Pre Paid Credit Card Enlightenment (cont.)
Contributed by Melanie Vannuys
For instance, you may have to pay $20 just for the card and then make your deposit of $500. That $500 is now your credit limit - when it's gone, you can put another $500 if you'd like, but only after you pay another $20 fee. Each card will be different when it comes to fees, just be sure to ask questions so you know what you're getting into up front.
Does A Pre Paid Card Affect My Credit Rating?
Pre paid credit cards are a double-edged sword. Pre paid credit cards have no affect on your credit rating. The fact that you have one will not be reported to the credit bureaus. The cards are just a simple and safer alternative to carrying cash. They can be used anywhere that particular type of credit card is accepted. You can't be turned down for a pre paid card, either.
If you're trying to rebuild your credit, maybe after a bankruptcy, pre paid credit cards will not help you do that. However, there are a number of secured credit cards that you can use and the system works much like a pre paid card. The only difference is secured cards WILL affect your credit rating - positively or negatively.
