Applying for the First Credit Card You See
You may see a commercial for a credit card that sounds like a great deal. Or, you may receive a pre-approved offer in the mail and the card sounds just too good to be true. Before you put in the application, consider that this card may not be the best deal out there. There are dozens of credit cards on the market so you should never apply for a card – no matter how attractive it seems – without looking at your other options. You can always come back and apply for that card if you don’t find anything better.
Not Shopping Around
Since there are so many choices for credit cards, you have to look at a few others before making a final decision. If you know how to use a search engine, you can easily find and compare various credit cards. You may, for example, compare all credit card from a certain credit card issuer. You can compare cards based on the interest rate or rewards. The key is to be sure you look at the terms and benefits of multiple credit cards before making a final decision.
Not Reading the Credit Card Terms
Credit card issuers are required to display the cost information on every credit card offer. Don’t rely only on the name of the credit card or the initial advertisement to give you all the information you need about that credit card. Click through to find out the interest rate and fees on the card so you’ll know how much the credit card will cost.
Applying for a Credit Card With Terrible Terms
Ideally, you want the lowest interest rate credit card with no annual fees and impeccable rewards. While people with bad credit typically don’t qualify for the best credit cards, that doesn’t mean you have to accept a credit card with an extremely high-interest rate or high annual fee. That’s why shopping around is important. If you’re seriously considering a credit card with worse terms than the other cards on the market, you should look elsewhere. Worst case scenario, apply for a secured credit card which will require an upfront deposit, but there are many good secured credit cards out there.
Choose a Credit Card Based Only on the Initial Benefits
Some credit cards lure customers with an introductory interest rate, signup rewards bonus, double rewards, or no annual fee in the first year. The trick is to get you hooked into the credit card with the hopes that you’ll stick around for the more expensive, less beneficial year two. Before you sign up for a credit card with great year one perk, consider what the card will cost and benefit you in the second year and beyond.
Applying for Several Credit Cards in a Short Period of Time
Credit card issuers don’t look favorably on multiple credit card applications within a few days, months even. Your first application may be approved, but your chances of getting approved go down with each subsequent application. Space out your credit card applications, not only to help your odds of being approved but also to ensure you’re taking on a large risk of credit card debt.
Assuming You’re Going to Be Approved
An excellent credit score or high income won’t guarantee that your credit card application will be approved. A high level of debt, recent delinquencies, or recent applications for credit could lead you to be denied. If you are denied, the credit card issuer will send a letter telling you the specific reasons for your denials.
