Creditnet News Story
Secured credit cards an option for students
Thursday, February 25, 2010
By Linda McCarthy
New law makes it harder for young people to build credit score.
Given new rules put forward by the Credit Card Accountability, Responsibility and Disclosure Act, younger people may be left wondering how it is they can increase their credit score.
Through the new rules, people under 21 are going to have to get a co-signer in order to take up credit card offers. That or they'll have to prove they generate enough of an income to support having a card.
However, one option young people may be able to tap into is a secured card. Personal finance expert Liz Pulliam Weston recently noted that these types of cards can help young people establish a credit history.
"You'll want a card that reports to all three credit bureaus and that has an annual fee under $75," Pulliam Weston wrote on her website.
Young people are not the only segment of the population that may be able to benefit from the use of secured credit cards. Experts have noted that companies may be more likely to give consumers without a credit history such an account because of the funds people have to put up to guarantee payments.
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