You can obtain a credit card if you have a decent credit score, and in some cases, even if you do not. It is true that with the current state of the economy banks have tighten up their restrictions on who can qualify for a credit card, but this does not mean you are out of luck. Prior to applying for a card, you should take some time to do your homework so that you do not fall for an advertising gimmick that may cost you in the end, and so that you are equipped to negotiate with credit card companies.
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Whether it is your first credit card you are seeking or an addition to the several you may already own, you will want to make sure you get the lowest APR possible and avoid unnecessary fees that are often charged. Following are some tips that will help make the process of applying for a new credit card easier.
First Step You Should Take Before Applying
Prior to looking into credit cards, you should take the time to get a copy of your credit report from all three major credit bureaus. By law, you are now entitled to one free report from each credit bureau per year. Carefully read over your credit report to check for any errors or information that seems out of place. You will want to write to the credit bureaus to have any inaccurate information taken care of before applying for a credit card. This way you will have the highest credit rating possible when you apply and the best chance of being approved.
Forbes Magazine online explains that credit scores must be higher than before to be considered excellent. You will need a score of at least 750 to be considered to have excellent credit. Additionally, you will need a stable income and proof of your ability to pay in order to be considered for many credit cards.
Steps to Take After Reviewing Your Credit Report
If you are planning to apply for a credit card in the near future, it is a good idea to save the credit card offers you frequently receive in the mail. Even if these are not cards you plan to apply for, these offers may come in handy when negotiating with credit card companies.
You should make use of the internet to research credit cards that are currently offering the best interest rates with few, if any, fees.
Once you begin to contact credit card companies, do not be tricked into thinking you cannot negotiate. MSN Money recommends you play hard to get with credit card companies. If they think you have better offers from other companies, they may be able to offer you a lower interest rate, reduce fees, or offer a higher limit. You will have to do some acting and stay strong. This is where it will help if you actually have located some offers that are better.
If You Don’t Have Established Credit
If your credit has been damaged by debt and missed payments or if you are just starting out and have not yet established credit, it will be important to attempt to repair or establish credit before applying for a credit card, especially one from a major credit card company such as Visa or MasterCard.
Those who need to establish credit can often open a store credit card with a low limit or a gas card. These cards are much easier to obtain than those from the major credit card companies are. Be aware. Store cards tend to have very high interest rates, but if you make sure to always pay off your balance immediately, you will not have to worry about it.
Through store credit cards, you can build credit and before you know it, you will be able to apply for a major credit card.
If you have damaged your credit, you will need to repair it before you can qualify for a credit card. While you still may be able to get a store card or gas card you may also be able to get a secured credit card to rebuild your credit score. With these cards, you put money into a credit line and the bank gives you a certain percentage of credit above this. Typically, interest rates are very high if you do not pay off your balance immediately, but by showing that you can and will pay your credit card bill regularly, you may be able to get an unsecured card in just a few months after using a secured credit card.
By taking a little time to do your research before you contact a credit card company, you will soon have a credit card in your hands. Even if you have little credit or bad credit, there are steps you can take to get a major credit card. Just remember to use it wisely and always pay your bill on time!
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