I have applied at several local banks for a credit card and have been rejected because I have no security. They all say that beause I never had a card before I would have to get a "secured" one which they explained that I would have to put money in an account as sort of a back up. Now where is a 20 year old single mom with 2 childern going to get that much money? I tell them if I had money I wouldn't need a credit card. Then they just apologize and say they can't give me credit. Forgive my stupidity but what's the point then of a credit card then if you have to pay back the money you spend? Getting desperate! Parents won't give me anymore either.
A credit card isn't "free money". You do have to pay for the items you "charge" whether you use a "secured" card or an "unsecured" card. A bank or a credit union wants to know that they're going to get their money back and that's why you're only being offered a "secured" card. If you want to establish credit, a good financial history, you will need to save some money in an account and it can be as small as $5.00 or $10.00 a week. A credit union may be a bit more liberal in policies but with the details you're offering they would probably only give you a small secured card. Ask your local credit unions about passbook or saving account memberships and the minimum required to open an account. The credit union or the bank is not going to be interested if you have two children, they're looking out for their bottomline and will want to know if you're a good risk. You've got to prove you're a good risk by establishing a history of prompt payment and savings is another factor considered. If you only have $2.00, add it to your savings. It will grow.
"Forgive my stupidity but what's the point then of a credit card then if you have to pay back the money you spend? " The only point of a credit card from a bank's perspective is that purchases charged to it are paid, and if it is not paid in full each month then interest is paid with at least part of the balance. If you don't have enough for a secured card, you need to look at the income and expense sides of the equation. Borrowing will only make your position worse.
