While secured credit cards are a great option for individuals building or repairing credit history, interested individuals need to beware of deceptive advertisements and secured credit card marketing scams. Secured credit cards require users to open a savings account with the company’s bank in order to set their credit limit. From there, account usage and payments are reported to the credit bureau to (hopefully) establish good credit.
Unfortunately, many scams exist that prey on those who need secured services. Buyers must make cautious selections when looking for secured cards.
Deceptive Ads and Scams
Over the years, the Federal Trade Commission (FTC) has taken action against companies that advertise fraudulent credit card offers via television, newspapers, and postcards. These ads may offer secured or unsecured credit cards, or may not even specify the card type.
Most of the ads lead you to believe you can get a card by calling a listed number. The number may require you to pay toll and may only instruct you to call another tolled number. After paying for the calls, the only service received may be a list of banks that offer secured cards or a mailed credit application.
Most scam advertisements leave out important information to improve the scam’s success. Here are some things often omitted:
Unfortunately, many scams exist that prey on those who need secured services. Buyers must make cautious selections when looking for secured cards.
Deceptive Ads and Scams
Over the years, the Federal Trade Commission (FTC) has taken action against companies that advertise fraudulent credit card offers via television, newspapers, and postcards. These ads may offer secured or unsecured credit cards, or may not even specify the card type.
Most of the ads lead you to believe you can get a card by calling a listed number. The number may require you to pay toll and may only instruct you to call another tolled number. After paying for the calls, the only service received may be a list of banks that offer secured cards or a mailed credit application.
Most scam advertisements leave out important information to improve the scam’s success. Here are some things often omitted:
- The cost of the call to the 900 number; calls can range from $2 to $50
- Required security deposits, application fees, or processing fees
- Eligibility requirements
- Credit card terms (annual fees, interest rates, etc)
