

Continue »
Easy Ways To Get Your Credit Back On Track March 9th, 2018

If your credit is less than perfect, you might be wondering how you can ever get it back to where it used to be – or even better than it’s ever been before. A great credit score is helpful in all kinds of situations, including buying a home, a car, getting a business loan, renting an apartment, and even getting a job.

Continue »
The Surprising Credit Card Trend That’s Helping People Build Good Credit October 31st, 2017

It used to be that many people hadn’t heard of secured credit cards. If you said the words “credit card,” folks assumed you were talking about a regular, unsecured credit card, and didn’t even know there was another kind. However, these days secured cards are making a huge splash, and more and more people are signing up for them.

Continue »
Best Credit Offer
Applied Bank® Secured Visa® Gold Preferred® Credit Card
Check off the cards you want to compare. Then click the Compare link to go to the comparison table.
Consumer Rating: 4 / 5
Horizon Card Services Group One Freedom Card
Copyright © 2001-2024 BestCreditOffers.com All Rights Reserved.

See the credit card's terms and conditions on the online application page. Note that this website may be compensated by credit card issuers when the visitor applies for a card through the links on this website. We do our best to maintain all information accurate and up to date. However, we do not warrant the credit card information won't change. Click the "Apply Online" button and review the current info on the secure credit card terms page.

Information in these articles is brought to you by BestCreditOffers.com. Banks, issuers, and credit card companies mentioned in the articles do not endorse or guarantee, and are not responsible for, the contents of the articles.

The BestCreditOffers.com webpage is a free service and an information resource for credit cards and financial products and services available to eligible United States consumers. BestCreditOffers.com does not offer any warranties and is not a direct service. There are no guarantees for approval or offers when applying for a credit card. Please refer to the application if you would like more information on each credit card. When you click "Apply" for a particular credit card, please take the time to review the terms and conditions of the product/service at the issuer's website. All logos on the BestCreditOffers.com website are property of their respective owners.

Disclaimer: This editorial content is not provided or commissioned by the credit card issuer. Opinions expressed here are the author's alone, not those of the credit card issuer, and have not been reviewed, approved or otherwise endorsed by the credit card issuer. Reasonable efforts are made to present accurate info, however all info is presented without warranty. Consult a card's issuing bank for terms & conditions.

BestCreditOffers.com makes every effort to keep information up to date and accurate. However, the information regularly changes and is presented without warranty. Therefore, we strongly recommend all our readers to visit the credit card application page by clicking "Apply Online!" button to review the detailed credit card's terms and conditions. Note that BestCreditOffers.com may be compensated by the credit card issuers when the readers apply for a credit card through this site.

BestCreditOffers.com is an independent, advertising-supported website which receives compensation from the credit card issuers and companies whose offers appear on the site. Compensation may impact how and where products appear on our site, including, for example, the order in which they may appear on the site pages. BestCreditOffers.com does not review or list all available financial or credit offers.

You've successfully subscribed!

Please specify the following:All these fields are optional

Thank you for providing this information! We will make sure our letters are useful for You.

User Generated Content Disclaimer: These responses are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser's responsibility to ensure all posts and/or questions are answered.