Posts Tagged ‘Pre Paid Credit Cards’

What Are Prepaid Credit Cards?

Prepaid Credit cards work just like a debit or credit card. The only difference is that you pay money onto the card first, spend it, but you will not go over any limit, because the only limit is set by what you prepay onto the card.

Unlike the traditional credit card format, you will not acquire any debt with prepaid debit cards as there are no monthly or interest charges.

To apply you do not have to go through any credit checks so almost anyone will be approved for guaranteed acceptance.

You can use just it like a credit or debit card to pay your bills, shop at the supermarket, buy items online and even withdraw cash from ATM machines. They are accepted throughout the world and come in the form of a Visa, Maestro or Mastercard.

Prepaid debit cards are a good solution if:

1. You are struggling with bad credit. If you are struggling to apply for a normal credit card, but need a Visa, Mastercard or Maestro for everyday occasions, a prepaid debit card is ideal. With no credit checks, everyone has guaranteed acceptance.

2. You want to give a gift of money to someone. Unlike normal gift vouchers, these cards are not restricted to just one store and you can use a prepaid debit card (MasterCard or Maestro) in millions of places across the globe.

3. You are planning on traveling abroad. If you do not want the hassle of traveller’s cheques or carrying around a lot of cash, then they are a good solution. They can easily be stopped or blocked if lost or stolen and you will also be able to draw cash out from many ATMS around the world. Some cards even offer 0% on foreign exchange fees.

4. You want to help younger members of the family learn how to manage their own finances. With more and more Britons facing debt troubles, this can be beneficial in teaching your children that you can easily live life without getting credit. Even under 18’s can apply.

5. You want to separate and organise your finances. You can easily keep track of your spending on things like shopping, luxuries, travel, bills or anything else that you can think of.

6. You are having problems opening a bank account. Most bank accounts will come with a debit card, but if you are struggling with bad credit, you may find it difficult to get one. There are no credit checks required, so you have guaranteed acceptance.

Tips On Choosing Prepaid Credit Cards

There are a lot of choices for prepaid debit cards in the UK and most come in the form of a Mastercard or Visa card.

Each card company will have different features and benefits which you should consider before applying:

Some cards will have an annual subscription fee and some with have higher top-up fees than others.

What are the top-up options available?

Find out if you can top up your card at post offices/paypoints etc.

The more top-up options you have the better.

* Is it possible for you to manage the card online and actually see transactions you have made etc?

* Does the card offer a 24hr top-up service, especially for an emergency?

* What kind of protection do you get from the company?

There are many choices available on the market, the card below is the best choice for the benefits outlined below.

Cashplus Gold Mastercard

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Avoid High APR With Pre Paid Credit Cards

Free pre-paid credit cards are a perfect option to avoid the high APR. The card help the owner and user to managed their personal finances better. In this respect the user is save not to over spend his card, as funds need to be added before using the pre paid credit card.

This type of card do not allow the user to go into debt, avoiding any interest payments as a result of missed or late payments. Usually the credit card holder is not receiving any monthly bills from the card company either.

Apply For Credit Card-Getting Approved For A Credit Card Can Be Difficult

Getting approved for a credit card can be difficult without a positive credit history working in your favor. It’s a Catch-22: To obtain a credit card, you need a good credit history. But to have a good credit history, you need to establish good credit!

This no-win cycle can keep people with a non-existent, limited or negative credit history from getting approved for a credit card. But it doesn’t have to if you understand the type of credit cards available and how to build a good credit history.

When it comes to credit cards, the type of card you apply for will depend on your situation. If you’re a student, you’ll, naturally, sign up for a student card. But if you’re a non-student with a non-existent or bad credit history, a card that is secured or obtained with a co-signer may be your best option. With co-signed credit cards, the co-signer guarantees and is responsible for the debt. This means that the co-signing person is responsible for paying the full amount of the debt if the card holder doesn’t pay. In fact, when co-signed debt goes into default, three out of four times co-signers are normally asked to repay what is owed, according to the Federal Trade Commission.

Furthermore, the issuing bank can attempt to settle the debt without first trying to collect from the card holder. The bank can also use the same collection methods against the co-signing individual, including suing and garnishing wages. If the debt is not paid, it can leave a negative mark on the credit history of the co-signer, as well as the card holder.

Despite the risks, a co-signed credit card can be great tool for helping a friend or relative build their credit history so they can one day obtain a card on their own. Secured, co-signed and pre-paid credit cards offer viable options. But you should start building a strong credit history, so you can obtain a regular credit card on your own in the future.

First, you need to understand how credit card issuers determine credit worthiness. The approval criteria varies from among issuing banks, but generally relates to what’s often called the three C’s of credit: capacity, character and collateral. Capacity refers to your ability to pay based on your income and existing debt. Collateral refers to any assets you have that can secure payment, such as bank accounts or home ownership. Character refers to factors like your payment history, length of employment, etc.

To get a good idea about how your application will fare with credit card companies, check your credit history with one of the major credit reporting agencies: Experian (www.experian.com), Equifax (www.equifax.com) and TransUnion (www.tuc.com). These agencies access your payment information directly from the companies you have credit with, as well as from government agencies such as the legal court system.

Credit reporting agencies use the information in your credit history to determine your credit rating or credit score. Credit scores, also known as FICA or Beacon scores depending on the CRA, generally range from 350 to 850. Most banks will approve you for credit if your score is at least 620. If your rating is 720 or higher, banks will offer you their lowest interest rate.

Generally, y our credit score is determined by your payment history for the last two years. T echnically, CRAs calculate your score using a closely-guarded formula. TransUnion, for example, determines credit scores using a variety of factors, including: how you pay your accounts, how much you owe and how often you’ve applied for credit.

http://www.credit-cards-rates.co.cc/