The average credit score has hit an all time high of 690, according to CNBC.
For those with a below-average credit history – which means around one out of every three US adults! – the choice of a credit card often revolves around weighing the pros and cons of a secured vs unsecured credit card.
If only a secured card is available to you, then obviously, that simplifies the credit card offer selection process a bit. But what about when you have both options available for the taking?
The Ups & Downs Of A Secured VS Unsecured Credit Card
The first step is to understand the differences between a secured vs unsecured credit card.
With a secured card, you have to make a security deposit (often in the hundreds of dollars range) to the card company to open the account. Due to the extra risk they feel they are taking on by accepting bad credit, they require this deposit and limit your spending limit on the card based on it. Your credit limit might equal your security deposit or be some multiple thereof.
An unsecured card is simply any card that does NOT require a security deposit. That’s simple enough. But sometimes you may face higher APR or fees or have to pay an annual fee in order to avoid the security deposit – so it’s not always a one-sided decision.
Of course, if you can get an unsecured credit card that also is superior in other respects, the decision would be pretty obvious. The only exception would be if you are worried you will overspend and want to discipline yourself by keeping your credit limit down via a secured card.
Can I Get A Good Credit Card With Bad Credit?
Yes! There really are credit cards out there with beneficial features that people with bad credit can expect to be approved on. And whether a card is good or bad doesn’t have to turn on the secured vs unsecured credit card axis – you can find quality card in both camps.
But how can I find the best offer, you might ask? Bonsai Finance has the answer – high-tech, high-powered search engines that scour the Internet rapid-pace and sort out the results in easy to scan fashion. Simply plug in the features and criteria you want to search based on, click, and watch your best offers populate the screen!
Besides whether a card is secured or unsecured, you will also want to search for such factors as:
- As low as possible APR. Even among bad credit credit cards, there is often a wide difference in the interest rate you would be charged.
- Avoid an annual fee if possible or choose a card with a very low one. And look for lower cash withdrawal, late, foreign transaction, and other fees as well.
- If you have a security deposit, try to get a card company that requires a lower one. Also look for a policy of allowing a credit limit higher than the actual deposit and for the ability to graduate to increased credit and to an unsecured card with so many on-time payments.
- Don’t be shy about looking for “perks” like cashback rewards, travel points, special student card, and more. Yes, even cards that accept bad credit can still have valuable perks.
When it comes to actually finding and applying for a new card or comparing secured vs unsecured credit card offers – turn to Bonsai Finance. We are dedicated to helping match you to your ideal credit card, personal loan no credit check, or no credit check payday loans. Be sure to search through our blog to find out more!
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