Best Credit Cards for No Credit History 2012
For consumers that have not yet established a credit history, a credit card may be an ideal way to begin building that foundation. It may seem as if the only way to get approved for a credit card is to have a credit history but there are cards especially designed for those new to credit.
No Credit-Credit Cards
Credit card providers offer credit cards for a variety of consumer needs. For those who are looking to establish or rebuild a credit history, there are credit cards available that will help accomplish that goal and make way for stronger credit for your financial future.
When looking to select a credit card to build credit, it is important to find and compare secured credit cards. Secured credit cards work in a fashion similar to prepaid cards. Customers deposit a required amount of money into an account which becomes the credit limit for the card. The main and most important difference between prepaid and secured credit cards is the credit card provider will report account activity of the secured card to the credit reporting agency. This will result in established credit and since the account is essentially always paid up to date, the data being reported will create a stable credit score.
A secured card is a great tool for strengthening credit. It also can be a gateway to getting a traditional credit card down the road. Secured cards are offered by many of the major credit card providers and each has different terms and conditions that should be considered before applying for a secured card. It is essential to find out whether the credit card provider does in fact report back to the credit reporting agencies as all secured credit cards work differently.
Why Establishing Credit Is Important
Many industries outside of the credit industry are now relying on credit histories and scores for business purposes. Credit scores are used by more than just lenders for decision-making purposes. These days everyone from landlords to insurance companies are using credit score to develop financial data about consumers. Credit scores can even make or break your ability to secure a new job with certain employers.
When you have never had a need for financing or never applied for a credit card, your lack of credit history can work against you. It is important to establish a credit history and work on maintaining a high credit score. It is also important for younger adults who are just starting out to establish credit early since part of a good credit score is the longevity of the consumer’s history. A secured credit card is an ideal resource for those with no credit to get established in the credit world. A good credit score and long credit history will matter to your overall financial life.
Secured credit cards offer different terms and conditions. Amounts of deposits vary among credit card providers. If you are looking to apply for a secured credit card, it is wise to compare several secured credit card offers before committing to one card. Utilize the credit card wisely by making small purchases and making on time payments to the provider. This will allow for positive information to be reported back to the credit reporting agencies on a consistent basis which is necessary to develop and maintain an excellent credit record for your other financial needs.