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Secure credit cards to improve credit...how does this work?



Susie

Posts: 2
Credits: 180.65
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Sub: Secure credit cards to improve credit...how does this work?
Sat, 11/04/2009 13:28

Hi!

Can someone please give me info on secure cards and how it works?

Thank you much!



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Sub: #1 Almost got my self a Secured Credit card with Bank of America buSat, 04/11/2009 - 13:28



Almost got my self a Secured Credit card with Bank of America but the interest rates were outrageous. 19% on purchases & 22% if you miss a payment and they take it from the deposit. My credit history is "bad" and I can't qualify for a credit card even though I paid off all my debts after a period of delinquency. At the present time I have zero balance due, but my credit still bad. I declined the option for improving credit because of the interest rates.


feelinsick
feelinsick
Posts: 3
Credits: 72.55

Sub: #2 How do secured cards look differently on a credit report and to Tue, 03/17/2009 - 18:37



How do secured cards look differently on a credit report and to creditors from an unsecured card?


Unregistered

Sub: #3 Secured Credit Card QuestionTue, 03/17/2009 - 18:02



I obtained a secured credit card from wells fargo back in 2005 for an amount of $300. I had a loss in my family and went through a period of depression where I didnt pay my bills and the card eventually got charged off. I wanted to make good on the situation and settle up the debt which at the time the lady on the phone offered me a settlement amount but if I paid the full amount she would remove it off completely. Being young and stupid I didnt get anything in writing at the time and of course I paid the full amount and nothing was removed. It's still on there. My question is since this was a secured card and I paid $300 initally should I be responsible for additional debt? I ended up paying $537 (with fees) but shouldnt it have been more like $237 since thats the entire purpose of getting collateral from me in the event I dont pay? Any help would be greatly apprecited.


Susie
Susie
Posts: 2
Credits: 180.65

Sub: #4 Thanks for the info guys!!! this place is great!Wed, 01/24/2007 - 20:05



Thanks for the info guys!!! this place is great!


OverMyHead
OverMyHead
Posts: 41
Credits: 3213.05

Sub: #5 What Wells Fargo means is that whenever you use the card, retailWed, 01/24/2007 - 19:56



What Wells Fargo means is that whenever you use the card, retailers will not know it is a secured card.

If you maintain your monthly payments, you will get your deposit back. At the end of 1 year of maintaining a good standing with the secured card (meaning you must go through one year of paying the minimum on time each and every month), Wells Fargo will then offer you a unsecured card. If you accept, you will get the full deposit back as long as your account is in good standing.

Or, if before the year is up, you decide you don't want the card anymore and close the account, you must wither pay the amount due on your account, or have them deduct it from your deposit. If your account is paid in full, you'll get the full deposit back.

All secured cards are reported on your credit repost as secured cards, and will be updated monthly. So if you miss payments or are late, you can hurt your credit score.

Secured Cards should not be use as a source of cash, however they should be used for credit improvement and/or emergency's only. I use mine only once a month, and then make sure to pay the total amount due (not just the min.) each month. I also use it for emergencies, such as no money to eat or get to work. But you need to keep your spending under control, or only use what you know you can afford to pay when the bills come. It would not look good upon you if you could not maintain a secured card.

Greetings from NY!

2007 resolution: To be debt free once and for all!
Current status: Gathering info and sending out DVs


Susie
Susie
Posts: 2
Credits: 180.65

Sub: #6 Questions: 1. Do i get the money that i deposited back? 2. Wed, 01/24/2007 - 18:51



Questions:

1. Do i get the money that i deposited back?
2. Wells fargo states "Only you will know it's secured." is this true? or will it appear as a secure credit? and how will that be viewed by a creditor? when I apply for a regular credit card?


OverMyHead
OverMyHead
Posts: 41
Credits: 3213.05

Sub: #7 Taken from Wells Fargo: Quote:A Secured Visa Card works like Wed, 01/24/2007 - 18:24



Taken from Wells Fargo:

Quote:
A Secured Visa Card works like any other credit card, and can be used wherever Visa is accepted. Only you will know it's secured.

* To establish your credit limit, you must make a deposit of $300-$5,000 (in $100 increments) to a ???????collateral account.???????
* Your collateral account determines the limit that you may charge up to, and is held as a deposit.
* You still need to make monthly payments toward any balance you accrue, as with any other credit card.

After 12 months, you may be eligible to graduate to an unsecured credit card, and get back the money you deposited in your collateral account.


So basically, if you have at least $300.00 you can apply for this card and send them the money. They put it into a savings account which you will not have access to unless you close out the account. Whatever dollar amount you gave them as a deposit will be the amount of your credit limit. The rest is like a normal credit card. You'll get a bill each month with a minimum amt due each month.

If, for some reason you stop making monthly payments; they will then take your deposit as payment. Secured cards ARE reported on your credit report and if you make your minimum payment each month, your credit score will improve.

I used them(Wells Fargo), and have had no problems with them. Low fees/rates. One month I was not going to be able to pay the minimum and I called them a week before the due date. They gave me a 14 day extension without a problem, without and penalties/rate raises.

Greetings from NY!

2007 resolution: To be debt free once and for all!
Current status: Gathering info and sending out DVs


brownsugar
brownsugar
Debt Samaritan
Posts: 1342
Credits: 14934.05

Sub: #8 Secure credit cards are given usually to consumers that have damWed, 01/24/2007 - 18:08



Secure credit cards are given usually to consumers that have damaged credit or ones that have no credit established. A savings account is opened at a bank of the credit card issuer for the funds to be deposited into. The line of credit on the card usually equals the amount you deposited into the account. When monthly payments are made on time, the credit card company reports this to all three credit bureaus, which will improve your credit rating.

BROWNSUGAR!!


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