Not all secured credit cards are created equal. So how can you determine which is best secured credit card for you? Here are the most important considerations:
Credit reporting
Since the biggest reason for getting one is to establish or rebuild your credit, it’s important to verify that the card issuer will report your on-time payments to the credit bureaus. Unfortunately, not all of them do — so be careful.
Fees
Comparing secured credit card fees are important to keep your expenses as low as possible. In particular, check for any processing payments, sign-up charges and annual fees.
Interest Rate
The annual percentage rate (APR) determines how much you’ll pay to carry a balance — so keep it as low as possible.
Security deposit
It’s easier to get a secured card with a low security deposit. In many cases your credit limit is equal to your deposit. However, the best secured cards offer credit limits that are higher than your security deposit.
The “Fine Print”
Finally, before signing up for any secured card, look online or call the card’s customer service number to get a summary of the card’s terms and conditions, including whether or not the card can be converted to an unsecured credit card, and what you need to do to get security deposit back.
Photo Credit: GotCredit
Great article!
Thanks, Kenny!