businessman with a bad credit score or limited credit history will find it difficult to qualify for an ordinary business credit card , An alternative is to apply for a secured business credit card. A secured credit card is secured by a deposit and help build your company or establish credit again.
your credit score is not safe? Check your personal and business credit scores for with NAV dates. NAV does what as "soft credit Pull" is known, which do not adversely affect your credit score. If your credit score is below 620, you will probably have a difficult time to obtain a regular business credit card, and wish to pursue a secured business credit card. At the same time, you can to work on fixing your credit score with a credit repair agency as Lexington Law.
In this article we will help you decide whether a secured credit card for your business is and the qualities of a leader secured credit card from Wells Fargo.
summarized Best Secured business credit card: Wells Fargo Business Secured Credit Card
We recommend the map Wells Fargo Business Secured Credit because it helps you build your credit, while earn rewards. The annual fee and rewards program fee are a little on the high side, but that is common with secured credit cards. You can take advantage of a relatively low APR and access to a high credit line. We for the Wells Fargo card because it's just the only secured business credit card available nationwide to applicants.
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What types of financing are available for companies with bad credit? We look at 4 options in our Guide to Bad credit business loans.
| Wells Fargo Business Secured Credit Card | |
|---|---|
| card type | MasterCard Secured Business credit card |
| How do I apply? | required by phone or at a Wells Fargo branch nationwide |
| Credit Check? | Yes, but those who can qualify with bad credit or no credit score. |
| credit line / security Deposit | $ 500 to $ 25,000. Your credit line is the same as the amount you deposit in your account security. |
| Rewards Program | Yes, but in Rewards enrollment costs $ 50 per year (the first year waived). When signing up select Rewards Points:
|
APR on purchases | Current 13.4% (Prime + 9.0%) |
| balance transfers | not allowed on this card. |
| employee cards | Get to 10 employee cards, carrying each a fee of $ 25 / year |
| annual fee | $ 25 per card |
| Foreign transaction Fee | None |
What is a secured credit card?
A secured business credit card is intended for entrepreneurs who can not qualify for other business credit cards because of bad or limited credit history. By every month timely payments on a secured business credit card, you can build your credit and eventually "graduate" to an unsecured, normal business credit card.
Fast to qualify for a secured credit card, because you can always have to deal with the card deposit a "security account". Your credit limit is the amount of money that you put as collateral. For example, if you will be $ 2,000 $ 2,000 deposit in your account security, your credit limit on the card. This achieves two things. It forces only operating expenses that you can afford, and it protects the card issuer in case of default.
An alternative to secured credit cards for people with bad credit is to use a prepaid debit card. However, prepaid cards do not help you build credit, and you must be careful, because many of them are riddled with fees. If you are considering the prepaid route as we throttle Card from American Express, because it has the lowest fees.
Why do we recommend: Wells Fargo Secured Business Credit Card
We like secured the Wells Fargo Business Credit Card, because it has a reward program, a low APR , and a high credit line, all of which are atypical for a secured credit card.
to begin with, there are several secured consumer credit cards, but Wells Fargo is one of the few banks secured business offer credit card. a secured business to have credit card, is important for a few different reasons. First, it can help you build or establish your business credit score (in addition to your personal credit score), which is quite handy if you applied for a business loan. Second, a secured card will help you separate your business and personal expenses, because it can only be used for business purposes.
The conditions of this Wells Fargo card are pretty low for a secured card. Wells Fargo offers the possibility to pay $ 50 per year (the first year waived) in their rewards program to enroll. After registering, you can either back rewards points or cash, redeemable for gift cards to earn, travel and much more. The APR on this card is currently 13.4%, significantly lower than the 16% average for secured credit cards. Finally, you can use a line of credit as low as $ 500 and as high as $ 25,000 depending on how much money you have on hand to deposit.
On the other hand you have to pay both an annual fee of $ 25 per card and an annual $ 50 fee rewards, if you want to earn back rewards or money. This can be difficult for a small business, the already struggling from bad credit, especially one that is planning several employee cards to the exhibition. if you have enough to spend on the card each year, however, are the rewards points / cash back the fees be equalized. If you are diligent about making timely payments, you can finally to an unsecured card graduates that offers many more perks than a secured card.
How to apply
apply for a Wells Fargo Secured business credit card phone or in person at a branch of Wells Fargo. You can learn more about Wells Fargo and other top picks for small business checking accounts in our products by clicking here.
If you apply, you must both give your SSN and your EIN, if your company has one. Wells Fargo will draw your personal and business credit history. Even when they do a credit check as part of the application process, Wells Fargo is not require a minimum credit score to qualify for the secured business credit card.
Wells Fargo announces payments on this card for both the consumer and business credit bureaus. If you regularly make timely payments, you can increase both your personal and credit score business.
line of credit / deposit
Secured credit cards an initial deposit required, which is the basis of your credit line . The line of credit to a Wells Fargo secured card can reach $ 500 $ 25 000
When you opena secured business credit card, Wells Fargo will open an associated security account for you. The first deposit in your account security will be your line of credit. For example, if you in your account, your monthly credit limit is $ 1,000. $ 1,000 carefully
Make sure you select your deposit amount deposit. If you want to add more funds later, this will be treated as a request to increase your credit line and requires a second credit check. If you want funds from the account stand out, this is treated as a cash advance and subjects you to a higher 24.24% April
Most secured cards in the same manner as Wells Fargo work, but a few will limit your line of credit to a certain percentage of your deposit. For example, you 'extends BBVA Compass secured business credit card, a credit line, which is 0% of the deposit in your account security.
Rewards points / cashback
These days, most people won 't even consider an unsecured credit card, if not offer rewards programs. Now cards catch backed up on the trend. For a $ 50 annual fee waived the first year, you can enroll in Wells Fargo Business Rewards program. This fee covers the principal cardholder and all employee cards on the company's account. After registering, you can earn either rewards points or cash back.
cashback means you earn $ 1 spent for every $ 100 on the map. Points means you earn 1 point for every $ 1 spent on the card. We recommend back the dial points above cash for this card because it offers more flexibility. You can earn points for gift cards, hotel redeem, traveling, or if anything your imagination suggests on the rewards catalog, trade in your points for a statement credit.
Wells Fargo provides bonus points or return for cash customers who regularly use the card. Every month, the least $ 1000 outputs your business as a whole (including all staff fees) on the map, you will receive 1,000 bonus points or a $ 10 cash bonus reward credited your card account or deposited your eligible checking or savings account.
There are two caveats to the points of choice, but. The first is that their value will vary based on what you redeem them for (for example, gift cards, travel, etc.). The second is that Wells Fargo Business Rewards points expire after 3 years, but cash back never expires.
If you are a normal, unsecured credit card with a fantastic program points out Chase Ink and Amex looking business cards.
April and balance transfers
It is always advisable to pay off your credit card balance in full each month. This is true for everyone, but is especially recommended for someone who is trying to rebuild their credit with a secured card. If you need to keep a balance, it is advisable to pick a card with a low APR.
April, to borrow the cost of money on your credit card. The effective interest rate for Wells Fargo is currently 13.4%. The APR on purchases for this card is (currently 3.50%) calculated by summing the prime rate and 9.0%. At 13.4% in April is actually quite small compared to what some business credit cards, such as Capital One Spark cards charge. Our recommended card, Chase Ink Plus charges more interest. This is a clear advantage of Wells Fargo Secured Card; when you try to credit, the last thing you want to do to repair is a high interest rate.
Since April is bound by this card to the prime rate, it can change to market conditions. Credit card interest rates have dropped dramatically in recent decades. While there is no guarantee this trend will continue in the future, there are not a lot of differences from year to year as a rule.
Remember that your regular April can change under different circumstances. If you are late with a payment, you can get a higher penalty April compared. If you withdraw money with your credit card (advance) or withdraw from your credit line (overdraft), you may be subject to a higher April and other fees. Always check your cardholder agreement carefully so that you understand your April Cards are not credit card accountability responsibility and Disclosure Act (or CARD Act) covered, regulates the interest rates on consumer credit cards.
Wells Fargo Secured Business Card does not allow balance transfers. A balance transfer can help people with credit card debt by lowering their debt at a low or no-interest credit card their monthly payments. Capital One Spark cards are the best options for balance transfers, but you need to qualify excellent credit.
annual fees and foreign transaction fees
Unlike April, you only affects when a balance carry annual fees and foreign transaction fees apply to all cardholders.
The Wells Fargo secured credit card charges an annual fee of $ 25. This is on top of the $ 50 fee that is charged for the rewards program. While this seems to be high if you (give you $ 75 cash back) at least $ 7,500 per year on your card, it is equivalent to the annual fee and rewards program fee.
Secured cards typically carry an annual fee of around $ 20 -40. Some consumer cards securely (see list here) carry no charge, but you will not be business credit help build.
This card can not have a foreign transaction fee has that a good choice for business owners who travel frequently.
employee cards
If you have employees, you can use a credit card to want to spend to use for business purposes.
Wells Fargo will issue up to 10 employee cards (not to say the map, "backed up" to). Your credit line will be allocated among the employees, and you have to Wells Fargo call the spending limit on each employee card specify.
for each employee card you have to pay $ 25 annual fee. However, the $ 50 annual fee rewards covers all cards on the company's account. All personnel expenses generate rewards points / cash back for your business. For example, if your employees together $ 1000 to be calculated on the card in a month, your account will receive $ 10 cash back or 1000 points.
Bottom Line
If you have poor or limited credit, but money put towards a deposit, you are the ideal candidate for a secured credit card. Wells Fargo Business Secured credit card can help you create or build business credit again, and it has a relatively low APR, line high credit if you pay a corresponding amount and rewards program.
The card has an annual fee of $ 25 per card and a rewards program in the amount of $ 50, but most companies this charge is balanced with their annual expenditure. Not to mention, if you enroll in rewards, you'll earn points and cash back. Eventually you will be able to get an unsecured card if you build secured with the card your credit or rebuild.
A poor or limited credit history does not mean that you do not get business financing. We highlight four lenders that loans for companies with bad credit in our Bad credit business loans guide
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