Auto debiting instead of checks
Question: These cards are not meant for those who can get “real” credit cards.
These cards are for those who can’t get a real credit card. This is a service to help someone establish a credit rating. The charge is so
high because it is high risk to the supplier. I had to use a secured
Let me reiterate my point. This credit line is SECURED. You send the
company a check for $500, which they hold and in return offer a $500 “credit” line. Please explain to me how this poses ANY risk to the “lender”. If you don’t pay your bill, they keep your money and say goodbye.
Answer: It isn’t that you just send them $500, you open a savings account of sorts, and in return you can obtain credit through them. It is a “safe” way for people with bad credit to get a credit card. Some people have bad credit because they tend to overspend on their credit cards and they then can’t pay their bills. The secured visa helps them around that, it helps them learn control. If they screw up by over spending, they aren’t screwed.
Risk was the wrong word to describe it maybe. The practice of giving out credit cards to those with bad credit ratings is high risk. To offset this risk, they require the $500 as “insurance.” The $45 a year and the higher interest rate is the pain in the keister that someone with a bad credit rating has to deal with for screwing up and getting themselves in a position where they can’t get a normal credit rating. It is also for the lender, since carrying a secured credit card service is probably much more of a pain than a normal visa program.
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Filed under: Bad Credit Loan
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