Apply For Credit Card-Getting Approved For A Credit Card Can Be Difficult
Getting approved for a credit card can be difficult without a positive credit history working in your favor. It's a Catch-22: To obtain a credit card, you need a good credit history. But to have a good credit history, you need to establish good credit!
This no-win cycle can keep people with a non-existent, limited or negative credit history from getting approved for a credit card. But it doesn't have to if you understand the type of credit cards available and how to build a good credit history.
When it comes to credit cards, the type of card you apply for will depend on your situation. If you're a student, you'll, naturally, sign up for a student card. But if you're a non-student with a non-existent or bad credit history, a card that is secured or obtained with a co-signer may be your best option. With co-signed credit cards, the co-signer guarantees and is responsible for the debt. This means that the co-signing person is responsible for paying the full amount of the debt if the card holder doesn't pay. In fact, when co-signed debt goes into default, three out of four times co-signers are normally asked to repay what is owed, according to the Federal Trade Commission.
Furthermore, the issuing bank can attempt to settle the debt without first trying to collect from the card holder. The bank can also use the same collection methods against the co-signing individual, including suing and garnishing wages. If the debt is not paid, it can leave a negative mark on the credit history of the co-signer, as well as the card holder.
Despite the risks, a co-signed credit card can be great tool for helping a friend or relative build their credit history so they can one day obtain a card on their own. Secured, co-signed and pre-paid credit cards offer viable options. But you should start building a strong credit history, so you can obtain a regular credit card on your own in the future.
First, you need to understand how credit card issuers determine credit worthiness. The approval criteria varies from among issuing banks, but generally relates to what's often called the three C's of credit: capacity, character and collateral. Capacity refers to your ability to pay based on your income and existing debt. Collateral refers to any assets you have that can secure payment, such as bank accounts or home ownership. Character refers to factors like your payment history, length of employment, etc.
To get a good idea about how your application will fare with credit card companies, check your credit history with one of the major credit reporting agencies: Experian (www.experian.com), Equifax (www.equifax.com) and TransUnion (www.tuc.com). These agencies access your payment information directly from the companies you have credit with, as well as from government agencies such as the legal court system.
Credit reporting agencies use the information in your credit history to determine your credit rating or credit score. Credit scores, also known as FICA or Beacon scores depending on the CRA, generally range from 350 to 850. Most banks will approve you for credit if your score is at least 620. If your rating is 720 or higher, banks will offer you their lowest interest rate.
Generally, y our credit score is determined by your payment history for the last two years. T echnically, CRAs calculate your score using a closely-guarded formula. TransUnion, for example, determines credit scores using a variety of factors, including: how you pay your accounts, how much you owe and how often you've applied for credit.
http://www.credit-cards-rates.co.cc/
Article Source: ArticlesBase.com
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How do I negotiate delinquent credit card settlements?
I got my first credit card when I was 18, I've always held a job and I always made my payments on time. Here I am 4 credit cards later, I lost my job about 8 months ago and I've been struggling to pay my bills and my rent, I'm about 6 months behind on my cards because I've been concerned with surviving day to day. I finally have a job but I'm still barely making it by. One of my credit cards recently sent me a letter negotiating a settlement, I'm wondering if I would be able to do that with my other credit cards. I have 2 Capital One cards, a Macy's card and a Walmart card. All of these cards are basically double what they were before I lost my job, most of the debt I owe now is from fees I was charged due to missing payments or late payments. I feel like I'm drowning, I need help. However my debt is not substantial, but my credit is really suffering and I have a minimum wage job. I don't know what to do.
How do I negotiate with the debt collectors, should I just call and ask for a settlement?
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What should be my first credit card ? Which one would be the easiest to get ?
I'm 18 years old and I'm thinking to apply for my first credit card. I have no income yet, and I'm not sure what would be my best option and the requirements for it.
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Do I have "too much" credit in a negative way?
I am 29 years old. I got my first credit card in 2005, which was a secured Visa Gold through my bank. I wanted to build credit in general. I paid it so well that they made it unsecured after only 10 months and gave me my money back for the deposit, instead of waiting the full year. Over time there were various things that I needed to buy or have done (such as dental work) that I knew I could pay off over time but didn't have the immediate money for. Sometimes I would end up with a balance that I knew I could pay off with time, but was getting killed in interest. I would do a balance transfer to another credit card that I newly opened for the purpose of saving interest and paying it down even more quickly to get out of debt. That left me with 6 cards.
American Express Clear: $25,000 credit limit (don't ask me why they gave me that) - opened in 2006.
Discover More: $12,500 credit limit - opened in 2007.
Bank of America Accelerated Rewards American Express: $10,000 credit limit - opened in 2008.
Citi Platinum Select Mastercard: $13,000 credit limit - opened in 2009.
Chase Freedom Visa: 11,000 credit limit - opened in 2008
Chase Slate Visa: $5,000 credit limit - 2010
All are in good standing and never a late payment on them. I try to keep them active by running a lower purchase through them and/or paying a bill through them and then paying it off in full after the statement posts...usually every 3-4 months.
I'm not in a bad financial situation. Someday if I want to buy a house and have zero balance on all of these cards...will it hurt me? One of my previous general credit scores was 763 (I know there are all kinds of FICO, myFICO, etc. so it can go up and down depending on which score and report was used). I don't live by a credit score, of course. I use credit when I need it to better my life and make it work for me. Should I get rid of some? To my understanding, even closing an account in good standing (particularly if it has been open for 5+ years) has no impact since it stays on your credit report (is this a life-long thing or a certain amount of years only?).
I should also note that I got most of these before the "credit crunch"...when companies were more liberal. Some of them, like American Express, kept increasing my limit. I only make about $20K or less per year currently, but I have better credit than most of my family. My mother actually had her American Express credit limit dropped a little, a while back...due to higher balances. I have no balance on mine and they haven't touched that $25K (which I'll never ever need that much in life or even half of that, for that matter). I wouldn't mind if they dropped that limit down to a more reasonable limit, but I have been told by many to not call and ask for them to lower it. People said they take that as a negative sign (even if I have NO balance on it) that I "can't pay my bills" or whatever and that they may cut the card altogether if I requested a lower credit limit. I feel a little odd that they have such higher available credit limits, which the compa
Also, before anyone bashes...I know there are people who need one for emergencies and yet can't get approved for one due to the credit crunch. Yet these companies, for whatever reason, allow me these higher balances without even cutting them a little bit to free up more of their potential credit for other people. It confuses me a little, but at the same time, I'm trying to stay in good standing in general with my credit.
Also, before anyone bashes...I know there are people who need one for emergencies and yet can't get approved for one due to the credit crunch. Yet these companies, for whatever reason, allow me these higher balances without even cutting them a little bit to free up more of their potential credit for other people. It confuses me a little, but at the same time, I'm trying to stay in good standing in general with my credit.
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