How to Get a Credit Card
Credit card is probably in top 10 most useful inventions of all times. Indeed, it makes your life a lot easier and saves you a lot of time and headache in case you have it. Getting a credit card is not as easy as they promise you in the commercials. You need to have a good credit history to get a card, and this process requires a lot of paperwork. So, if you want to get your first credit card or received several denials for your applications, feel free to check the tips below.
Check your credit scores
Most credit card companies issue credit cards to people with good credit history, high income and a checking account. If your credit score leaves much to be desired or if you lack any other requirements, you should take an extra effort. First thing you want to do is contact some credit union. They often offer credit cards that are more accessible for young people with no credit history. By the way, for those who don't know, your credit score chances are defined as follows:
- Excellent - 750-840
- Good - 660-749
- Fair - 620-659
- Bad - 340-619
Alongside with your scores, banks also pay attention to the number of credit inquiries, credit debt, and active trade accounts.
Start your credit history
If you don't have any credit history at all, apply for a small loan at your bank. Make sure you don't borrow too much. Your goal is to pay the money back in the right time to kick start your credit history and establish a good credit score. This step will help you with getting a credit line by improving your chances.
Secure credit card
You can ask a credit card company about a secure credit card which requires you to maintain a savings account equal to the amount of your credit line.
Department store or gas card
Alternatively, you can apply for a dept store or gas card to establish your credit. This is a good option in case credit card companies and banks reject your applications, but it also comes with one serious shortcoming involved: finance charges they carry may be too high. And don't forget to double check if your gas company or department store reported your payment history to the major credit bureaus.
Pay off the balance of your card every month
This is very important for your credit history and can literally mean the difference between success and failure.
Apply for a major credit card
Your credit history now looks pretty good and you have better chances. As for your old department store or gas company card, try to ditch it as soon as possible because they charge their clients with higher interest. Now, when you have a regular credit card, you don't need the old one anymore.
- Don't make late payments! This is the fatal mistake that can destroy your credit history.
- Be careful with choosing your credit card offer and don't choose exactly the level of your credit score. This is a tricky thing even if you have a good credit. Thus, if you have an excellent credit score, choose the category 1 level below to improve your chances.
- Don't send 2 or more applications at a time - it will affect your credit history. Nonetheless, you can do it if you have bad credit simply because your history is already messed up.
In today's challenging economic times, getting a credit card is really hard. Credit cards companies are really picky with the clients, and you need to be a perfect candidate to get it fast. Just be smart and follow the guidelines to become a credit card holder!
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