What would the benefit to getting a secured credit card through our credit union as opposed to a regular card through say Capital One? My credit union does a secured card starting at $500. I just don't know if I want to come out of pocket...$500.00. Opinions please!
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Secured card...or CapOne?
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Just look at the overall costs. Generally, if the secured card is dollar for dollar for the available balance, that is not a good deal. E.g. $500 deposit gets you $500 available credit. Now, if you can get $1500 available credit for $500 down, that is probably better as it shows a better debt to balance ratio.
What are the fees associated with each card? Don't mind the interest rate, your goal is not to carry a balance, so you don't really care which one has a lower rate. So, card vs card, it is generally better to get unsecured unless the secured card will cost less and you get better available credit relative to the cash you are freezing for the security.
You only go secured card if that is the only thing you can get, or if the cost of the secured card is significantly less than the unsecured alternative.Last edited by HHM; 02-20-2012, 08:57 PM.
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Originally posted by HHM View PostJust look at the overall costs. Generally, if the secured card is dollar for dollar for the available balance, that is not a good deal. E.g. $500 deposit gets you $500 available credit. Now, if you can get $1500 available credit for $500 down, that is probably better as it shows a better debt to balance ratio.
What are the fees associated with each card? Don't mind the interest rate, your goal is not to carry a balance, so you don't really care which one has a lower rate. So, card vs card, it is generally better to get unsecured unless the secured card will cost less and you get better available credit relative to the cash you are freezing for the security.
You only go secured card if that is the only thing you can get, or if the cost of the secured card is significantly less than the unsecured alternative.
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FYI, when I obtained my Cap One secured card a little over a year ago, i had to make a deposit of $50 and received a CL of $200.Filed CH7 9/24/2010, 341 on 10/28/2010, Disch.&Closed: 1/6/2011. FICO EX: 9/2: 672.
FICO EQ: pre-filing: 573, After BK Public Record: 568, 10/3: 673.
FICO TU: pre-filing: 589, After BK Public Record: 563, 9/2: 706.
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I would try to go with an unsecured card if you can get it without a lot of costs. Our CH7 was discharged three weeks ago. I just applied for a Capital One card, thinking it was a shot in the dark. I was approved for a $2,000 credit limit, with no annual fee. After the first year, the interest rate is high. But as HHM said, I don't plan on carrying a balance, so I don't really care what the interest rate is.
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It seems CapOne is pretty aggressive marketing to bankrupt filers. We received many pre-selected offers and ended up with four cards totally $3,750 in credit.Well, I did. Every one of 'em. Mostly I remember the last one. The wild finish. A guy standing on a station platform in the rain with a comical look in his face because his insides have been kicked out. -Rick
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The benefit to the CU card could be in establishing & building a good relationship. Could be useful down the road, should you need to finance a car. Plus the CU may eventually unsecure the card, releasing your deposit back to you. A possible problem with the low-limit starter Capital One is that after the inital $200-250 credit limit increase, it is unlikely to 'grow' with you.~Staci
Not an attorney, and never played one on tv. My responses are based on my own experiences & personal opinions.)
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