You might’ve heard about the infamous Chime Credit Builder Card and wondered if it would suit your needs. Well, this one is very different from the usual secure credit card. Let’s see who this card is made for.
Getting A Chime Credit Builder Card
That’s true – the Chime Credit Builder Card has a few similarities with the secured credit card. Both of them are made to build a proper credit history, and that’s the only major point they share. Chime Credit Builder Visa comes without annual fees. Moreover, the customer applying for a card doesn’t have to create a minimum security deposit or submit a credit check. That’s not all! There’s no interest to pay for this particular card. While it sounds perfect for building credit, it’s still not made for every user.
Getting a Chime Credit Builder Card doesn’t require any usual submissions, but it does ask for a Chime Spending Account. This account can’t be empty, too. The new card owner has to deposit at least $200 in direct deposits in the past year. In case the user needs a card without a bank account, they can look for the OpenSky® Secured Visa® Credit Card instead. Simply use a debit card, check, or Western Union to fund it.
Chime Credit Builder Card’s Benefits
In addition, this card might remind the owner about their debit card. The money is not deposited to the credit limit – instead, the user transfers it from the Chime Spending Account to the Credit Builder secured account on the Chime app. There’s a way to create automatic transfers, and all that money is free to spend when needed. The Chime Credit Builder Card doesn’t charge interest, too. Credit bureaus have no access to the credit utilization of Chime customers, although the payment history and other important statements are reported.
Automatic payments such as monthly bills are also available. The Safer Credit Building feature will put the money from purchases on hold until there’s a bill to pay. Then, this money from the Secured Credit Account will go towards paying the bills, saving the user from late and missed payments.
Cons Of Using Chime Credit Builder Card
Although the Chime Credit Builder Card has its benefits, there are a few setbacks to using it. First of all, it won’t earn any rewards in cashback. So, in case that’s something you deem essential, opt for other cards like Discover it® Secured Credit Card. Secondly, the Chime card is extremely unique. And while it’s a great thing in itself, that also means any other card will work differently. Even when the user gets another credit building card, later on, they won’t be able to figure out how it works.
Then, an unsecured credit card will have an interest rate, proper fees, and even a credit limit. The traditional card user will have to spend up to the limit and get into debt. Apart from that, late and missed payments are a huge no-no. The owner of the card has to pay fees and face a high interest rate when they are late. Also, credit score suffers a lot after that incident.
So, don’t forget to check if the Chime Credit Builder Card really suits your needs – all in all, it will surely help anyone build their credit score.
Sources: Chime, NerdWallet