We are often asked, what is the difference between a secured card and an unsecured credit card. Here's the answer!
A secured card is different from other credit cards because you have to come up with a deposit to secure your card. Usually, but not always, the amount of the deposit is equal to the limit you will be given on the card and no credit checks are conducted in order to obtain the card. If your credit isn't terrible, you may be asked to provide a deposit that is only a percentage of the limit on the card, however, credit card companies will have to run a credit check to determine if they can take that risk.
In short, a secured card is sort of like a credit card with extra abilities - your secured card holds the power to turn your poor credit into excellent credit and all you have to do is use it and keep it in great standing.
With an unsecured credit card, the credit is simply extended to you without security, as your credit score is good enough that you appear to be a low-risk borrower. People with a better credit score can bypass the security deposit step because they have, in the past, kept all their credit accounts in good standing.
When you use your secured card to pay for items in-store or online, there is no way for merchants to be able to tell your card is a secured card. To everyone else, including the credit bureaus, it just looks like a regular credit card.
Refresh Financial offers one of the best secured cards in the market, with low interest, low fees, and a security deposit as low as $200 (most secured card providers require at least $500). Apply quickly and easily online today!
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Refresh financial offers custom credit building solutions to help you build your credit score FAST.
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