What is a Secured Credit Card in Canada?
Credit Cards Bankruptcies Canada: When a person goes into bankruptcy he has to hand in all his credit cards to the trustee. After that person has been discharged from bankruptcy, he or she is often a good credit risk, since that person has no debt. Getting a secured credit card is a good way to get a credit card immediately and to help rebuild credit.
Regardless, a discharged bankrupt who has received their bankruptcy discharge in the recent past often has a difficult time getting a new credit card.
A prepaid credit card can help you with car rentals, building a credit history and improving bad credit.
Always make sure to pay more than the minimum payment to show you are in control of your credit.
Secured Canadian Credit Cards:
An option is to acquire a “secured credit card”.
Such a card is backed-up or secured by funds you have deposited with the financial institution.
This security deposit will become the funds used to secure the card against future payments.
The card looks like a credit card, and acts like a credit card but will have a credit limit depending on the amount of money you put into your security deposit.
You will deposit the funds into a savings account with the card provider.
You can start rebuilding your credit rating and improve your credit score if you use a credit card that is secured.
When you use your card the issuing company Peoples Trust will report the payments you make each month which helps rebuild your credit as you make regular payments over time.
A secured credit card has many advantages over an unsecured credit card.
The interest rate on a secured card is much lower, the annual fee is lower, and approval is almost guaranteed!