Credit Cards
How To Deal With Credit Cards - A Definitive Guideline
By Vikas Aditya
Various types of credit cards are available in the market. They have evolved from their early days into flexible financial tools for most types of spenders and savers. But with so many types of credit cards on offer it can be somewhat overwhelming. Few examples are Airline credit card, Balance transfer credit card, cash rebate credit cards etc.
- How to choose the Right Card?
- Applying For Credit Cards Online
- How to decide which credit card is suitable for me?
- Rate Tart Are You One?
- Quick Balance Transfer
- 0% Balance Transfers What's The Buzz?
- Cash Back Credit Card
- The Value Of Having Branded USA Credit Card Loyalty Programs
- Secured or PrePaid Credit Cards
- Airmile Credit Cards
- Business Credit Cards
- How To Manage Your Store Card
- Identity Theft
- Payment Protection Cover For Your Credit Card Is It Worth The Cost?
- Credit Card Charges
- Smashing The Credit Rating Myths
- Credit Building Tactics
- Credit Reports
- Credit Card Options For People With Bad Credit
- Do You Need To Have More Than One Credit Card?
- Credit Card Disadvantages
- Common Credit Card Mistakes
- Are PreApproved USA Credit Cards A Scam?
- Visa or Mastercard?
Author has done significant research in the credit card industry and edits Best Credit Card Deals Online! [http://onlinecreditcards.ecreditdirectory.com]
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By [http://ezinearticles.com/?expert=Amy_Cooper-Arnold]Amy Cooper-Arnold
Whether you have no credit or damaged credit, secured credit cards are a good tool for building a good credit history.
Several months ago Tom, a member of rel=nofollow [http://CreditBoards.com]CreditBoards.com, filed for a Chapter 7 Bankruptcy. Now he is in the process of rebuilding his credit history. It's a task that is not easy, but with patient persistence he is seeing progress already. Daily he checks his credit score and is slowly seeing improvement.
1 - In addition to correcting every mistake, even the smallest ones, on his credit report, he is using a secured credit card.
2 - This secured card is an important tool in the overall process of building or rebuilding credit.
Who should consider a secured credit card?
Someone who has no credit history.
Someone with a damaged credit history.
What is a secured credit card?
Secured cards are credit cards opened with a deposit into a savings account, money market or certificate of deposit. The amount of deposit required varies from card to card, but generally minimum amounts range from $250 - $500. These funds are considered your security and will even earn a little interest since they are being held in a savings account. Your credit limit is determined by the amount you deposit into the savings account. Sometimes the limit will be for the full amount of the deposit; other times it will be a percentage of the total.
It is important to keep in mind that a secured card is a credit card, not a debit card. If full payments are not made each month, then interest is charged on the outstanding balance. And the lending institution uses the security money to pay off the debt only as a last resort. Even though the card is secured, it is still possible to damage credit.
What are the benefits of a secured credit card?
Establishing credit. If you have never had a credit card, a good first step in establishing good credit is applying for a secured credit card. Assistant Professor of Economics at Austin Peay State University in Clarksville, TN, Jerry Plummer says, "A secured card is most useful for the person starting out on their credit history, since it says that the person is willing to take the extra step to establish credit."
Reestablishing credit. If your credit history is damaged, you may only be able to qualify for a secured credit card. Using this secured card appropriately and within the set parameters will help rebuild your credit and qualify you for an unsecured card. If you have had to file for bankruptcy, however, you may not qualify until it has been discharged.
Preset limit cannot be exceeded. If poor spending habits were part of the cause for bad credit, then a secured credit card will help keep spending in check.
Useful for transactions that require a credit card. Hotels and car rentals require the use of a credit card. If you don't qualify for an unsecured card but you do for a secured card, then you are still able to make the transaction.
What should I look for or avoid when shopping for a secured credit card?
Fees. This is the area you will really want to research when shopping for a secured credit card. Some cards will come with fees that run into the hundreds of dollars, eating away much of the credit you secured with the savings account. Professor Plummer says a card with no fee is the best, but a small one-time fee can be okay. Annual fees for attractive secured cards typically range from $20-$35. Be sure to watch out for hidden fees such as "registration charges" and "setup fees."
Interest Rate. Just because you have no or poor credit doesn't mean you have to settle for the highest interest rate. Interest rates for attractive secured cards should not exceed 19%. Shop around and get the most competitive rate available.
Read the fine print. Linda Tucker, Director of Education for Consumer Credit Counseling Service for Arkansas and Memphis, TN, stresses the importance of reading the fine print. Doing so will let you know your exact obligations to the issuing company: for example, the grace period, what happens if you don't make a full payment, and what fees are attached if you don't make the full payment. Understanding these details will help make sure you are not further damaging your credit.
Fraudulent Offers. As with unsecured cards you need to watch out for fraudulent offers.The Federal Trade Commission gives the following advice to protect yourself from credit card fraud:
Offers of easy credit. No one can guarantee to get you credit. Before deciding whether to give you a credit card, legitimate credit providers examine your credit report.
A call to a '900' number for a credit card. You pay for calls with a '900' prefix -- and you may never receive a credit card.
Credit cards offered by "credit repair" companies or "credit clinics." These businesses also may offer to clean up your credit history for a fee. However, you can correct genuine mistakes or outdated information yourself by contacting credit bureaus directly. Remember that only time and good credit habits will restore your credit worthiness.
When will I qualify for an unsecured credit card?
It can take several months to see an improvement in your credit history. Bankrate says it's a good indicator when you start receiving flyers in the mail for unsecured cards that your credit is improving. However, it's a good idea to continue taking things slowly. Using a secured card will help you learn healthy habits so that when you do get an unsecured credit card you remain in control of your spending and credit.
Where can I find a secured credit card?
Most companies don't advertise secured cards. But you can visit the Card Reports section of rel=nofollow http://www.CardRatings.com to find out where and how to apply. Click on the link entitled "Cards for Consumers with Poor or No Credit".
Other tips
Tom recommends sticking with only one or two cards and keeping spending to a minimum. The goal is to pay the card off each month.
Tucker emphasizes the importance of paying the amount due each month; otherwise late fees can be charged, interest rates raised, privileges lost, and credit history negatively affected.
Make sure you are getting a credit card as opposed to a gas card or a department store card.
Make sure a reputable bank or credit union, even a local one, is issuing the card. And, don't automatically assume a bank is issuing the card.
Not all issuers report to the three major credit agencies (Experian, Equifax, and TransUnion). It's important to get a card that does report to all three agencies; otherwise you will be wasting your time. Fortunately, secured cards normally report to the credit agencies just like unsecured cards (you should verify this before applying).
If you have filed for bankruptcy, you may need to wait until it has been discharged before qualifying for a secured card.
Get one only if you cannot get credit, since you have no credit record; or if you have poor credit. Plummer says, "Many companies will not even count them as credit, such as automobile F&I (Finance and Insurance) people, although they will not admit it." So, if you don't really need a secured card, you will be doing more harm than good.
Finally, whatever situation you are in, no credit or poor credit, the best way to build good credit is to set up a budget and then stick with it.
1 You can pay membership fees to any one of the three credit bureaus - Experian, TransUnion, and Equifax- to be able to check your credit score online daily. Visit our Credit Information section for more details. Tom recommends purchasing Microsoft Money 2004, which comes with a one-year membership to Experian (value of $99.00).
2 To find out more about correcting errors on your credit report, read our article How to Correct Mixed or Split Credit Reports.
Amy Cooper-Arnold is a staff writer for http://www.CardRatings.com. Amy has been employed in various accounting-related positions. She will graduate this December from Austin Peay State University with a degree in English.
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Credit Cards For People With Bad Credit, No Credit, And Poor Ratings
By Sunny Kesh
We live in the world of credit. Most of the banking institutions offer different forms of credit from credit card to signature loans.
Majority of people often find themselves in bad credit situations like court judgment, bankruptcy, repossession, foreclosure and loan default,due to lack of enough financial knowledge and discipline which often make it difficult for them to get any credit at all in future. So - what exactly is credit?
Credit means that you are getting a service or cash grant to rent for your own purpose. You are often bound with a contract or agreement to repay in future as agreed with lender or service provider. Credit exists in different forms like loan, mortgage, signature loan, or credit card.
Every financial institution or lending agency, will first check your credit history, before they will consider giving you credit. If you have defaulted on credit or loan before or have bad credit history you will find it almost difficult to get credit any time you apply for it.
However, it's possible for you to improve your bad credit history or build a new good credit history by repairing your bad credit, thus re-establishing your credit-worthiness. This process is called credit repair. It's the process in which consumers with unfavorable credit histories attempt to re-establish their credit-worthiness.
Though there are lots of credit repair companies nowadays that promises repairing your bad credit for you, but if you can follow simple guide, it's very possible for you to do it yourself - after all it's your credit.
If you repair your bad credit it will make it easy for you to get low interest credit, car or home loans. However, with poor credit rating you may not be able to get loan or be subjected to high interest rates and several other unnecessary conditions. So it's very important that you repair your credit if you have bad credit. You will get lots of tips on how to do this easily in this book.
Your credits score - how you can improve it.
Your credit score is a very important in any financial transaction that you make or intend making in future. So it's good you know what exactly your score is, understand its meaning and learn how you can improve it if it's not good enough.
"Many factors can contribute to a negative rating from the credit reporting agencies. Many factors like are non-payment of an account or late payments over an extended length of time, can contribute to someone getting a "bad credit" rating or poor score. Whether non-payment of an account is willful or due to financial hardship, the result can be the same, a negative rating. ... But there is hope to get credit cards for people with bad credit, poor credit or lower credit score"
Credit report - its effect on your personal credit
Credit report is a compilation of your credit history, past financial transactions and personal information possible. This report is usually compiled by accredited agencies known as credit reporting agency.
Credit reporting agencies are organizations that help credit card companies, loan companies, banks, and departmental stores in the country to ascertain the credit worthiness of their would be clients.
Once they have detail information from these sources, they give it to any organizations in need of it when requested. Though they keep on file information concerning you and your credit, they don't make final judgments as to your credit worthiness. The decision is up to the credit card companies or any lender which you are dealing with.
Credit cards: - types and what you need to know about them.
Nowadays, everybody wants to have at least a credit card. Everywhere you go you see adverts from various banks and other financial institution offering you credit card. However, before you apply for a credit card, there are several factors you need to consider. So it's very important that you know more about the types of cards available, and one that will work best for you.
Secured credit card: - A secured credit cards for people with bad credit requires a security deposit as collateral before you can get approval. Its type of card that best suit the need of people with no or poor credit who are trying to build their credit history. Your collateral must be equal or greater in value of the credit amount you are applying for.
With a secured card you put up your own money (into a savings account with the bank you are applying for credit card) and that amount (or part of it) is the credit line for your card. Put in $500 and you could have up to a $500 credit line. You can deposit anywhere from two hundred to two thousand dollars into an account, and that will be your spending limit.
This will give you the flexibility of using a credit card and because if you pay off every statement you are letting creditors know that you can handle credit (again) and your bank may soon begin extending your credit line beyond what you have put in. So you are on your way back to healthier credit, to a status where you will no longer need a secured card.
Business credit cards: - These are the card that's available for business owners, directors and business executives. They come with several features just like any traditional credit cards. You have to consider the terms and condition for these types of cards too before applying.
Student credit cards are another type of credit card specifically for students. These types of cards are made for students because of their lack of credit history, and if given chance they can build their credit history with such card.
Prepaid credit cards: - are set of cards that are just acceptable wherever the traditional credit cards are acceptable, but they are not credit card. You will have to always transfer money to your card before you can make use of the card and you may not be able to spend more than you prepaid for the card.
Presently this is almost the best card for people that want to avoid interest and other fees charged on traditional credit card and also for people with bad credit. However, other little charges like monthly fees, application; over the limit and ATM fees are still applicable, but these gets offset if you pay your bills via money order
Whichever card you decide to choose make sure that you go over the terms applicable very well to avoid putting yourself in financial bondage. In second part of this article we will continue looking at other types of credit card.
Balance credit cards are unsecured standard cards designed to allow consumers to save money in interest charges by transferring higher interest credit card balance onto a lower interest rate credit card.
Low interest credit cards are other types of non secured standard credit card. They offer either low introductory APR that change to a higher rate after a certain period of time or a low fixed rate. You can take advantage of the low introductory APRs to make larger purchases for now and pay them off several months later. It wont be possible to get this credit card for people with bad credit
Air Mile Credit cards are cards that are good for people that travel frequently or planning to go on vacation. It's a form of reward card that allow you opportunity of obtaining a free airline ticket. You will need to accumulate specified air miles before you can be entitled to free ticket. All accumulated mile points will be based on dollar amount of your credit card purchases over a period of time based on predetermined point level.
Specialty credit cards are other set of standard non-secure cards designed specifically for individual business users and students with unique and special needs.
Make sure that you study the terms of any of the card that you pick very well to avoid risking your credit rating. Also, when you pick any of the reward cards make sure you study the forms and offers very well because credit card issuing companies do offer different reward programs and their promotional offers often change. So make sure you thoroughly look over the card's terms and conditions of each specific card before applying.
What you should know before applying for Bad Credit Credit Cards brought to you by [http://www.a-free-guide-to-bad-credit.com], detail articles for bad credit credit cards, loans and debt consolidation.
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The Basic Credit Card Types
By Richard Gilliland
It may seem incredible, but credit card issuers clog the mails with over 2.5 billion offers inviting people to apply for a credit card. Even those who would not qualify for a conventional credit card due to serious credit problems are now able to get one; some credit card issuers even specialize in this particular type of market. And according to financial gurus, there are at least a billion credit cards in active circulation throughout the United States alone.
Credit has been an economic cornerstone for some time now. Surveys show that the average American household is estimated to have at least twelve credit cards, including charge cards. While you may tend to think that one credit card is pretty much the same as the next, there are in actual fact distinct characteristics for each different credit card type. It is good to know these difference between the three different types of cards in the market: a bank credit card, a travel credit card, an entertainment credit card (although nowadays the combined travel and entertainment card has become more common) and a retail credit card or house card.
Bank Credit Cards
You have probably noticed that most credit cards bear either the logo of Visa or MasterCard together with the name of the bank. It would appear that the credit card has been issued by either Visa or MasterCard. That is not quite an accurate assumption: these two companies do not issue credit cards directly to the consumers. Most of the credit cards on the market today are offered by thousands of banks around the globe. Each bank is linked to the credit card association, because are not allowed to issue any kind of card unless they are association members.
Visa is a privately held membership association, although it is preparing to go public. It started as an association of banks in California and the West Coast. There are over 20,000 financial institutions in the membership rolls, and virtually all of them offer Visa Card. MasterCard is also a membership association, similar to Visa, and originally consisted of member banks in the East.
A bank credit card is in reality a revolving credit line. When you receive your statement, you can pay all or part of your balance each month, run up the balance again and so on. Being a credit line, the account comes with a pre-determined credit limit that depends on key factors like disposable income, credit history, etc. The credit limit can be as low as a $100 or as high as many thousands of dollars.
It is possible for card holders to get themselves into trouble when they do not properly manage the revolving credit line. When you carry a balance instead of paying it off, the credit card issuer starts charging interest on that balance -- in some cases, this interest could be pretty steep. The interest rate varies widely, depending on who issued the card, but you could expect the average credit card interest rate to be at about 18 percent.
For instance, if you carry forward a $1,000 balance for 12 months, you pay $180 in interest per year or $15 every month. If you maintain a $1,000 savings account, you will earn about $40 in interest per year. Those who get into trouble will have to reduce debt, and one of the more common ways to go about this, is to arrange for credit card debt consolidation, which helps lighten the interest burden.
Travel and Entertainment Card
Travel and entertainment cards are similar to bank credit cards in the sense that holders can charge purchases at various stores and locations. However, they are also different from bank credit cards because they are offered directly by the credit card companies, namely, American Express and Diners Club.
This credit card type was once accepted primarily at travel- and entertainment-related businesses such as airlines, hotels, restaurants and car rentals. Nowadays, all other establishments, such as upscale department stores, gas stations and drugstores, accept them. Like any bank card, the typical travel and entertainment card of today offers the menu of features that most credit card holders have come to expect, such as frequent flyer miles, luggage insurance and collision insurance coverage on rented cars.
A further difference between travel and entertainment cards, and bank cards, is that travel entertainment cards do not carry an extended line of credit. This means that you will are required to pay your outstanding balances in full, either within one or two billing periods, in order to for the account to stay current.
Both travel and entertainment credit card providers, such as American Express and Diners Club, also deliver categorized summaries of expenses charged to the credit cards at the end of each year. This certainly is a convenience at tax time.
House Card
Unlike a bank credit card, and a travel and entertainment card, which you can use in many purchase locations, a house card is accepted only at a particular store or stores within the same chain. House cards (also referred to as retail charge cards) are the second largest category of credit cards; major house issuers include department stores, oil and gasoline companies, and telephone companies. Discover Card, once owned by Sears, was probably the biggest house card until it was purchased by a financial institution to become a distinct credit card company.
Merchants are very much in favor of house cards as these cards are valuable in helping them to both develop customer loyalty and enhance sales; you may appreciate the shopping convenience they give you. Just like bank credit cards, house cards give you a line of credit, with a limit that varies depending on your creditworthiness. For this reason, you may choose not to pay your credit card bill in full each month. Note, however, that the majority of house cards charge fixed interest rates of between 18 and 22 percent annually; thus a house card is more expensive in terms of interest cost than a bank credit card.
All types of credit cards involve costs when you use them. After knowing the different credit card types, you may choose the credit card that best fits your personality and needs. If you have a number of credit cards on your wallet, you may also consider discarding some.
If you are the type who does not carry a monthly balance, you can have a credit card with no annual fee but make sure that there is a grace period on purchases. However, if you do carry a balance, it is wise to do away with a credit card that has the worst of the following:
· High interest rates
· Unfavorable interest calculations. A credit card may calculate interest charges based on average daily balance, not on the balance due.
· No grace period. Some credit cards might charge interest from the date of purchase until payment date, even if you pay off your balance.
· Nuisance fees. Try to do away with credit cards that have late-payment fees, over-limit fees, fees for not carrying a balance or only a balance below a certain level, or a percentage fee on your credit limit.
The modern bank credit card was first introduced in the 1960s by the Bank of America; the travel and entertainment credit cards were both introduced in the 1950s. Much may changed since then in terms of features and benefits, but the basic characteristics of each type of credit card have remained the same.
Richard Gilliland Provides Expert opinions and reviews to help you apply and choose the right credit cards [http://www.credit-wisdom.com].
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Rebuild & Keep Good Credit Ratings by Understanding Your Credit Cards
By David Hall
Secured Credit Card is similar to a prepaid credit card since the funds you are using are actually yours and not the issuer of the credit card. Generally people who apply for secured credit card or prepaid credit card are people with poor credit or unemployed. Prepaid Credit Card spending limit is the amount of money you loaded to the card. There are no interest or finance charges on a prepaid card. With secured credit card, your credit line could be from 50% to 100% of your deposit depending on the institution giving you the secured credit. Therefore the company giving you the secured credit card has zero risk.
Secured credit card can be very beneficial because it gives you an opportunity to rebuild your credit history and you are able to make purchases just as if you had an unsecured credit card. Many companies require that you have a credit card to make purchases, such as car rental, airline tickets, etc. Ensure that the company issuing the secured credit, routinely reports customers' payment history to any of the three main credit bureaus namely Experian, Equifax and Trans Union. This reporting to the credit bureaus will rebuild your credit history over time.
Closing unnecessary accounts and consolidating your bills to make payments more manageable could be an advantage financially. By not applying for too much credit within a short period of time is another factor that will help in rebuilding your credit rating. Additionally, even though secured credit is like prepaid cards, they do have certain fees attached.
Benefits are similar to that of an unsecured credit card, such as usually being paid interest on your balance in the bank, using Automated Teller Machines (ATM) to make deposits, withdrawals, and making purchases at participating merchants. Following the above steps will strengthen your credit rating.
Unsecured Credit Cards are issued to individuals with good to excellent credit rating. Credit ratings depend on certain criteria, such as one's ability to repay loans. These criteria include payment history, employment history, and financial stability. Individuals with excellent credit will most likely receive a lower interest rate. A major factor in maintaining excellent credit is making your loan payments on time thus avoiding late fee penalties.
Customers should read the credit agreement to ensure that they understand their obligation to the creditor. Making payments on time will strengthen your credit rating. Unsecured credit cards has numerous advantages such as low interest rates, high credit limit, business name options, no annual fees, and low APRs on balance transfers up to 12 months. Closing unnecessary accounts and consolidating your bills to make payments more manageable could be an advantage financially. By not applying for too much credit within a short period of time is another factor that will help in maintaining a good credit rating.
Rebuilding your credit takes time, patience, and consistency. If you consistently pay your bills on time, you will see an improvement in your credit ratings over time. There are no quick fixes for improving your credit report except for mistakes or inaccuracies that can be corrected, hopefully in your favor. Your credit information is maintained by the credit bureaus namely Experience, Equifax, and Trans Union for seven years. Therefore poor credit information will remain on your report for seven years. The good thing is that as negative information disappears with positive information, this will definitely rebuild your credit rating.
Applying for secured credit card can be very beneficial because it gives you an opportunity to rebuild your credit history, and you are able to make purchases just as if you had an unsecured credit card. Many companies require that you have a credit card to make purchases, such as car rental, airline tickets, etc. Ensure that the company issuing the secured credit, routinely reports customers' payment history to any of the three main credit bureaus namely Experience, Equifax and Trans Union. This reporting to the credit bureaus will rebuild your credit history over time.
Business Credit Card
Business credit cards are very popular for small business owners because of the many benefits they offer. Benefits includes 0% Intro APR on balance transfers, no annual fees, high credit limit, low interest rates, cash rewards, bonus miles, free online account management to choosing card design etc., At iCreditOnline.com we have some of the best business credit cards from American Express, Advantage, Chase, Bank One, Bank of America, Discover, Citibank, Household Bank and more, with online credit card approval. Why waste time going to a bank when you can get a decision in less than 60 seconds with secure online credit card application. Online Credit Card Approval with Online Credit Card Application is fast and easy!
Student Credit Card
Having a student credit card while still living at home or attending school away from home can be an advantage. It gives the student the opportunity to establish credit at an early age and to start asserting their independence. It comes in handy in case of emergency, it is less trouble and safer to carry a student credit card than to carry cash. Parents find student credit cards to be very convenient. They are able to make deposits to their children's account while they are away from home. Students should be careful with their credit card receipts to avoid identity thief.
If you consistently pay your bills on time, obtaining students credit cards is a good way to established credit rating and start building a good credit history while in school. Establishing and maintaining a good credit rating will make it easy to purchase a car, a home or obtaining a personal loan in the future. For students who are not committed to their financial obligation, getting a student credit card is not a good idea. Running up balances, finding yourself in debt, unable to make monthly payments will destroy your credit rating.
Student's credit cards generally have high interest rates. At iCreditOnline.com we offer some of the best student credit cards from Chase and Discover with 0% APR introductory rate for 6 months, no annual fees and online account access. Online credit card approval with online credit card application is fast and easy!
Explanation of some of the credit cards we offer:
0% Intro APR Credit Card or Balance Transfer Credit Card gives you the benefit of using this credit card without making any interest payment on the principal for a stated period of time. This credit card is marketed to individuals with good credit rating who want to transfer balance from a high interest credit card to a 0% intro APR credit card.
Cash Rewards or Cash Back Credit Card earns a percentage on purchases made. This reward or cash back is credited to your account.
Debit Card takes the place of carrying a checkbook or cash. This card is used like a credit card with certain limitations, such as not being able to rent a car. Purchase transactions are contingent upon having enough funds in your checking or savings account to cover the purchase. Verification of funds requires entering your Personal Identification Number (PIN) at a point-of-sale terminal.
Low interest credit card saves you money. Having a good credit rating qualifies you for some of the best low APR credit card offers.
Prepaid Credit Card spending limit is the amount of money you loaded to the card. There are no interest or finance charges on a prepaid card. Therefore the company giving you the prepaid credit card has zero risk. Generally people who apply for prepaid credit card are people with poor credit or unemployed.
Secured Credit Card is secured by the amount of funds you have in your account. Your credit line could be from 50% to 100% of your deposit depending on the institution giving you the secured credit.
Unsecured Credit Card is issued to individuals with good to excellent credit rating. Credit ratings depend on certain criteria, such as one's ability to repay loans. These criteria include payment history, employment history, and financial stability. Individuals with excellent credit will most likely receive a lower interest rate and can receive instant online credit card approval. A major factor in maintaining excellent credit is making your loan payments on time thus avoiding late fee penalties.
Travel Rewards Credit Card benefits may include travel accident insurance, free rental car collision/loss damage insurance, rebate on gasoline purchases, frequent flyer points or bonus miles towards airline flights, free quarterly and annual account summaries.
David Hall owns [http://www.iCreditOnline.com]. He offers free downloadable, high quality guides on credit repair, credit ratings, credit scoring, debt consolidation and more. He has tools for finding a wide range of financial services including secured and unsecured cards, student and business cards, auto loans, and more from the most reputable companies in the industry. You can also compare multiple credit card offers, securely complete an online credit card application, and receive a credit decision in at least 60 seconds. Visit David's site today: [http://www.iCreditOnline.com]
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Shopping For A First Credit Card
By Timothy Meyer
Long before we are old enough to carry credit cards ourselves, advertisers make sure we know about the power of plastic: "It's everywhere you want to be." "It pays to Discover." "What's in your wallet?"
While using an ad campaign to choose a card is a terrible idea, the slogans have one thing right: A credit card can be a powerful thing. For teens and 20-somethings looking to pick a first card, taking the time to choose carefully can save money and offer a boost in establishing and building a credit history.
An excellent credit score will be helpful when you start to think about buying a car or getting a mortgage. Even if you do not plan to take out a large loan in the near future, your credit information can be a factor in renting an apartment, obtaining a membership at a club or getting hired for certain jobs.
Lenders use credit reports to determine how risky it is to give a borrower - that is, you - a loan. All in all, the lender just wants to know if the borrower will be able to pay back the loan. If the borrower has bad credit, then he or she probably made some major or ongoing financial mistakes and is more likely not to repay. On the other hand, if the borrower has good credit, then he or she has a history of paying back debt, and the lender will most likely grant the loan.
Credit cards are effectively short-term loans that need to be paid back within a short grace period. Getting the first credit card can be tricky. Credit card companies do not have any basis for your credit history since you have not borrowed any money in the past. So how are you supposed to establish and build your credit rating without a history?
One way is to apply for a secured credit card. Secured credit cards are backed by a deposit that you make upfront. Usually, the amount you deposit will be the same as the card's credit limit. Everything else is like a regular unsecured credit card: You use the card to buy things; you make monthly payments; and you incur interest if you fail to pay off the full balance. A secured credit card should be only a temporary step to building credit. Try to pay off the total balance every month to show that you are financially responsible. After all, not only do you want to build a credit history, you want to build a good one.
Another effective way to start your credit history is to become an authorized user on someone else's card. Many parents will designate their children as authorized users on their credit cards so that the children can build credit without the legal obligation to pay the balance every month. However, if the person whose account you are authorized to use does not handle the account properly, their mistakes could end up hurting rather than helping your credit.
Once you establish your credit history, you can shop for your first unsecured credit card. You will quickly discover that there are many to choose from. A number of factors can help narrow the search.
The most important of these is how you intend to use the card. Are you going to use it only for emergencies? If not, will you pay in full each month, or will you carry a balance on the card? Once you decide how you will use the card, follow your self-imposed rules. It is very easy, and dangerous, to continually swipe the card and tell yourself it is for a good reason. But it is crucial to be stubborn about establishing good spending habits, even - or maybe especially - early in life.
If you plan to carry a balance on your card, you must be aware of the interest rate of each card you are considering. The interest rate used by credit card companies is the annual percentage rate, or APR. There are cards with variable APRs, which are based on a certain index (such as the U.S. prime rate). There are also nonvariable APRs, which are usually fixed-rate credit cards. As a beginner, you will usually want a low-rate, nonvariable APR credit card, because knowing your interest rate will give you a sense of how much money you will need each month to pay at least the minimum amount due. A low-rate, nonvariable APR card will therefore help when you create a monthly budget.
In addition to interest rates, pay attention to penalties and fees. Reading the fine print in a contract can save you from owing avoidable charges. The most common fees include balance transfer fees, cash advance fees, fees for requesting a credit limit increase and online or mobile payment fees. Many cards also impose penalties for not paying your bill on time or going over your credit limit. You should hold out for a card with minimal fees and reasonable penalties. Even if other features of a particular card seem attractive, avoid the potential for exorbitant fees and penalties that could hurt your cash flow and your credit history.
Understanding your spending habits will help you determine which incentives will be important to you. Most cards offer rewards programs to their customers or offer cash back for certain purchases. Many cards offer 0 percent APR for the first six to 18 months that your credit card is open. These cards are great if you plan to carry a balance from month to month. Some cards even offer anywhere from 1 to 5 percent cash back on all or certain types of purchases. If you know how you plan to use your card, then certain cards' rewards programs can save you a lot of money.
As a first-time cardholder, once you have chosen the card that is right for you, you may find it exciting to be able to swipe the piece of plastic and not have to pay in cash. But while credit cards can be useful tools, it is important to not fall into the black hole of credit card debt, which can be all too easy for an inexperienced user. Make sure to know how your credit score works and how to avoid penalties so that you will be able to make larger purchases and secure loans in the future.
Your payment history, the amount of credit you use and the number of negative marks on your credit history have the highest impact on your overall credit score. If you can, pay off your total balance on time each month, ensuring that you have a 100 percent payment history. Paying off your card every month comes with the added bonus of saving you from being charged any interest on a carried balance.
You will also want to use as low a percentage of your credit limit as you can. This ratio is called credit card utilization, and most experts recommend that you try not to go over 30 percent at any time. Credit card companies want to know that you are responsible with your spending and that you will be able to pay off your balance each month. You can either spend less each month or increase the credit limit on your card to lower the percentage used. You can also pay more than once per month.
Obviously, you should avoid any negative marks on your credit history. These can include collection accounts, bankruptcies, foreclosures, civil judgments or tax liens. Although someone applying for a first credit card typically will not have had time to worry about bankruptcies or foreclosures, keep in mind that such problems can severely damage your ability to secure credit in the future.
As a first-time applicant, you may find that the length of your credit history, the total number of accounts open or closed in your name and the number of credit inquiries also have an adverse rating on your credit score. Your credit history will be short. You will not have many open or closed accounts. Your first credit inquiry will most likely be from the company where you applied for your first credit card. Be patient. Building a credit history takes time, but as a young adult, staying on top of your finances, and especially your credit cards, will help you in the long run.
Credit cards can be both powerful and dangerous, but they are also a convenient part of everyday life for most of us. A first credit card offers a great opportunity to establish positive financial habits that will serve you well for a lifetime.
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Some Good Info On Credit Cards: What One Is Best For You?
By Brix Wayne
These represent the guidelines I use when picking a card. Despite the fact that there are various ways to handle it, I feel these guidelines have, and are going to continue, to guide me in the right direction.
It's important to go out and look for it. How many great things have just arrived on your front patio? For me that would be none. I can think of absolutely nothing worth while which I haven't been required to go out and get on my own. And it is no different in the matter of credit card offers.
Often the card offers that come in the mail are just that; things that land on your front patio. Not to imply these kinds of card offers are lousy and that they should not be checked out. Merely know that these kinds of "You've Been Pre-Approved" mailings are often more of an ad. The card providers obtain records from the credit bureaus and, in case you satisfy their standards, use that to deliver you their offers.
Where can you look in order to find the deals? Internet sites are a fantastic place to start. You'll find several these days that are up-to-date with the most recent card offers. An alternative place to check would include the credit union. If you've got a great partnership with your local bank, have always paid your bills on time, and have a great credit rating, you can probably get a great interest rate with them. Even though, they might not supply the perks the other major providers do.
It is wise to explore the fine print of the card you're going to be registering for. Card providers pay a considerable amount of essential professionals serious money to guarantee that they're taken care of for any plausible problem with regards to their terms and conditions. And by getting, and taking advantage of the credit card, you agree with all of those terms and conditions. Know whatever it is you sign on for as the excuse of "Well I didn't understand that!" probably won't keep you from trouble.
Analyze These Components When Picking Credit Cards:
The Shumer Box
The Schumer Box was born in Nineteen Eighty-Nine and was the invention of then NY Congressman, Charles Schumer. The Schumer Box sums up the costs of the card. The Schumer Box is made up of the following:
Annual Fee - An annual service fee which the credit card issuer tacks straight to the card balance.
Annual Percentage Rate (APR) - The rate you are going to be charged interest at. This may include 2 APRs, the promotional as well as the long-term.
Variable Rate Details - If this applies to the card, it will clarify when the credit cards APR(s) will change.
Various APRs - When it applies, such as for Non-payments, Cash Advances and Balance Transfers.
Grace Period - The amount of time given after the payment is owed before you start getting charged with penalties or fees.
Financial Calculation Method - This relates to your credit card not being settled, entirely, immediately after every cycle.
Transaction Fees - Fees associated with particular transactions that include Cash Advances, Missed Payments, Balance Transfers, and Going Beyond The Borrowing Limit.
Finance Charges - Should you carry a balance over to the next billing cycle, this is the minimum amount the business will charge.
Additional Details
Because of the Credit Card Accountability Responsibility and Disclosure Act (Credit CARD Act) of 2009, there are numerous improvements that have helped the credit card holder. A few of the details of the CARD Act are:
Advanced Notices - The issuer of your card needs to warn you of any major alteration to your account and / or any sort of rate increase forty five days prior to taking effect. The notification is supposed to be clear to give you the opportunity to cancel the account. The nice thing is the fact that, should you choose to shut down the credit account, the credit card supplier is unable to penalize you for doing it. In spite of this, they are able to require repayment in full within 5 years or increase your minimum payment two fold.
Retroactive Rate Increases and Universal Default - Other than as specified, your card company is unable to increase your finance charges, fees, or percentage rate (Annual Percentage Rate) on outstanding balances. This won't include things like a special introductory rate, such as with interest free credit cards, which is clearly described, or on variable interest rate cards. Furthermore, this isn't going to apply for anybody who is 60 days late on making a payment. Even so, the credit card company will need to provide you with an opportunity to earn back the prior rate following six months.
Returning Your Rate Of Interest - In the event your credit card company increased your interest rate for a certain reason, they have got to lower your rate when that reason happens to be corrected. If your interest rate increased because your credit score went down, then the card issuer must reverse the rate when your credit score goes back up.
Double-Cycle or Two-Cycle Billing Has Been Banned
Above The Limit Charges or Fees - Above the limit charges that happen because of various fees or interest charges aren't allowed. In addition, the credit card provider cannot charge for going above your limit until you have opted in permitting expenditures that would send you over your credit limit. If you haven't opted in to this and an expenditure is authorized to become processed, which puts you over the limit, the card issuer cannot charge you. Finally, if you're charged an above the limit fee, the card company is only allowed to impose one above the limit fee each month (not each purchase). Assuming your balance stays over your credit limit over many billing cycles, only 3 over the limit charges may be charged.
There are several additional parts to the Credit CARD Act. Those are just some I thought should be brought to your attention.
What Card is Right For You?
If you do not travel by plane then for what reason would you possess a card with Frequent Flyer Miles? Does your work or personal business keep you on the road everyday? Assuming you are using a credit card to cover gas purchases, it makes much more sense to use a credit card which delivers money back or maybe some kind of fuel incentive. Taking the time to obtain the credit card that fits how you live not only makes sense, it might also benefit you to use them.
Reward Points - With these types of cards, you earn a particular amount of points for certain transactions. For example, you might get 2 points for every single dollar spent at restaurants or specific merchants, as well as one point for every single dollar you may spend on all other transactions. These points can then be used on items like flights, motels, gift cards, merchandise or money back.
Cash Back - These credit cards commonly offer one percent cash back for all expenditures. Some offer special percentage rates like 5% cash back for products from specific establishments. The particular retailers often switch each month and you will probably have a limit for the amount you can earn for the month or year. Some may provide a set percentage for things like gas and food.
Airline or Flyer Miles - These credit cards are generally similar to Reward Points credit cards. You generate a designated quantity of miles for each dollar spent. Quite a few allow you to use your air travel miles for hotel accommodations, car rentals plus more.
Fuel Cards - These types of credit cards are usually similar to Cash Back cards. You receive a specific percentage of each dollar paid in money back and greater cash back percentages on products from certain retailers or categories.
Conclusion
Irregardless of what credit card you select, there is one element which is the most critical to remember. You must pay off your card balance every month. When the balance isn't settled in full, when it is due, then you'll lose more then you may ever generate through the perks these cards offer. And isn't that the point of choosing an amazing card with awesome rewards?
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The Credit Card - A Most Valuable Tool For Building Credit
By Jason R Tinsley
A credit card is a small plastic card issued to the consumer by a financial institution such as a bank or credit union. The card issuer creates a revolving account with a line of credit to the consumer. The cardholders can purchase goods and services or receive a cash advance, until they have reached their predetermined credit limit. The merchant who accepts credit card payments receives the money from the bank issuing the card. The cardholder eventually repays the bank through regular monthly payments. If the entire balance is not paid in full, the issuer usually charges interest on the unpaid portion.
Credit cards can be an extremely valuable tool if used correctly. However, there are also risks for those who lack self-discipline for the debt they cannot repay. Although when used responsibly and with the correct intentions, the card can provide significant benefits. Here are some of the attributes of owning a credit card:
Convenience
The credit card is a flexible payment tool accepted at over 30 million locations worldwide as it has become a good alternative for cash. On many occasions, situations arise where you need more funds than what are immediately available. Emergencies such as home or car repairs, medical expenses, travel for a family crisis, are attainable instantly with a card. Such credit spending should be done with a short-term intention with timely payments to avoid accumulating debt.
Establish and Boost Credit History
Paying your bills in full and on time indicates responsibility which helps to boost credit rating. A good credit rating also helps in many other situations, such as, obtaining a loan with a low-interest rate. More than likely, your card company will also approve a higher credit limit.
Borrowing Interest Free
Credit cards allow you to use the bank's money interest free within a grace period. Therefore, payment for purchases on the card are due at the end of the pre-determined period. Paying your balance in full each month enables you to receive an interest-free loan month after month.
In order to entice new customers, card issuers frequently create 0% interest rate promotional offers for credit card purchases and cash advances. The only limitation is for the credit loan to be fully paid back at the end of set time period. If used wisely, one can use the credit card 0% interest loan to pay off higher interest rate debt. As long as you have the self-discipline in controlling spending, this type of financing can be a valuable tool for money management and budgeting.
Tracking Spending
As the credit card issuers provide detailed monthly statements on purchases, they allow you to keep track of your spending with ease. For business owners, the summaries are a valuable tool for tax return preparation, as they provide information for allowable tax deductions.
Rewards and Benefits Many companies offer rewards and cardholder benefits to their customers. Loyalty programs have been designed to encourage cardholders to use one specific card. As the card is used, the cardholder accumulates airline miles, hotel chain points, cash back points etc. that a cardholder can redeem for products or services. For those who use their cards frequently, the rewards can be quite substantial.
In addition to loyalty program rewards, cardholders also reap benefits that include complimentary car rental insurance, travel insurance or overseas health insurance.
Consumer Protection
For mail-order purchases that are not received, or turned out to be defective, the charge can be disputed with the credit card company. The burden of proof lies with the sender; therefore, the consumer has limited financial liability. Such consumer protection provided by the credit card company is not available with most debit cards or when paying cash.
Protection from Fraud
Carrying cash can be unsafe, as it can be stolen or lost. The lost cash is rarely replaceable. Instead, a misplaced or stolen credit card can simply be inactivated by the card issuer and a new one reissued. As for any fraudulent charges, they can be challenged. Upon investigation, the charges are usually forgiven or refunded.
Responsibilities of the Credit Card Holder
A Cardholder can maximize their benefits by,
- Paying on Time - On time payment is the best way to avoid late fees and penalty interest, and at the same time, boost credit score. The simplest way to ensure on time payments is to set up an automatic bill pay system.
- Paying More than the Minimum Due - If balance can not be paid in full, it is vital to pay as much as possible over the minimum.
- Not Using Your Credit Cards' Upper Spending Limit - Having the maximum amount charged can lead to recurring fees and interest expenses. Maxing out the credit card also leads to a The rule of thumb is to keep the card balance below 30% of the limit. By spreading purchases between several credit cards, you can manage the 30% limit with minimum difficulty.
- Avoiding Unnecessary Fees - Many credit cards charge various fees: late payments, over-limit, cash advances, transferring balance or returning check. Read through your credit card agreement to be fully aware of all the fees. Avoid these transactions as much as possible.
Change of Terms and Conditions
Credit card companies frequently change the terms and conditions. Such changes often include fee structure, interest rates, billing, and other features. More often than not and to your detriment, these modifications benefit the card issuer. Be aware of these changes as it can help you utilize the card more efficiently. For example, a cash advance fee increase could prompt you to use a different card for cash advances.
As described, owning a credit card can be very advantageous. However, if not handled properly, it can become a liability, such as
- For non-timely payments, a credit card loan carries a higher interest cost than other forms of credit
- It can create poor credit scores due to late payments
- It allows you to have a false sense of security thus accumulating more debt than manageable
- It complicates your living with complex terms and conditions
It is critical to always use your credit responsibly. Credit problems such as extending credit limits to the maximum can result in a poor credit scores.
Jason Tinsley is a writer and contributor for [http://www.RepairYourCredit.com] and passionate when finding ways to build or repair credit. You can find more information on Building Credit With Credit Cards and improving your credit score by visiting www.RepairYourCredit.com [http://www.RepairYourCredit.com]
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Apply For A Credit Card Online - The Ultimate Guide
By Trevor Taylor
Credit card use in the U.S. is growing rapidly with just over 14% of Americans holding more than 10 cards. Take on board the fact that the average American holds four credit cards and it becomes patently obvious that credit cards now play a major role in our day-to-day lives. You may ask why is it that people need so many cards? Well the truth of the matter is that your typical businessman may have different cards to manage different areas of his business. For example, he may have a card for gas for his car. He may also have a card for hotels and accommodation, his flights too may be charged to another card and so on. But there are many Americans who have more than one card simply because none of the cards in their wallet work for them as they should..
One of the most common reasons for this is that he/she did not take the time and effort to research. Before you set out to apply for a credit card online, it is crucial that you research the market in order to find the perfect card to meet your personal requirements. Also, unless you have near perfect credit history, you should take the time to find out your current credit score as this could affect your choice of card. There are four simple rules to follow before you apply for a credit card online, which if implemented, will ensure that you end up with a card that will be tailored to your needs.
Credit Score.
If you have a good credit score or a poor credit history, you will know it! If your credit is good, and you have no reason to doubt that, then you can move on to the next part of the process. If your credit is poor then you have two choices. Before you apply for a credit card online you should set out a plan to repair your credit in the shortest time possible. This can involve either taking whatever credit card you can, even if the APR is high or you are requested by the card issuers to pay a deposit, or if your credit is dreadful, apply for a debit card (pre-paid). Either of these choices will give you the opportunity to demonstrate that you are able to manage your card proficiently, which will increase your credit score dramatically. Those individuals who are unsure of their credit score I would suggest you find out exactly what it is before you carry out any serious research (This information is available online). Different agencies use varying techniques to determine your credit score, but generally speaking underwriters suggest that a FICO score above 620 is good while results below 620 should result in further inquiry from the lender.
Research The Market.
Research is the most important part of the whole process when you apply for a credit card online. Yes, it can be tedious, but if you use due diligence here you will end up with a credit card that works for you and not the other way around. This will save you from having to apply for a further card six months down the line. Many online credit card websites are currently offering comparison charts, and while this is an easy process, it wont necessarily return accurate results. Browse for websites that describe the different cards available and the advantages of each card. For example, Rewards Cards, Low Interest Cards, Low Introductory Rate Cards, No Annual or Monthly Fees Cards, etc. The list goes on. Take all the information you learn to help you determine how much the card will cost you each month. Budget carefully and be sure you do not over-commit yourself financially. Read the small print on each offer. You will need to know about late payment charges, cash-backs and zero liability in the case of unauthorized purchases. Be wary of offers that include a low or zero % initial interest rate. You need to know when the rate will revert back to normal and exactly what that rate will be.
Your Application.
It's all downhill from here. When you apply for a credit card online you will automatically be in a secure area, and you are safe to send personal information which will go directly to the issuers office. If you want to be sure, just check that the URL in the address bar at the top of your webpage begins 'https://'. The 's' stands for secure. You will also see a gold padlock image on the right hand side of the address bar. Complete the application form as accurately as possible as approval may be delayed or even rejected through lack of information. Once you have answered all the questions on the form simply click to submit your application. Although credit cards typically take 7-10 days to arrive, you should know if you have been approved within a day or so, sometimes just hours.
Approved Or Rejected?
If you apply for a credit card online and are rejected, it will more than likely be because of a poor credit rating. It is unwise to apply again as each application is noted in your credit rating information. Your best move in this event is to spend six months or so in repairing your credit before you re-apply. If your application is approved, your card will arrive in about a week. Use it sensibly and if possible pay off the balance each month. I recommend that you only use it for purchases that you could pay for by cash. It then becomes a very convenient piece of plastic that will help you to budget and manage your finances with greater control. This action will also keep your credit score high, and you will benefit in the future by being offered the best rates available. The card issuers will also be keen to raise your limits as you demonstrate you are in total control of your finances.
So that's it! Four simple rules to ensure that when you apply for a credit card online, you will not only have a greater chance of being approved, but you will not need to be applying for further cards in the near future, simply because the card you have doesn't work for you.
Trevor Taylor
Trevor Taylor writes of his experiences in helping others to apply for a credit card online [http://www.apply-online-4a-credit-card.com/apply-for-a-credit-card-online.html]. Please feel free to visit our website at [http://www.apply-online-4a-credit-card.com/] and discover the full facts about all credit cards available.
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