Leading a life without credit cards today is considered to be next to impossible. While customers with fair to excellent credit history can apply and avail credit cards easily, it is the ones without a credit history or with a poor credit history that are at the receiving end. The onset of recession a few years ago threw the finances of customers off track making most of them default on the loan and credit card payments and send them reeling towards bad credit history. The only solace for such customers is the secured credit card that can help them work towards bettering the credit report and improving the financial future. Though an increasing number of customers today are reaching out to secured credit cards, not all of them are aware of the nuances of this card that matter the most.
The annual percentage rate on secured cards, just like in the case of unsecured ones vary greatly. While the average APR for unsecured cards was 15.8% in 2010, the average APR for secured cards was 19.8%. The reason for this high average is the fact that most card lenders charge up to 29% APR on the secured credit cards they offer. The main reason to obtain these cards is to improve the credit history, but opting for cards that charge such high APR will only push customers deeper into debts.
The fees of secured credit cards vary greatly from one lender to the other. In addition to the annual fees that may go up to $75 a year, customers also have to pay around $39 for late payments and $25 per transaction in case they go over the prescribed limit.
