Which Of The Following Types Of Credits Would Best Describe Credit Cards?

Which Of The Following Types Of Credits Would Best Describe Credit Cards?

 

A. Open and unsecured 

B. Open and secured

C. Closed and unsecured

D. Closed and secured

This is one question that anyone desiring to own a credit card needs to answer. 

Which Of The Following Types Of Credits Would Best Describe Credit Cards? – The Answer

To answer the question of which of the following types of credits would best describe credit cards? highlighted above is “A”. Credit cards are more often than not described as being “open and unsecured”. When applying for a credit card from a bank or credit card issuing company, you are not normally required to provide any form of collateral. Neither are you required to make a security deposit of sorts. What is required from a bank or credit card issuing firm, is your FICO credit score, evidence of age, source of income and also your social security number. Having a history of “good credit” will also enhance your chances of getting a credit card. 

Which Of The Following Types Of Credits Would Best Describe Credit Cards? – Bad Or Poor Credit

Credit cards confer a line of credit to their owners. So card issuers need to know if customers are capable of paying back such credit with interest at a scheduled time. According to FICO, having a credit score ranging from 300 to 650 is considered as “bad”. However, some credit card issuers would consider giving customers unsecured credit cards even though their credit score is as low as between 550 and 650. These credit card issuers consider such credit score as “poor” and not “bad”. They also believe that the customer could improve their credit score over time with consistent debt settlement as at when due.

Which Of The Following Types Of Credits Would Best Describe Credit Cards? – In Conclusion

Now that you know the answer to the question – Which of the following types of credits would best describe credit cards? stated above.

You also know what is needed to obtain an open and unsecured credit card from a card issuer. So what is your current FICO credit score and do you qualify for a credit card?