Denied! Your Credit Card App Turned Down, Now What?

Hey Everyone,

If you have ever gotten this response from a credit card company as the above title describes, don't let it be the end of the world for you. There will always be another time to apply. Maybe not just right away.

If your FICO credit scores are down the toilet, don't get discouraged. There is always a solution to every problem. In this particular instance, the solution to the problem would be applying for a secured credit card.

If you have filed for bankruptcy or whether you are still in a chapter 13 bankruptcy, you still can apply for a secured credit card. The only issue would be if you are in a chapter 13 bankruptcy, you would need to check with your attorney and the trustee of your particular state to see how much of a credit limit you are allowed to have while in the chapter 13.

Another thing would be the amount of money you can afford to apply towards your secured credit card.

The secured credit card program works like this. You send the bank that offers the secured program an amount such as lets say $300. This money is put into a savings account with that bank and in turn the $300 becomes your credit limit on the secured card. You can always send in more to boost your credit limit up to the max the particular bank allows.

You have to be very careful on which bank you choose to apply for a secured credit card, though. You need to read their terms and conditions because not all banks are equal as far as having the best program to help you out. Some charge and outrageous fee for just signing up for an account and then some charge ridiculous interest rates.

The bank will pay you interest on the money you deposit also. If you handle your account properly, after a period of time, usually a couple of years, the bank might offer to give you an unsecured credit card and send you your savings deposit back plus the interest it earned!

While you are using your secured credit card wisely and paying on time, you will be improving your FICO scores as well. You have to disipline yourself though and be very consciencious with your account so you can improve your scores. If you make a payment late, this will go against you and could jeopardize your account from ever being converted to an unsecured account!

You definately don't want that to happen. I will being researching various banks that offer secured credit card programs and bring you the list next week.

Until then,

Michael