All the Essential Information for Applying for a Credit Card

Applying for a credit card online has numerous benefits compared to other methods such as applying over the phone, through the mail, or in person. One benefit is the ability to apply at any time, 24/7, from the comfort of your own home. Additionally, if you are researching different credit card options on a comparison website, you can immediately move forward with the application process once you have found the best card for your needs. On the other hand, applying in person at a bank or credit union requires physically going there and dressing appropriately, while applying over the phone may have time restrictions during the week and mailing an application results in a delay for review and a potential risk of the application getting lost.

What to Look for When Choosing Your Credit Card

CREDIT SCORE

Your credit score plays a significant role in determining the type of credit card you can obtain. To ensure that you apply for a card that you qualify for, it is important to check your credit score beforehand and target your search for credit cards accordingly. According to FICO, credit scores are typically classified as exceptional (800-850), very good (740-799), good (670-739), fair (580-669), and poor (300-579).

APR
APR, or annual percentage rate, is the amount of interest you will accrue when carrying a balance on your credit card. There are different types of APRs, such as: a fixed interest rate which stays the same throughout the entire time you have a balance on your card, a variable interest rate which can fluctuate based on market changes, an introductory APR which is a lower rate offered for a limited time when opening a credit card account, a purchase APR applied to any credit card purchases that are not paid in full, a balance transfer APR for debts transferred to a credit card, and a cash advance APR which is typically very high for the privilege of taking out a cash advance.

FEES
Many credit cards come with various fees, including annual fees that can range from $95 to $500, late payment fees of up to $29 for the first instance and up to $40 for subsequent instances, balance transfer fees of 3% to 5% per transfer, cash advance fees of 3% or 5% per advance, and returned payment fees of up to $40. Additionally, credit cards also offer various rewards such as cash back, points that can be redeemed for cash back, gift cards, travel, and merchandise, and miles that can be used towards low-cost or free flights and other travel expenses.

Having a credit card can offer various advantages, such as:

• Establishing a positive credit history by using the card and paying off the balance promptly.
• Having the ability to make significant purchases and paying them off over time.
• Credit cards also offer protection in case of issues with a significant purchase.
• Certain credit cards offer incentives such as travel or cashback rewards, adding additional value to the cardholder. It also eliminates the need for carrying cash or using a checkbook when making purchase