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Secured Credit Card

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Nowadays a plastic credit card is a wide spread payment method all over the world. A profitable option allows you to use funds, which you, in fact, don’t obtain in the reality. Still, before applying for a credit card figure out what kind of a card fits your credit history. According to the state of the credit history, financial experts identified two different types of the card – secured and unsecured.

A secured credit card got its name from a security, which the lenders require. Secured credit cards are, basically, created for people with a bad credit history. Therefore, lenders need a proof that a borrower will manage to pay off a debt. If you have a bad credit history and apply for a secured credit card, you will have to provide a lender with collateral.

Collateral acts like a deposit, which you also supply to your lender. Then a lender provides you with a financial support equal to your deposit. Some financial bureaus will provide you with an amount of money, which is less than a deposit. Nevertheless, your regular payments can encourage a lender to increase a credit limit without increasing a deposit. You will get your deposit when you close your account.