Unsecured Credit Cards
As the title states, unsecured credit cards
are issued by the credit card
company without any collateral or even a check issued on your personal bank account. Unlike secured credit cards
which are normally issued on the basis of a savings account you fund, unsecured credit cards are issued at the discretion of the credit card company
. Your word and commitment to repay the dues on the card is the only security the credit card company has. They cannot re possess items you have purchased on the card and nor can they create any claim on your house or other property. Unsecured debts are normally discharged at bankruptcy. Since the credit card company has no recourse to getting back their funds other than depending on your commitment, the interest rates
on unsecured credit cards may be high.
Unsecured credit cards
normally have revolving credit which allows you to make part payments on the total amount due.
However, other than the fact of the higher interest rate and the unsecured nature of the credit card, it utility is exactly the same as a secured card
. You can use it for all of your purchases and the unsecured nature of the card will make no difference to the establishment making you the sale.
Secured Credit Cards versus Unsecured Credit Cards compared the 2 types of credit cards and helps you choose the ideal kind for you.