Our local and global economy operates on credit, what options do you have when it comes to starter credit cards. In today’s world, credit is used for almost everything. Getting approved for a house or apartment, a car loan, a job, and much more.
When you are starting out in the credit world, no credit sometimes is treated as bad credit. Lenders are hesitant to extend credit to you because they don’t know how likely you are to pay back the loan.
How to Choose the Best First Time Credit Credit Card for You
Building credit is not hard, but it does take some good decisions to build a great credit score. Everyone has to start somewhere in this credit world. One way of establishing your credit profile when you have limited credit is choosing the right card. A good credit card can help you start building a desirable credit score.
There are some common things to look for when deciding on a credit card. Not all credit offers are good to accept.
Things to Evaluate When Selecting Credit Card Options
When evaluating credit card offers, look for an unsecured card. Oftentimes, people with no credit quickly opt to get a secured credit card that requires a refundable deposit, but there are creditors that are willing to give you a chance without putting down your hard earned cash.
Some common things to look for is the exact terms of the credit loan. When it comes to becoming a new credit card holder, the fine print definitely matters. You want to take a look at the credit limit possible. You also want to see what the interest terms are. Some credit cards have a fixed interest rate and some have variable rates. This is very crucial information.
Don’t be shy about comparing interest rates. The amount of interest you pay on the money you borrow is essential to know. For instance, a card with a 14% interest rate is definitely going to be a better choice than a card with a 26% interest rate. The amount of interest you pay back on the loan is based on this rate. There is no need to pay back more on the money you borrow than necessary.
Finding Credit Cards with Perks and Rewards
Credit cards can have some great benefits. New credit card holders should know some of the perks that come with having a credit card. There are credit cards that offer cash back, reward points, frequent flyer miles, and all sorts of incentives. This should help you choose the card that is best for you. Your lifestyle should determine the type of card perks that you will choose. Choosing the right card is so important.
There are a few key points to keep in mind when you are building your credit. First, make sure you make your payments on time always. How you pay your credit card bill will determine what your credit score will be. In addition, credit card limit utilization. Although it might be tempting to charge up 1000 on a 1500 credit limit charge card; this is not a good move. You want to make sure your debt to income ratio is good. A large part of your credit rating depends upon this. Creditors want to know if you are going to max out your spending limits. This shows poor credit management.
How to Build Good Credit
Building credit takes some time and discipline. New credit card holders have to think about the long term instead of instant gratification. It is important to borrow only what you can afford. It is a good habit to be able to pay off your balance monthly. This helps you not overspend. When you start to develop good habits, you will build good credit and start to enjoy the benefits of having a good credit score.
Listed below are some credit cards that are good for people that have limited credit.
Capital One Platinum Credit Card. This card can be fairly easy to get approved for. One perk is there is not an annual fee. However, the interest rate on this card is a bit high, 24.99%. This is a pretty high interest rate. If you do choose this card, get it, keep it for 6 months or so and make on time payments. After good payment history, you should begin to qualify for credit cards with better terms.
Fingerhut Credit Account issued by WebBank is another credit line that is fairly easy to get approved for. Normally, the will approve you for at least $200. This company has over 500,000 products, electronics, household, toys, clothing, and much more. Making on time payments will result in a credit increase and you will see an improvement in your credit score.