Valued Contributor
Posts: 1,632
Registered: ‎01-23-2013
Re: Starting Credit

Also, once you get a secured credit card, you can spend, then pay it off, spend then pay it off. There is no requirement for spending the amount you deposit, and you are not limited to spending only $700. It's just that you can carry a balance of no more than $700 at a time (assuming that your credit limit is also $700; sometimes the deposit and credit line may be different).


As you pay off whatever balances you run up, your credit line renews, so you have that spending power all over again.


Another thing to know, and this is very important, you should try NOT to carry a $700 balance on a card with a $700 limit. In fact, you should carry only a tiny fraction of that. When a card reports to the credit bureaus with most of its credit line used up, that's called maxing the card out and it really HURTS both your credit score and your reputation with the lender.


I know at this point everything probably seems confusing. If anything isn't clear, just keep asking questions.