What is an Unsecured Credit Card and How Does It Work?

An unsecured credit card is a great way to build your credit, minding you can manage to have plastic in your wallet. They do not require collateral in the form of a security deposit and come available for people of all credit scores.

What is an Unsecured Credit Card?

An unsecured credit card operates under a different model than a secured credit card. Unsecured cards, the most common credit card type, often represent what people want when applying for a new credit card.

How do Unsecured Credit Cards Work?

They work by providing you with a revolving line of credit, meaning you can spend up to an approved amount without making a payment within a monthly billing cycle.

What Does it Mean if a Card is Unsecured?

Unsecured credit cards don’t require a security deposit or other collateral. Unless somebody mentions a credit card, it’s safe to assume it’s an unsecured credit card unless they state otherwise.

What is a Secured Credit Card?

A secured credit card is a type of credit card that requires you to put down an upfront cash deposit, usually equaling the amount of your credit limit.

What is the Difference Between a Secured and an Unsecured Credit Card?

Secured credit cards users typically have little to no credit history or have poor credit. In contrast, unsecured credit card users usually have a credit history and at least fair credit.

Is It Good to Have an Unsecured Credit Card?

Unsecured cards are convenient, help you track your spending, and are safer than debit cards in fraud protection. They are also great for emergencies.

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