A Short Explanation of Second Chance Credit Cards & What You Need to Know

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In today’s world, not having a credit card can be challenging. Most people are going cashless and rely on their credit cards to help build their credit score by paying bills or other payments on time and using a small portion of their credit card’s limit. Not to mention the fact that it can help you during emergencies. But when you have a credit card, it’s crucial never to miss any payments because that’s how you can ruin your credit score. Building a credit score is long and hard, but it only takes a few mistakes to destroy it.

If you accidentally ruined your credit score and you’re not able to take out loans because of that, then a second chance credit card no security deposit by CreditBono can be of enormous help. But there are advantages and disadvantages to these, which you should know about. Read on to better understand second chance credit cards and more.

What You Need to Know About Second Chance Credit Cards: Secured & Unsecured 

Struggling from credit card payments is like running away from your shadow. It’s like an inescapable threat that’s always looming over you. Thankfully, there are ways for you to improve your credit score, even if your credit history is full of past mistakes. One solution is by getting a second chance credit card, but you need to make sure to use it the right way. But of course, you will need to look for a credit card issuer willing to approve your credit card again. One example is CreditBono.

Second Chance Credit Cards

There are two types of second chance credit cards: secured credit cards and unsecured credit cards. Secured credit cards are approved most of the time because you need to make a deposit, which will equal the size of your credit card limit. An unsecured credit card is where the lender doesn’t require you to offer a cash amount as collateral to open up your account.

The Pros & Cons of Getting a Second Chance Credit Cards 

Some advantages of getting a second chance credit card are that you don’t need a cosigner to be approved. Aside from that, you can slowly rebuild your credit score as long as you manage your finances properly. In general, credit cards often come with better protection against fraud compared to debit cards. Finally, there are cashback and rewards that you may reap from some of the purchases you make.

If there are advantages, then there are disadvantages too. Of course, the most obvious is that it can ruin your credit score if you continue not to pay your payments on time. The interest rates and annual fees may be higher compared to regular credit cards. You will also have to wonder if you will be approved since it’s not guaranteed most of the time. Finally, you will need to deposit if your choose to apply for secured second chance credit cards.