So many credit cards! Which is right for me?
Applying for the right credit card can be difficult and burdensome. With so
many credit cards out there picking the right one can be tricky because you want to be sure you will qualify.
Every time you apply for a credit card, your credit report takes a hit. So while credit cards can have their
benefits, they can also have their pitfalls. Most banks separate their credit cards into different areas to
indicate to the borrower that they should only apply for ones that fit their needs and borrower profile. When
choosing a credit card it is important to know and understand exactly where you credit stands. Do you have
problem credit history or great credit history?
Lenders have separated cards into different groups to make it easier and less
painful for you the borrower. There are so many credit cards out there. Lenders generally break credit
cards into the following areas; credit cards for excellent credit, credit cards for fair credit, credit cards
for problem credit, student credit cards, business credit cards, and pre-paid credit cards.
Now understanding the difference between excellent, fair, and problem credit cards
is fairly easy. If you have excellent credit you are better off applying for those cards because you will
benefit by enjoying a lower interest rate. Credit cards for problem credit will have higher rates and often
times annual fees associated with them. It is important to know where you stand on your credit report before
you decide to go off and apply for a bunch of cards.
Student credit cards are great for college students. These credit cards
often give additional incentives to the students to apply. These cards are often times borrower's first
credit card ever,therefore the way you use this credit card is important because this is the card that will help
you establish the most credit. Banks know that when you are a student your credit history is minimal.
They will look past this when issuing the cards. They know you will be determined not to default on any
payments, as this would affect your credit for years to come. These credit cards sometimes offer lower rates
when you are a student, this is also important for you to watch out for because when you are finished those rates
tend to jump!
Business credit cards offer perks and benefits for many small businesses.
These cards are generally used to help get a small or medium sized business to the next level. These cards
come in useful when your business is unable to get a traditional loan because the company is so
Pre-paid cards offer a way for those without credit to enjoy the benefits of
purchasing items with a card instead of cash. If you have minimal credit and cannot qualify for a standard
card then getting a prepaid card will allow you luxury to purchase items online or go on a trip without having to
carry large amounts of cash.