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You can think of a secured card as building credit with a savings account, becuase that's pretty much how that works. A deposit is put upfront that's usually tied to a savings account to get the same amount of the deposit in a line of credit. A major difference that can be seen as advantage is that you can increase the credit line instead of having to request one. You would, however have to add to the deposit to increase it, but the deposit gains interest while it's there, so that can be another advantage as well. If maintained properly, secured cards can get you offers for other unsecured cards, and a rainy day fund from the deposit |
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Tactical Medic
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secured means you have to put up a deposit and your credit limit is what you deposited. |
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cireengineering
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A secured card requires a cash balance, similar to a debit card, an unsecured card doesn't require any cash to support it. |
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farrell h
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A secured credit card requires that you deposit money with the issuing bank, and the bank will issue a credit card in the same amount for your use. Secured cards are guaranteed to be approved, because the bank has your deposit money in case you do not pay your balance. A secured credit card for bad credit operates much like a regular credit card. You receive a monthly statement, and you pay your minimum monthly payment or the balance in full each month. You are charged an interest rate, annual fee and possibly other fees for a secured credit card account.
Unsecured credit cards are available for bad credit clients, however, the issuing banks charge high fees to cover the risk of extending credit to a bad credit client. You can expect to pay anywhere from $200-$350 or more in fees which the bank will keep, you do not get that money back. Those fees are upfront costs for obtaining a unsecured credit card for bad credit. In some cases, the bank will allow you to pay the fees over two or more months.
Read more from: http://www.credit-card-gallery.com/article/137,Get_The_Best_Deal_On_A_Credit_Card_For_Bad_Credit |
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pamn40
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A secured credit card requires you to have collateral, usually a checking or savings account. Usually your limit on these types of cards are limited by the amount you have in the account. (Avoid area code 900 number card offers, as these may be a scam)
An unsecured card is based on your credit rating and does not require a bank account. |
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sunflower
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You have to send in money- like 300.00 and they keep it in a bank account with interest and you can charge up to 300.00- this is a secured credit card- It is used to rebuild your credit if your history is poor- Most people pay a fee for it and after about 11 months you can cancel if you paid on time- then you get new offers from other credit card companies for unsecured credt cards- You can cancel your secured card and get back your money as long as it was paid- It does help poor credit histories due to divorce, bankrupcy, etc... Try New Millenium Bank in New Brunswick, NJ- they are good for secured credit cards. Good luck. |
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Stormchaser
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Secured credit cards-You have to put into it a certain amount of money before they will send you the credit card. Like an account. They will hold that money as security towards any future purchases. Basically you are securing your own card. You can't charge more than what you already have paid in that account. (Your credit limit is what ever you paid in advance to be placed in the account. Your using your own money).
This is what many have to go with that has filed bankruptcy in order to help reestablish their credit.
Unsecured, is the opposite of this.The company has appoved a credit limit and you have good credit ,therefore there is no need for you to secure your own credit card.They trust that you will be able to make your payments as promised. |
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*****
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Secured credit cards are backed up by what you have on deposit with the credit card issuing bank. Your credit limit is what you have in your account on deposit. |
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moneywise
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Princess....the answers given so far are correct about the difference between the two but if you're asking that question, you're thinking about getting a credit card. The best advice I have for you is DON'T GET ANY CREDIT CARDS!!! The only reason you need a credit history is to get more credit extended to you, which you don't need. If you're eventually wanting to buy a house, you find a bank that will manually approve you instead of using a FICO score. They do exist.
Don't go into debt for anything other than a reasonable house. It's a whole lot easier to get into debt than get out of it. |
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Mrs. Pierzynski
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secured is when you sign, with collateral, or a bank account, or you pre-pay for the card. They will be sure to get their money. It is like signing something saying I will pay or you can take my stuff. Unsecured is strictly credit. They give you so much credit and time to pay. The difference is usually good credit and bad credit. |
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Taylor
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a secured credit card is based on money that you put down and a unsecured credit card is based on you credit |
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Ed
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secured means insured or some other sort of colateral. |
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beccas_froggie
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MY BELIEF IS:
Secured credit card is a card you prepay for. It's your money you are spending.
Unsecured credit card is a card you get a monlthy bill for. It's THEIR MONEY you are spending.
Now, I could be wrong. Best way to find out is call a bank Monday Morning and ask them. They'd know better than anyone else!! |
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Queenie knows it all.
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The interest rate changes on an unsecured one.
Use spell check next time please. |
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