Secured Credit Card

[tasha41]

Can someone explain the difference between secured credit cards and other credit cards??

I'm thinking of going with Capital One, because I just want a card with a limit of like $500 to start building my own credit.. I don't want to rely on OH for all things (not that I want to put purchases on my credit card but for emergencies or if anything happened with us so I'd at least be able to maybe get a loan or something if I needed it). I realize they make you pay fees on their guaranteed approval cards but the interest rates are pretty much the same as other cards. I also know you have to put a security deposit down on it? Minimum $75 or something, if you can enlighten me, that would be great

I'm applying with the credit union I'm a member of first, this is really just a fall back plan.

I don't have bad credit, I have no credit, which is worse
I'm going to be a college student in Sept. but doing distance ed- if that would help me get a student card?
In terms of assets I have about $8K in my savings account, but that's it really, my car went to live with OH. lol

 

[pinkmac85]

A "secured credit card" is a card backed-up or secured by funds you have deposited with the financial institution.
The card looks like a credit card, and acts like a credit card but will have a limit depending on the amount of money that secures the card.

So you put the money on the card unlike other cards where there is a 1000$ limit or whatever-you can put on 200$ so you have 200$ to spend.

 

[RedString]

The security funds are there in case you can't pay your bill at some point. So it kind of is like a prepaid card in that respect. I was looking at getting one too, but finances became a huge issue, so now I'm putting it off.