Thursday, June 17, 2010

HOW DO SECURED CREDIT CARDS work?

i have a debit card with over $1000 on it but i cant find a car rental agency that will accept without giving 2 more forms of id that i dont have or with them doing a credit check that will turn out so that i wont be able to rent



so im thinking the next bext thing would be a secured credit card..



i love my debit card because i can add funds to it anytime i like with nothing but a trip to the bank.. but with the secured card can you do the same thing?.. when i wanna add money to the card can i just make a deposit on it like i can with my debit card.. and what if i get a secured card fom a bank thats not local how do you make the deposit then like Capitol One?



im actually looking for a secured card with a local bank so i wont have that problem like Bank of America.. but im not sure i can even load money on the card anytime i want like i can with my debit



HOW DO SECURED CREDIT CARDS work?

A secured credit card requires that you deposit money with the issuing bank, and the bank will issue a credit card in the same amount for your use. Secured cards are guaranteed to be approved, because the bank has your deposit money in case you do not pay your balance. A secured credit card for bad credit operates much like a regular credit card. You receive a monthly statement, and you pay your minimum monthly payment or the balance in full each month. You are charged an interest rate, annual fee and possibly other fees for a secured credit card account.



Be aware that with a secured credit card for bad credit, your charges are not deducted from the deposit you have with the issuing bank. The bank is simply holding your deposit in the case that you default on your credit card balance. You must pay your monthly payments, and owe the bank the balance that you have charged on the credit card. You cannot refuse to pay simply because the bank is holding a deposit without further damaging your credit. Read more from: http://www.credit-card-gallery.com/secur...



HOW DO SECURED CREDIT CARDS work?

Secured credit cards DO NOT work that way. You have a set amount you have to give them, say $500. This will be your limit but instead of being able to just put the money back in when you use the card, you have to pay interest on your own money. then, you have to be prepared to pay annual fees and other nonsense charges on your own money. Oh, and you would have payments to them that you could probably be able to pay on line or mail to them. I dont think you can put more money in to raise how much you can spend on it either. Hope this helps.



HOW DO SECURED CREDIT CARDS work?

Ok this is how they work.



(No offence Katrina but I am a professional in the field)



You go to your bank, and open a savings account with a secured credit card on it.



It is the money in the savings account that secures the credit, so that if you default the money is there to cover it.



Keep a limit on your transactions. At first (before you rent a car) but small items ( tank of gas) and pay it off without closing. If you have the money to rent the car in cash, then rent the car on your card, and pay it off in full when you are done using the car. The whole idea is not to have more then 10% balance to your limit by the billing period.



This is how you establish credit. Because it goes on your credit report, this will help you later.



In teaching people how to esblish and maintain credit, I teach them to have 3 trade lines (credit cards, student loans, car loans etc) and to keep the balances down. Over pay on your account every time, this will boost your scores.



In your case, take out 3 savings account at $500 each. Use one for utilites (pay off by end of month) one for car rentals and one for daily expenses. If you maintain a 10% balance for 6 months, then they will consider removing the secure end, or raising your limits. NEVER AT ANY TIME CARRY A BALANCE OVER 10%!

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