Simple Steps to Credit Card Applications

Before you rush into a credit card application online it’s a good idea to consider a few things first.

1: Find the best credit card

There are lots of credit cards out there and they all probably claim to be the best. The trick is to find the best credit card for you. The best credit card will depend on how you will use it.  If you want a card for occasional use and emergencies then you may want a card with no or low fees, if you won’t pay your bill in full each month and will incur interest then a low interest credit card could be best suited, if you pay your bills in full every month then a rewards card may bring maximum benefit and if you’re a high income earner and regular travelers then a Gold credit card or Platinum card may bring travel insurance and other useful privileges. As you can see, the best credit card for you depends on your situation.

2: Understand the credit card offer

Once you have figured out the type of credit card may be best suited to then you need to compare credit cards from the same category. Look for the following main features:

Purchase APR: This is the annual interest rate that you will pay on purchases made on the card. If you know you will be paying interest then the lower the credit card APR the better.

Balance Transfer APR: This the credit card APR charged for balances transferred from other credit cards or store cards. Offers such as zero percent for six or twelve months are common. Make sure you check costs of any transfer fees and what interest rate the balance will default to once the intro period expires.

Annual Fee: Some credit cards charge an annual fee or have a fee that is waived in the initial year or two but will kick in down the track. These things make the card more expensive to use. Some exclusive rewards cards have higher annual fees but make sure that the rewards will outweigh any costs in fees and interest.

Interest Free / Grace Days: Most cards offer a certain number of days between a purchase being made and interest kicking in. The result is that if you pay your bill in full each month then you never incur any interest charges. If a card does not have a grace period then interest will be charged from the day a purchase is made. When you open your credit card statement you may find that items you purchased have up to a months interest already owing. Stay clear of credit cards with no grace period as this could cost you hundreds in interest even if you pay your card off each month.

Rewards: Rewards come in different shapes and sizes. Try to work out the rough value of rewards per dollar spent and look to see the rewards are useful to you. You may also want to check if there are limits such as the amount of reward points or cash back you can earn in a month.

3: Have the right information ready

Applying for a credit card online is probably the quickest and easiest way to apply. It also leads to faster approval times which may be instant if the information provided is sufficient for approval and your credit score meets the criteria.

Before you apply online then make sure you have the required information to hand such as:

Personal details: You’ll need to provide personal details such as contact details including your residential address for past few years. You may need addresses for the past three to five years so if you’ve moved about then have those details ready.

Employment details: You will need to provide details of your employment status, wage and contact details for your employer. Probably best to provide an HR contact so they can verify employment and pay if required.

Identification: You may need details such as your driver’s license or social security number to hand a verification method

Balance Transfer Details: If you are doing a balance transfer then you will need details including the card number, issuer and balance of any credit cards or store cards you wish to have the balances transferred for.

Finance and Loan details: Depending on the lender they make ask for details of the other credit cards and personal loans you hold. They typical ask for issuer, balance and card limit.

Every credit card issuer asks slightly different questions but covering these basics should ensure your credit card application goes as smoothly as possible. For more information on credit card features such as credit card rewards details online.

Article on credit card application is by Richard Greenwood of finance comparison website

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