Defaulters: We deserve good credit card rates

Hand holding credit cards

Medical bills, unemployment, slashed wages and a penchant to overspend are just a few of the reasons Americans default for the first time on their credit cards, according to a recent report by the Deloitte Center for Financial Services.

And since defaulting can leave a dent in a credit score, a number of banks are offering these first-time defaulters (along with others whose credit scores have taken a beating over the past few years) secured credit cards.

But first-time defaulters have limited interest in these cards, according to the survey. And nearly half think they should get the best lending rates banks have to offer.

Because secured credit cards require consumers to make a deposit against a line of credit, they reduce issuers' risk.

Some consumers even look to secured cards with hope because these cards often prevent a person from incurring over-the-limit fees. You can’t spend more than the deposit you make.

From the report:

"It has been anticipated by many based on historical experience that secured cards and other alternative credit products would be the only source of consumer credit for individuals that have had significant credit trouble. However, at this time this group appears to have continued access to revolving credit products."

More than two-thirds of first-time defaulters reported they were "not at all interested" in a secure card.

Additionally, 43% of first-time defaulters stated they believed they were worthy of the most competitive rates a bank/lending institution has to offer on its loan products. (Compare that to 67% of the total survey sample.)

Indeed, credit appears to be available to some first-time defaulters, just perhaps not at the lowest rates:

If you are in the market for a secured credit card, we know of a few good deals.

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