WHAT ARE PREPAID CREDIT CARDS

Many people are rejected after filling out a credit card application because of poor credit. The problem with this is that a major credit card is needed to make reservations for hotels, motels, car rentals and airline flights. Credit cards are also necessary when placing orders online or over the phone. Does this mean a person with bad credit can't do any of these things? Not if that person has a prepaid credit card.

A prepaid credit card account is opened by depositing money into that account, much in the same way you would make a deposit to open a checking or savings account. Once you have money in your account, you're issued a prepaid credit card that can be used anywhere one would use a regular credit card. The best part of the prepaid credit card is that you can charge to your heart's content and you won't be in debt. The money is yours and once it's gone, you can't spend any more until you make another deposit. There are no bills and no interest charges. It's the same principle as using a debit card linked to a savings or checking account.

So what's the catch? First, you'll have to pay a fee to set up your account. The amount varies, but you can probably expect to pay about $5 to $10 to open a prepaid credit card account. For those with bad credit, the benefits of a prepaid credit card far outweigh the risks. They're able to reserve rental cars or hotel rooms, and don't have to worry about credit card bills and interest payments later.

If you're frustrated because a credit card is necessary to get by in today's world, but can't apply for one because of bad credit, you might consider a prepaid credit card. You'll have most of the advantages of a credit card, and you won't have to worry about interest charges. Still not convinced? check out the benefits of prepaid credit cards, Have questions about prepaid credit cards? Find your answers at our frequently asked questions section.

Apply for a prepaid credit card today.