Have you had a secured credit card with a bank for more than six months to improve your credit? You might be ready to transition to a regular credit card.
The successful management of a secured credit card will help you build a credit history. With a credit history you will be able to get a regular, unsecured credit card.
Common requirements for transitioning from a secured card to a regular card are:
* Minimum secured period established by the bank has passed. Banks usually have minimum terms of 6 to 12 months of good management of a secured card before they offer you a regular card.
* You managed your secured card well: paid on time, at least more than the minimum (and preferably the full amount), and never charged more than your limit.
* Your credit score has reached 670 and above
* There might be a need for you to provide additional personal identification information at the time of the transition. Some banks and credit unions may require a Social Security number in order to offer you a regular credit card.
How does the transition happen?
If you have carefully used your secured card, the bank or credit union is likely to contact you after the minimum secured period to let you know that your card can be transitioned into a regular credit card. However, it is a good idea to keep your own record and contact the bank or credit union when the secured period has passed. Usually if you let your existing secured card transition into a regular credit card, no new application is required. The higher annual fees and interest rates of a secured card might remain, so it might be a good idea to apply for a new, less expensive credit card.
How to Handle your Credit Cards
TIP: Closing your secured card might hurt your credit score, so consider keeping the secured line open even after you have opened up a regular credit card account.
Andrea Stiles Pullas writes about ways to build and maintain good credit for immigrants to the United States for AccionUSA Your Money and You .