What is a Security Deposit?
Secured card are the best thing to build or repair credit.
However, in order to get a secured credit card, you will open
a savings account that will be connected to your card. This
savings account will stay in effect as long as you have the
The bank may have a minimum requirement of $200-$300 for
the savings account however they may allow you to put more
on deposit. Your credit limit will be related to the amount
The deposit is there to protect the lender. It will not
be used unless you default on the amount due on your credit
card. However, since your purpose in getting a secured card
is to rebuild your credit history you won't do this, will
Make sure the bank offers interest bearing savings account
for your security deposit. After 10-12 months of good repayment
habits you should be ready for unsecured cards. Request one
from the bank that helped you get this far, as long as their
fees and charges are fair. Usually they will be happy to accommodate
When you move to unsecured cards it's a good idea to keep
your savings account open anyway keep adding to it and create
good savings habits along with good spending habits.