Things You'll Need:
- Bank account
- Collateral account
- Money
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Step 1
Approach the bank or credit union where you regularly do your savings or checking transactions. They likely will approve you for a secured credit card partially using your money as security. Open a savings or checking account if you do not have one. They may start you off with a credit limit based on the balance of your checking account and then offer a small available unsecured credit in the future. The amount varies by each bank. Some banks require a "collateral account" on which your credit limit is based. For example, a $300 deposit would give you a credit limit of $300.
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Step 2
Determine the bank's requirements for secured credit cards. Some credit card companies and banks require that an applicant has not declared bankruptcy within the last 12 months. If this were the case, you would need to wait or find another lending institution without this restriction.
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Step 3
Review credit card offers that you receive in the mail. After filing bankruptcy, you will receive credit card offers from creditors, who know that most people who file bankruptcy would like to start rebuilding their credit as soon as possible. Carefully review the offers before accepting any of them.
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Step 4
Compare rates. As of 2009, it is common to get an initial APR (annual percentage rate) of about 9 percent. Do not accept any offer that has a higher APR than the going average.
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Step 5
Research programs. Check if the credit card company requires an annual membership fee. See if this would be worth the cost; for example, a lower APR may justify the fee. As of 2009, the range of annual membership fees is $18 to $75.
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Step 6
Do not apply for too many cards at once. Try only one or two initially. Each time you apply, the credit card company will run your credit. Too many inquiries on your credit may have a negative effect on your credit score. Furthermore, some credit card companies may see multiple inquiries as a red flag, which may lead them to decline your application.
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Step 7
Pay the balance of your secured credit card. Do not think that since a secured credit card is backed by your own money, you do not need to pay on time. You need to make monthly payments toward any balance that you accrue, just as you would with any credit card.
