Why Orchard Bank Secured Credit Card?
The fact of the matter is that consumer bankruptcy filings are on the rise as mortgage defaults, foreclosures and job losses continue to mount. Under these circumstances it is not a surprise that many people have a hard time qualifying for conventional credit cards and in some cases it
may not be possible at all. The good news is that the Orchard Bank Secured Credit Card offers a good value for people with bad credit scores to help them rebuild credit history after a serious financial setback.
Who Is Orchard Bank Secured Credit Card For?
If you are someone with no credit history looking to get their first credit card, if you have been turned down for a credit card before or if you are trying to rebuild credit after a bankruptcy or foreclosure, Orchard Bank Secured Credit Card might just be the right solution to help you in rebuilding credit.
Orchard Bank Secured Credit Card Review
This secured card from Orchard Bank , a subsidiary of HSBC, offers surprisingly low fee structure and provides a good value, not only compared to other secured cards on the market but also compared to Orchard Bank's own line of conventional, unsecured credit cards. As a matter of fact, this Secured Credit Card is a much better deal than any other Orchard Credit Card, provided that you can and you don't mind having to pay a security deposit.
Interest Rate and Annual Fees
Orchard Bank Secured Credit Card carries a very low 7.90% variable purchase and balance transfer APR interest rate. Penalty interest rate is 29.49%. The $35 annual fee is waived the first year and there are no account processing or application fees. Balance transfer fee is 5% of the balance ($5 minimum) and Cash advance fee is 5% of the transaction amount ($5 minimum). There are many other Secured Cards that will charge you to apply. Even Orchard Bank charges up to $39 application fee for some of its Unsecured Cards.
The $35 annual fee is waived the first year and it's also very reasonable especially since after you pay your bills on time for a while, you might be able to qualify for an unsecured card with no annual fee. If we take in to a consideration that the other Orchard Credit Cards carry
annual fees ranging anywhere from $19 to $59 for the first year it is easy to see that the Orchard Bank Secured Credit Card provides a much better deal.
Orchard Bank Secured Credit Card Pros
- Low interest rate.
- No application fee.
- No account processing fee.
- No annual fee the first year ($35 annual fee thereafter).
- Reports your account activity to the three major credit bureaus.
Orchard Bank Secured Credit Card Cons
- Security deposit is required to open an account (minimum $200).
- Low credit limit (up to the size of the security deposit).
- No customer rewards.
Security Deposit - The bank requires you to pay a minimum security deposit of $200 to qualify. The amount of your credit card security deposit is equal to the size of your credit limit. This protects the bank in case you default on your payment obligations. Putting up a deposit seems to be a relatively small inconvenience to get a credit card especially if other banks have denied your credit application before.
Credit Reporting - Orchard Bank says that it automatically sends out monthly reports to all of the three major credit bureaus. This should have a positive impact (assuming you pay your bills on time and keep your credit card balance within 30% of your credit limit) in helping you improve your credit score.
If you can only qualify for credit by getting a secured card, you'll find this card to be a good choice to rebuild your credit history. There are many other Bad Credit Card Companies that offer a lot worse terms, interest rate and fees than this card. However, you will need to pay your credit card bills on time because if you don't you will not only get another negative item in your credit file, but you may risk losing your entire security deposit as a result.