If you have a poor credit history, or an insufficient credit history for creditors to make a judgment as to your ability to pay your monthly credit card bill, then a secured credit card may be the right option for you to start building a positive credit report and transition to an unsecured credit card. This is especially true in today’s economic climate, as financial institutions have lost billions from subprime mortgages.

Secured credit cards are often tailored to appeal to people with bad credit. In some cases, they come with offers such as guaranteed approval and no credit check so that those looking for a credit card with bad credit will have an option other than a debit card.

A secured credit card uses a deposit made by you to ensure that you make your monthly credit card payments. Your credit limit is a percentage of your deposit. Depending on the terms of your credit card, if you miss an amount of payments specified in your cardholder agreement, the secured credit card issuer can seize all or a portion of your deposit.

In order to build your credit rating, you’ll want to make sure that the secured credit cards you are considering report your payments to the three major credit bureaus. If your payments aren’t being reported, then you aren’t helping to build your credit history.

You’ll also want to shop around for a secured credit card, as the terms and conditions by issuers vary widely. Secured cards typically have higher fees and higher interest rates than unsecured credit cards. They also may have application and processing fees which aren’t typically found on an unsecured card.

We’ve put together a list of a couple secured credit cards to check out if you are looking for one:

New Millennium Bank Secured Gold Visa® or Mastercard® - New Millenium Bank offers a secure credit card with a credit limit of between $300 and $5000 backed by your savings account. It offers a chance to rebuild your credit by reporting to all 3 credit bureaus.

First Option Visa® - First Option offers guaranteed approval regardless of credit history or income for a real Visa credit card with a secured credit line up to $5000.

Public Savings Bank Secured Card - Public Savings Bank offers 0% APR on purchases for the first six months, reports to all three major credit bureaus, and has no income or credit requirements.