Opening a secured credit card is a good first step for many California consumers working to build good credit scores. If used responsibly – and strategically – a secured credit card is a useful tool in the credit building process. However, many California credit card users get impatient with the transition from a secured credit card to an unsecured credit card. Many assume that the change is quick and automatic, especially if they make their payments on time. Yet, depending on the consumer and the credit card company, transitioning from a secured to an unsecured credit card can take a considerable amount of time and effort.
The Best Secured Credit Card Strategy for California Consumers Working to Build Good Credit Scores
Before applying for a secured credit card, California consumers should know two important details. First, secured credit card issuers typically require a deposit. In many cases, the amount of the deposit amount becomes the card’s spending limit. Yet, depending on your credit score, your available credit associated with the card may exceed the initial deposit.
Next, California residents with bad credit usually have an easier time getting approved for secured credit cards vs. unsecured cards, but approval is not guaranteed. Secured credit card issuers still enforce approval requirements. So, make sure that you understand and meet these qualifications before filling out and submitting an application.
Once approved for a secured credit card, you should use it, but sparingly. Ideally, California credit card holders should charge no more than 30% of their available credit at any given time. Otherwise, their credit scores might drop. For secured credit card users, this is often challenging. Normally, spending limits on secured credit cards are between $300 and $500. Therefore, in order to build good credit with this type of card, you must exercise extreme caution with your purchases.
Finally, you should pay off your balance every month. This is helpful when it comes to keeping your utilization down, and it prevents you from paying interest charges. After several months of strategic credit card use and prompt payments, many California consumers reach unsecured card eligibility.
Transitioning from a Secured Credit Card to an Unsecured Credit Card
Some credit card companies automatically transition California secured credit card holders to unsecured cards, but not all of them. Also, even secured credit card providers that offer this service only allow the transition after a consumer meets certain requirements. In these arrangements, the creditor normally sends the customer a new card with a higher spending limit along with their original deposit.
With other secured credit cards, Californians working to build good credit scores must actively seek a transition to an unsecured card. Sometimes, secured credit card holders who want more available credit must apply for another credit card altogether. So, if you are unsure about your issuer’s policy, you should ask them about what they offer well before you’re ready to make the switch.
It is also important for all California residents to regularly check their credit reports. After all, your credit score is calculated from information contained in your credit reports, so you should verify that it is accurate. Unfortunately, creditors and credit reporting agencies frequently mishandle consumer information and make mistakes. These inaccuracies result in credit report errors that can damage credit scores.
Also, monitoring your credit reports is a good way to catch fraudulent items that could indicate identity theft. In the wake of the Equifax data breach of 2017, everyone in California, and in every other state, must exercise extra caution with their credit reports.
If you find suspicious items or errors on any one of your three credit reports (from the three major credit bureaus), call Credit Repair Lawyers of America in California. When you contact our firm, and experienced credit attorney will handle the credit dispute process for you for free.
The Free and Legal Way to Get Better Credit
Don’t let fraudulent items or errors on your credit reports bring your credit score down. At Credit Repair Lawyers of America, we’ve been cleaning up credit reports for consumers since 2008 for free. How do we do it? All of our fees come from the defendants in settled cases. This is why our clients pay nothing for the work we do.
Let’s start the conversation about what we can do for your credit. Set up your free consultation today by calling Attorney Gary Nitzkin at (916) 438-9400 or sending him a message through our contact page.
For more information about Free Credit Repair, please visit https://www.creditrepairlawyersam.com/california/credit-repair-ca/. Or, to learn more about Free Credit Repair After Identity Theft, check out https://www.creditrepairlawyersam.com/california/fix-identity-theft-ca/.