The OpenSky Plus Secured credit card is a type of secured credit card, which means that it requires a security deposit that becomes the cardholder’s credit limit. Unlike traditional credit cards that extend a line of credit based on the card issuer’s funds, a secured credit card uses the cardholder’s own money as collateral. This makes it an ideal option for individuals looking to build or rebuild their credit. The OpenSky Plus Secured card offers credit limits ranging from $300 to $3000, depending on the amount of the security deposit.
Benefits of a Secured Credit Card
A secured credit card requires the cardholder to provide a security deposit, which becomes their credit limit, while a traditional credit card extends a line of credit based on the card issuer’s funds.
- Enables individuals with limited or poor credit history to establish or improve their credit score
- Provides a low-risk borrowing option for both the cardholder and the card issuer
- Offers similar functionalities and benefits as traditional credit cards
How does the secured deposit work with the OpenSky Plus card?
The secured deposit with the OpenSky Plus card functions as the cardholder’s credit limit. When applying for the card, individuals are required to deposit an amount between $300 and $3000, which becomes their credit limit. This deposit serves as collateral and mitigates the risk for the card issuer, as the cardholder’s own funds secure the credit line.
Process of Securing a Credit Limit
Upon approval for the OpenSky Plus Secured card, individuals need to transfer their chosen amount for the security deposit to OpenSky. This amount will then determine their credit limit, and they can begin using the card for purchases and payments up to this limit.
Recovering the Secured Deposit
Cardholders can retrieve their secured deposit by closing their OpenSky Plus Secured card account. Upon account closure, the card issuer will return the security deposit, provided that the cardholder has settled any outstanding balance on the card.
What are the credit limit options and requirements for the OpenSky Plus card?
The OpenSky Plus Secured card offers credit limits ranging from $300 to $3000, depending on the amount of the security deposit. This allows individuals to choose a credit limit that aligns with their financial capabilities and needs.
Credit Limit Options
- Available credit limits range from $300 to $3000
- Depositing a higher amount results in a higher credit limit
Credit Limit Requirements
Individuals are required to deposit a minimum of $300 to secure the OpenSky Plus card. This deposit becomes their credit limit, providing a straightforward and accessible option for establishing or rebuilding credit.
Can the OpenSky Plus card become unsecured after a certain time?
After the first six months of holding the OpenSky Plus Secured card, cardholders have the opportunity to request the card to become unsecured. This process may also lead to a potential credit line increase, offering additional financial flexibility without the need for an increased security deposit.
Transition to Unsecured Status
Upon demonstrating responsible card usage and making timely payments for at least six months, cardholders can request the transition of their OpenSky Plus card to an unsecured status, potentially leading to a credit line increase.
Opportunity for Credit Line Increase
By transitioning to an unsecured status, cardholders may be eligible for a credit line increase, allowing for greater purchasing power without the need for an additional security deposit.
What is the best way to use the OpenSky Plus card to build credit?
Upon receiving the OpenSky Plus Secured card, it’s crucial to prioritize paying off the balance in full and on time every month. Setting up autopay can ensure timely payments, or alternatively, marking the due date on your calendar can serve as a reminder. Consistently paying off the card in full and on time is essential for building a positive credit history and improving your credit score. This responsible use of the card demonstrates financial reliability and creditworthiness, setting the stage for future credit opportunities.
Importance of Timely Payments
Consistently paying off the card in full and on time is essential for building a positive credit history and improving your credit score.
Setting Up Autopay
Consider setting up autopay to ensure that the payment is made automatically every month on or before the due date, preventing any risk of late payments.
How can you keep your credit utilization ratio low with the OpenSky Plus card?
To maintain a low credit utilization ratio with the OpenSky Plus Secured card, it’s important to keep your statement balance well below your credit limit. Aim to keep your credit utilization ratio below 30%, with an even better target being below 10%. For example, if your credit limit is $500, strive to keep your statement balance below $150 to stay below the recommended 30% threshold. Keeping your credit utilization low demonstrates responsible credit management and positively impacts your credit score, paving the way for future financial opportunities.
Maintaining a Low Credit Utilization Ratio
Aim to keep your statement balance well below your credit limit to maintain a low credit utilization ratio, demonstrating responsible credit management.
Impact on Credit Score
Maintaining a low credit utilization ratio positively impacts your credit score and enhances your creditworthiness, opening doors to future financial opportunities.
What are the APR and fees associated with the OpenSky Plus card?
The APR for purchases and cash advances on the OpenSky Plus card is 29.24%, which is notably high. It’s crucial to prioritize paying the balance in full every month to avoid accumulating interest at this rate. Additionally, cash advances incur a fee of $10 or 3% of the amount, whichever is greater. For those who travel abroad, a foreign transaction fee of 3% applies. Late payments and return payments may result in a fee of up to $40, emphasizing the importance of timely payments.
APR Details
- Purchases and cash advances: 29.24%
Fees
- Cash advances: $10 or 3% of the amount
- Foreign transaction fee: 3%
- Late payments and return payments: Up to $40
Importance of Timely Payments
Given the high APR and potential fees, it’s essential to prioritize timely payments to avoid incurring additional costs and to maintain financial stability.
Is there an annual fee for the OpenSky Plus card?
One notable advantage of the OpenSky Plus Secured card is the absence of an annual fee. This means that individuals can work on building their credit without the burden of an annual fee, distinguishing it from many other secured credit cards in the market.
What are the main pros of the OpenSky Plus Secured Credit Card?
The main pros of the OpenSky Plus Secured Credit Card include:
Easy Approval
- Accessible for individuals with limited or poor credit history
- Opportunity to build or rebuild credit without stringent credit score requirements
No Annual Fee
- Absence of an annual fee distinguishes it from many other secured credit cards
- Allows individuals to work on building their credit without incurring additional costs
Potential for Credit Building
- Opportunity to start building credit and progress to better credit cards with improved reward systems
- Provides a platform for individuals to establish a positive credit history and move on to more advantageous financial opportunities
What are the main drawbacks of the OpenSky Plus Secured Credit Card?
The main drawbacks of the OpenSky Plus Secured Credit Card are:
High APR
- APR of over 29% could lead to substantial interest charges if the balance is not paid in full every month
Foreign Transaction Fee
- Imposes a 3% foreign transaction fee, potentially increasing costs for international purchases
Initial Deposit Requirement
- Requires individuals to deposit their own funds as collateral, potentially impacting available cash in the short term
- May pose a financial challenge for those with limited funds in their checking account
Despite these drawbacks, responsible use of the card can lead to opportunities for credit growth and progression to other credit options.
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