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Secured Prepaid Credit Card

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Erik Said:

Question about Secured Credit Card?

We Answered:

Hi,

A secured credit card will report to the credit agencies only if it says it will on the credit application. Make sure that you look for this before you apply. If you don't, your card will most likely be useless.

A prepaid card isn't much different than a secured card, other than a prepaid card will never report to the credit bureaus, and sometimes you can open up an account for as little as $10.

As for the $75 deposit, that is correct. You have to treat these cards like a gift card. What you put in will be what you can spend.

If you have any questions, feel free to PM me, I work in the industry :)

Matthew Said:

How do secured credit cards work?

We Answered:

Basically, you hand over a certain amount of money to the bank & they deposit it into an account and open a credit account with (usually) the same amount in credit as you deposited. You earn interest on the money depostited. As you use your card, charges build up like any other credit card & you pay them, preferably in full, each month. If you miss your payment, it comes from the money deposited, along with the usual late fees, over limit fees, etc., that credit cards come with. This also reduces your overall credit limit and shows as a late payment on your CBR. Never a good idea to miss a payment on a secured account as you get the old double whammy, late fees & reduced credit limit. As you pay monthly, especially if you pay your balance in full monthly, you get reported as a good repayment history on you CBR and, in 6-12 months, depending on the bank you use, you can get your initial deposit back, if you have maintained a good history. Normally, the bank will require at least 6 months of ontime payments before they will release the deposited funds. Miss the 6th payment in a string of good payments, and you start over.

Darlene Said:

Wells Fargo Secured Credit Card, Is Secured Credit Card like a Prepaid Credit Card?

We Answered:

It means you need to send them $800 to get an $800 credit limit, or send them $300 to get a $300 credit limit. WF needs to see the money: it's a security deposit. It can't just sit in your checking account: WF must have its hands on your money. In most cases, you will earn interest on this deposit.

It is NOT a pre-paid credit or debit card. They hold your security deposit, and you make charges to the account. They do NOT use your security deposit to pay off your balance unless you default and become delinquent. Do not become delinquent - it will l ruin your FICO credit score. Pay on time, every time. They want to see 6 to 12 timely monthly payments in a row. You'll need to pay from your checking account or some other source of cash.

Strategy: Buy small items on it and quickly pay it in full each month. Do not charge anything the first month, not until you see your first bill: just pay off the up front fees they charge in the first month. So you'll start off with a small limit ($300 or $800), charge less than $30 on it, pay it in full every month, and increase the security deposit if you can every couple of months, if you have the extra cash to spare while it's temporarily tied up in the security deposit. The higher you can get the limit while it's secured, the better it will look when it's unsecured.

Never charge more than 30% of your credit limit: it will hurt your FICO credit score if you utilize more than 30% of your credit limit. Call Wells Fargo and ask them which of the 3 major Credit Reporting Agencies (CRAs) they report to. You want them to tell you all 3 so that you can build your FICO credit score with all 3 CRAs.

After 6 - 12 months of making a small charge each month and paying it off on time each month, you can ask the bank to convert your card to unsecured and get your deposit back. When it goes unsecured, call them and ask that they permanently waive your annual fee. If the customer rep refuses, ask for the rep's direct supervisor. If the supervisor refuses, ask for the customer retention department.

Myth-busting fact: You do NOT need to carry a balance month-to-month (and thus pay Finance Charges) to improve your FICO score.

You can redeposit the security deposit money back into a money market account and earn interest. This account will become a nest egg for you, a nice emergency fund.

Best wishes.

Kim Said:

How do I become a Credit card Distributor/Broker both secured and unsecured cards. Any info will help PLEASE?

We Answered:

hi, not sure but perhaps here you might find some leads:

http://credit-cards.ebookorama.com
http://finance.ebookorama.com
http://credit.ebookorama.com
http://credit-repair.ebookorama.com
if you get any luck please don't forget about me lol, hope it helped you!

Kathy Said:

What is the difference between secured and prepaid credit cards?

We Answered:

Here's the difference between prepaid and secured cards.

Prepaid- You spend what you load onto the card.

Secured- The security deposit determines your credit line, you pay back what you spend, just like a regular credit card.

Usually, all secured cards reports to all 3 bureaus, while not all prepaid cards report. AccountNow (http://www.accountnow.net/#) is the only one that builds credit by reporting online bill payments to PRBC, (http://prbc.com/default.php?) a consumer reporting agency Your Ad Here

Discuss It!

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