Credit card after bankruptcy
Looking for the best credit card offer after a bankruptcy is not a difficult job if you know the place where to find the right card. Let us first see the details of a secured and the unsecured loans. Usually people when applying for a credit card after bankruptcy ask whether they should apply for a secured or an unsecured credit card.
The secured credit card after bankruptcy is taken against a savings account so that you can build some credit with the credit card. The savings account acts like a collateral for your credit card. The unsecured credit card is given out without a security. With an unsecured credit card the person is given the card based on the credit report and the income of the person. The card however has a limit.
Now the question comes how do you select a credit card. Getting approved for a credit card depends on your credit score. When you apply for a secured credit card it has better chances of getting approval because your card is secured and the lender is also assured of the payments. But when you apply for a secured credit card you should be careful so that you dont get trapped. It is not necessary that all the credit cards are same in their features.
When you apply for a secured credit card after bankruptcy you should look for some features in the credit card. A secured credit card is an excellent way to create a positive credit history and rating.
These cards are tailor made especially for people who have no credit history or have had credit problems in the past. These cards are same like other credit cards the only difference being that a savings account must be arranged to open a secured credit card account. This savings account serves as security for your secured credit card.
A secured credit card requires a line of credit that is a cash deposit made by the cardholder. Getting a secured credit card is a very good option if you have failed to get an unsecured credit card in the past. The most essential aspect of the secured card is assured approval and which can then help you build credit by reporting your account activity to the major credit bureaus.
Despite a bad credit past you can still qualify for secured credit card and get approved by banks to get this card. You need to mention certain facts like state of your residence and your duration of residing in that house; home has a telephone connection; are in ownership of a valid social security number. With such a credit card you can set your own limits. The minimum deposit is $ 200 and the maximum can be as big as $ 15,000. As soon as your credit card is approved you qualify for a credit limit equal to 100% of your deposit. On the other hand you are entitled to deposit any sum of money at any time. You can make a deposit of $ 100 or in increments of $ 100. Each of these deposits adds to your credit limit in comparison to your deposit. The only disadvantage is that you are unable to make any withdrawals from this savings account till this account is serving as a collateral for your credit card.
Applicants for a secured credit card also have the opportunity to take part in a referral program. Even though the usual APR applied to the purchases is more than normal for a secured card, a few cards do apply interest to the deposit amount necessary to secure the account, which will be advantageous to you. Furthermore, some card offer rates of return that are applied to the deposit and which are higher than what most secured cards have to offer.
It is always a better alternative to get a secured or partially secured card from one of the top credit card issuers in the country. Most of the Top 10 credit card companies, such as Capital One, Bank of America, Bank One, etc., put forward secured cards to those who need to rebuild their credit. Be careful to read about the annual fee while applying for a secured credit card. The annual fee should not be too high.
Applying for and obtaining these types of credit cards is absolutely worth sending in a deposit to secure your credit limit. Your payment history gets reported to the three major credit bureaus, and your credit score is being improved; and if you keep up to the required payments then it is quite possible that the issuer may offer you an unsecured credit card with a respectable limit.
Bear in mind that getting a secured card from a genuine credit card issuer, you will one day get your deposit back provided you live up to the contract and don't fail to pay on the account. In addition you can earn a small bit of interest while the issuer holds your money as security.
In a nutshell the advantages of the secured card credit are generally no credit check for new applicants; guaranteed approval; free companion ticket upon enrollment; travel related benefits.
No matter how low your credit score is today, you can one day attain a high credit score. Credit cards are a fact of life you may need one to carry on simple errands like making a hotel or plane reservation, or to rent a car, even if you plan to pay cash. Many stores require a credit card to accept your check. People who have never had credit or need to repair a poor credit history may not qualify for a regular credit card; for them a secured credit card may be the only way to establish, or re-establish, credit.
The disadvantages include no grace period and you have to pay annual fee.
Getting a credit card after bankruptcy can be one of the ways to improve your credit score. The secured credit cards offer more or less the same facilities like a standard credit card. Most secured credit card necessitates you to keep an amount of money as balance in a savings account. Your credit funding would be reliant on the balance amount in the savings account. Many providers might also shell out some interest on the savings account. After some time has passed while using a secured card credit you can start to build a new credit rating and then make the grade to qualify for an unsecured credit card.
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