People can get credit card from various sources, such as bank, financial company, and credit union. Each of them has pros and cons that need to be considered. Credit union is financial cooperative owned by its member as collective fund. The primary goal is financial help to support its member. One of popular services is Secured Credit Card Credit Union.
Understanding Credit Union and Secured Credit Card
Few people create one collective fund as source for further financial transaction. This group is legalized to become credit union. The main services are credit card, loan, and mortgage that look similar to bank. Moreover, the difference between these organizations is collectivity and cooperative type of operation. In addition, you need to be a member for applying credit card, including Secured Credit Card Credit Union.
Each country has different regulation regarding credit union and secured credit card. That is why you need to be careful when choosing this institution to get credit card. Secured card is common from credit union because of less complexity during application process. Moreover, you can negotiate the deposit and credit limit.
What is Secured Credit Card Credit Union? Credit card is easy choice for spending money. It is loan from credit union for borrowers or cardholders to fulfill their need. As similar to bank, borrower has to open an account for safety deposit. Regular credit card does not need this deposit as collateral. However, credit union does not want failure payment to happen because secured one is commonly for people with bad credit history.
Finding Secured Credit Card Credit Union is easy, but you should choose the right one carefully. As it mentioned above, this institution uses collective fund from member as financial resources. It wants to expand its fund via debt and loan. Therefore, secured credit one is created.
Applying Secured Credit Card Credit Union
There are two reasons why people rely on Secured Credit Card Credit Union. Firstly, they do not have experience or history for having credit card. It is sensible choice for beginner to start having credit history then built it. Secondly, secured credit card is a way to rebuild credit score from bad level. Some people have debt issue that reduces FICO score. Furthermore, bankruptcy brings the difficult situation to apply new loan on bank or financial company.
Why credit score is important? It shows your debt worthiness as reference if you decide to take further loan. Credit card is typical loan without collateral. It means you need to pay it regularly plus interest. If you fulfill this agreement, your score will increase significantly. In general, it does not matter whether your debt are vast or small. As long as the minimum payment is fulfilled without late fee, debt score is at good side. This is primary goal for people with low score when choosing Secured Credit Card Credit Union.
The requirements consist of income balance, debt history record, and other financial documents related to debt, spending, and expenses. The process will take time, but mostly very short because credit union does not have many clients. After that, you need to negotiate and sign agreement for Secured Credit Card Credit Union.