If you have poor credit history, looking for a credit card can be discouraging, but there is one credit card you qualify for- a secured card.
What’s A Secured Card?
To establish a secured credit card, you make a deposit with your credit card company. Your credit limit will be the amount of the deposit. Just like any other credit card, you can spend the money on it, and you’re responsible for making monthly payments. These cards are a great option for people with nonexistent or poor credit history, and the limit is usually only a few hundred dollars.
This card is “secure” because the creditor is essentially loaning you your own money. If you don’t pay, the creditor won’t lose because you’ve already paid the maximum amount of the card by means of the deposit. Although many companies offer secured credit cards, Capital One offers a particularly beneficial card called the Secured Master Card.
Why Capital One?
If you’re interested in fixing your credit, it’s very important that your credit card company reports to a credit bureau. (There are three major credit bureaus, and these are the companies that collect credit history and determine credit scores.)
If your card company does not report to a credit bureau, paying the card on time will not help your credit score. Unlike many banks that offer secured credit cards, the Capital One Card reports to a credit bureau, so it will impact your credit score.
What Are The Drawbacks?
To qualify for the Capital One Card, you need an established checkings or savings account with a bank. Capital One doesn’t offer cashback incentives, but other creditors do.
Before you enter into a credit card contract, research and carefully weigh your options. Make good choices!