How to Use A Secured Credit Card to Repair Bad Credit

Anyone of us can be confronted with financial difficulty and in some cases such a crisis can damage our personal credit. It is comforting to know that there are steps that can be done to repair damaged credit. In this article, we will be talking about a certain tool which can be used for credit rehabilitation – the secured credit card.

Why Secured Credit Card?
A secured credit card looks and functions just like a regular credit card. It can be used in shopping for goods, paying bills, purchasing online, refueling, book flights, make hotel reservations, etc. Anywhere regular credit cards are accepted, you can be sure that your secured credit card will be accepted as well.

[Article: Do You Need A Secured Credit Card?]

Take a look at any credit card and you won’t be able to tell whether it’s a secured one or not. That’s because the word “secured” is not printed anywhere on the card. There is no indication whatsoever that the owner of the credit card is using a secured account.

The difference lies in the ease of the application process. Regardless of your credit history, you can readily acquire a secured credit card. In fact, even people with no credit history can use a secured credit card to start building credit.

A secured credit cardholder is also expected to submit a cash deposit prior to approval. This deposit will serve as a security for the debts that will be incurred using the credit card. Security deposits can range from $200 to $500 or higher, depending on the credit card issuer. Take note that the amount of security deposit usually dictates the credit limit.

Use a Secured Credit Card to Repair Bad Credit
When credit history has been damaged, the only way to rebuild it is to show your capability to manage debt and credit. Find a secured credit card that will accurately report your payments to the three major consumer credit bureaus (Experian, Equifax, TransUnion).

Of course, improving your personal credit will largely depend on how you manage your secured account. You must use your secured credit card regularly for payments and be able to pay off your balances on time. To avoid debt build-up, it is recommended that you pay your balance in full each month.

Maintaining a good payment record with your secured credit card account can be a great help in improving your credit history. However, you need to keep the rest of your accounts in good standing as well. Therefore, if you still have unpaid charges, do your best to pay your creditors and keep up with your current payments.

About the AuthorTara Tiemann is a credit analyst for which has been a resource site for people who want to live debt free. If you are on a budget using prepaid debit cards,prepaid credit cards and prepaid cell phone service can save you big money!

About Liz Roberts

Liz Roberts is the new credit specialist for Go-Prepaid. If you are on a budget, we can get you discounted cell phone service from Sprint, Verizon and T-Mobile! NO CREDIT CHECK ! Using a prepaid services can save you a TON of money! Follow our blog to find out how!

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