Best Secured Credit Cards
Applied Bank® Secured Visa® Gold Credit Card
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Introrate (purchases) N/A * |
APR (purchases, fixed*) 9.99% * |
Annual fee $50.00 * |
How to Establish a Credit History
Having a credit card is almost a necessity. Not only is it convenient to carry a card that is accepted worldwide, but it can also be the required payment method. When checking in at a hotel, you may need to have a credit card on file even if paying cash. This will allow the hotel to charge for any damage to the room, and also for any use of the mini bar. Car rental companies also need the ability to charge in case of damage, so traveling really becomes a hassle without a credit card.
Individuals with no prior credit on their report are finding out how difficult it is to establish a credit history. There are very few creditors wanting to be the first to risk their money, without knowing the likelihood of being paid back the loan. Someone denied credit is probably going to continue to submit applications, and probably also going to continue being denied. The reason is that new creditors can see the recent denial of credit, which is going to decrease your chances of approval.
There are a couple of guaranteed ways to build your credit. The best way is through a joint account, which makes you an authorized user and the activity is reported monthly to the credit bureaus for as long as your name is on the account. The joint account holder does take a risk, and therefore it may not be possible to find a willing participant.
Secured credit cards are also guaranteed to build credit. The way it works is by establishing an interest bearing savings account with the card issuer, where the balance is used as collateral towards your credit line. However your payments must be made like a regular card and the security deposit can not be used for that purpose.
Fees are unavoidable when it comes to secured credit cards, whether it is an application fee or annual fee. Considering the card can be cancelled once you have proven to be a responsible borrower, it is a small price to pay.





