A few years ago, a person with a poor credit record was...

DOLLARS AND CENTS

March 28, 1993|By Knight-Ridder News Service

A few years ago, a person with a poor credit record was doomed to live a life wwithout credit cards.

Not today. Many credit card issuers see a huge, untapped market for "secured cards," which offer a deposit from the cardholder.

"Five years ago, there were less than a dozen secured-card programs in the country, with only a handful offered on a national basis," says CardTrack, a newsletter published in Frederick. "Today, more than 100 isuers offer secured-card programs, with more than 53 national programs."

Among lenders that issue secured cards are United Bank (Philadelphia), (800) 262-3610; Treasure-Land Bank (Oregon), (800) 873-7307; Community Bank of Parker (Colorado), (800) 779-8472; and Fleet Bank (Rhode Island). (800) 537-3777.

The size of the credit line depends on the amount of the security deposit. It can range from 50 percent to 150 percent of the amount posted says CardTrack. Some banks reqiure at least $2,500 to qualify.

When selecting a secured card, consider many factors. aside from the interest rate. Not all banks pay interest on the money posted as security. annual fees range from nothing to nearly $100. And some banks charge a stiff application fee.

Finally, whenever possible, deal directly with the banks that offer the cards. Avoid "credit repair" experts and companies that charge excessive fees in return for a "guaranteed" card.

Once you've had a secured card for a year, other lenders may be willing to issue a regular card, provided timely payments were made on your secured card.

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