Review Of The Applied Bank Secured Visa Gold Preferred Credit Card
Secured cards can be one of the better ways to build or re-establish credit for those that have struggled financially, but only if the issuer reports its customers’ activity to the three major credit bureaus. And the Applied Bank® Secured Visa® Gold Preferred® Credit Card is just such a card. Using this card in a responsible way can put you on a path to improving your financial standing. Let’s take a look at this card and its advantages and disadvantages.
What Bank Issues The Applied Bank Secured Visa Gold Preferred Credit Card
Applied Bank is located in Wilmington, Delaware and has been providing banking services since 1996. It is an FDIC-insured equal housing lender and is a Delaware State Chartered Bank. The bank has consistently earned the highest ratings from Bauer Financial and the Better Business Bureau.
The Applied Bank Secured Visa Gold Preferred Credit CardApplied Bank® Secured Visa® Gold Preferred® Credit Card is a card to consider. There is no credit history needed to be approved for this card, and no minimum credit score. If you can put up the security deposit, you will likely be approved as a cardholder. The minimum security deposit is $200, and can be as high as $1,000. Whatever you put up as a security deposit will become your credit limit. Hence, if you put $600 as your security deposit, you will be able to charge up to $600 on your account each month. Once you have established yourself as a responsible customer, you may have the ability to increase your credit limit up to $5,000 by adding the corresponding security deposits. The card has what looks like an attractive APR for a secured card: 9.99% (Fixed). The card is backed by the Visa network, so you will have no trouble using the card anywhere in the United States. As mentioned, your account activity will be reported to Equifax, Experian and TransUnion each month, which will help you begin to build a positive credit history if you use the card wisely every month.
The Applied Bank Secured Visa has two factors that a consumer must weigh when deciding to apply for the card. The first is that the card has an annual fee of $48. This is an up-front cost you will incur once you are approved for the card.
Secondly, most every credit card company offers a grace period to their customers. A credit card’s grace period is the amount of time given to pay your credit card bill without having to pay interest. The majority of cards give a 21-day grace period. The Applied Bank Secured Visa does not have a grace period, and this is a significant drawback. This means the cardholder will start accruing interest on the same day a purchase is made. This can be very costly, despite a 9.99% (Fixed) APR, since interest accrues immediately.
Is The Applied Bank Secured Visa Gold Preferred Credit Card Right For Me?
Consumers with poor credit scores may want to start building their credit with a secured card that reports to the major credit bureaus. Your monthly activity will be logged and this can help you take some baby steps in improving your financial well being. The Applied Bank® Secured Visa® Gold Preferred® Credit Card is a card that you can certainly be approved for since it requires no credit history or minimum credit score. Its interest rate of 9.99% (Fixed) looks attractive but it becomes less beneficial when you take into account the lack of a grace period; interest will begin accruing the day you make a purchase. So analyze the costs of using this card and compare it to other cards that have a normal grace period.
Taking Steps To Improve Your Financial Situation & Credit Score
Consumers should do all they can to build their credit score and enhance their overall financial position. If you are going through some financially tough times, it usually permeates every area of your life. There are some steps you can take to improve your financial standing:
Step 1 – Understand The Reporting Process
If your credit card issuer reports to one of the three major credit bureaus (Experian, TransUnion and Equifax), then all of the activity on your card will be reported. If you start using your card wisely, you should start to see a slight increase in your credit score after a number of months. Proper use of the card means making your payment on time and staying well within the credit limits. Conversely, if you are careless with using your card, this will have a negative impact on your credit score. Keep in mind that activity on your account will take a few days to appear on your credit report.
Step 2 – Use Your Credit Card
It doesn’t do you a lot of good to have a credit card and never use it. If you want to build or re-establish credit, start using your card instead of paying cash for certain items. If you’ve struggled financially, only use the card for your everyday items like gas and food. If you are used to paying cash for these transactions, put the money aside as a pseudo-savings account and pay off whatever balance you incur on your credit card at the end of the month. It is absolutely critical to not charge things that you cannot afford to pay off in full and on time when the payment becomes due. You must train yourself to be financially disciplined in this way.
Step 3 – Pay Your Complete Balance on Time
The most important element of your credit score is your payment history. One of the most damaging things you can do is make late payments on your bills. In addition, it is imperative to keep your debt level low. If at all possible, pay off your entire balance by the due date. If you don’t, the interest rate you’ll pay on your balance will be significant as well as very harmful to your financial well being. If this is impossible, then keep your debt level below 30% of your credit limit. This debt to available credit is one of the financial metrics that banks will look at when assessing your risk factor. Anything above that 30% mark is a concerning sign to them. So keep your balance as low as you possibly can.
Step 4 – Work To Increase Your Credit Limit
Obtaining a higher credit limit can actually benefit your credit score. Since one of the elements of your credit score is your debt utilization percentage, you will actually appear to be slightly less of a financial risk if you can raise your credit limit, provided that you maintain a steady balance. You do not need to spend more just because you have a higher credit limit. If that is your mindset, it needs to change immediately. Only spend what you can afford to pay back in full and on time each month. If you have been a responsible credit card consumer for a period of time, meaning that you are making at least your minimum payments on time each month, then you may be a candidate for a higher credit limit. You can call your credit card company and ask for an increase, or you may even get an unsolicited increase from your credit card issuer.
Step 5 – Be Diligent
If you are beginning to develop good financial habits, by all means, stick to them! Being financially responsible takes work, but if you do so for a period of time, these actions may become habits. And it’s important to continue those habits for the rest of your life. Make sure every bill is paid well ahead of time, and hopefully in full so you avoid carrying any balance. While it may not be a lot of fun sitting down at the table to analyze your finances and pay bills each month, it is imperative for you to do so.
The Applied Bank® Secured Visa® Gold Preferred® Credit Card can be a great way to start improving your credit and open the doors to better credit card offers in the future.