Credit Card Application Guide

November 1st, 2009

credit card application guideMany people will head down to the local office of the banks or credit card companies when they want to apply for a credit card. If there is a long queue, they will have to wait in line for their turn to submit their applications. Alternatively, they can call up their customer service hotlines and request for an application form to be mail to their home addresses.

As more and more households have access to the Internet, these card issuers begin to offer online credit card applications. This method allows them reach a broader base of potential customers, especially the younger generation that is more computer savvy.

Since everything is computerized and automated, the processing of the application is usually much faster and more efficient. By simply clicking a button to bring up the application form, you can fill it up on your computer screen and then click another button to submit it. Unless there are issues with your credit history or errors on the form, you can expect to get your application approved in matter of days instead of weeks.

However, online security remains the primary concern for many Internet users. Contrary to belief, online application is actually very safe and secure. The card issuers spent huge amount of money each year to ensure that their computer system is secure and hackproof.

To have a safer experience, you should only make your online application from your personal computer. Avoid public places such as an Internet cafe. In fact, you should not be doing any high security transaction from any computer located in public places.

When filling out your credit card application, there are some important details that should be considered aside from your name and contact information like the query should you accept every offer or not, the possibility of hidden fees that can be quite expensive and the like

When you apply for a credit card no matter if it is online or through regular mail you have to fill in a series of personal information and answer a few questions. As with any other type of applications it is important to fill in all the spaces with accurate information especially since you sign the application and agree that the information submitted is true. Even if you fill in credit card applications online and you get approved it does not mean that you have instant access to the line of credit. But an application that is correctly filled in will definitely shorten the period of time from the moment you got approved and until you actually receive the money. If you fill in your credit card application online you should make sure the site is secure and you have a firewall. Remember you will be asked to provide personal information about yourself and your household, employers contact and others.

That credit card application can be found all over the Internet and at your local bank. The Internet is a good place to fill out an application for a credit card; however you need to be aware of the scams websites. If you want to be totally safe, you can go to your bank to see if they have available credit card you can apply for. When you find a company that has online bank, you can find applications for there credit cards through there website. The next time you want to apply for a credit card thats worth the time and can be explained about the charges, you should get one through a bank.

Sabotaging Your Own Credit Card Use

June 1st, 2009

headacheSome people, for one reason or another, seem to unwittingly sabotage their own finances.  I’m pretty sure you’ve seen it – folks who seem to do exactly the wrong things when it comes to wisely looking after their financial success.

Look at many people’s credit card behaviors and you can see what we’re talking about.  In fact, the reality that so many people are experiencing major problems with credit cards doesn’t surprise me at all – the signs have been glaringly noticeable from the start.

Credit cards are intended as a financial convenience, not a source of liquid funds or a comfortable loan.  Having a credit card doesn’t mean you can finally afford a 50-inch TV which you couldn’t possibly handle paying for before.  It doesn’t mean you can take vacations that are well beyond what you can pay for.  Simply put, it doesn’t give you permission to consume items conspicuously.

As a society, we really do have to start looking at credit cards in a healthier manner.  Instead of thinking of all the things you can purchase using your credit balance, focus your attention on how much easier credit cards can make your usual purchases.  Rather than having to carry cash every time you leave the house, you can simply bring your credit card along and know that you can pay for any expenses that you need.  At the end of the month, the same amount of money that you would have spent should go into settling the amount you incurred on the card, instead of letting the debt pile up.

Any other way of using credit cards, unless carefully planned for, usually leads to self-sabotage your financial capabilities.  Don’t let the tempting allure of “buy now, worry later” suck you in.  Use your credit card responsibly.

Spreading Debt Across Multiple Balance Transfer Cards

May 31st, 2009

mulltiplecardsAre you planning to use a balance transfer card?  Most people who do usually find just one card with good terms and use that one account to move all their existing debt into.  While doing that is very beneficial, especially looking towards the future, it does have its drawbacks.

Unless you have an exceptionally high credit limit, it’s very likely that transferring your existing debt into the new card will fill up at least half of its available balance.  In fact, most folks who I’ve seen do balance transfers end up utilizing between 70% to 90% of the balance transfer card’s limit.  The result is a high credit utilization on a single card that can potentially cause a negative effect on your credit score.

Using Multiple Cards

One technique people are using is to apply for multiple balance transfer cards and spread the debt evenly among them.  That way, instead of fostering very high utilization on one card, you’ll end up using a small percentage of available credit among many cards.   In terms of your ratings, you are depicted as having a high line of credit, while managing it very successfully.   Essentially, it allows you to enjoy the benefits of a balance transfer card, without causing a possible dent in your credit score.

Dangers Of Spreading Debt

Getting more balance transfer cards, of course, means a few caveat.  Multiple cards, for the most part, means multiple annual fees to pay for,  multiple payments to schedule every month and more accounts to keep track off.  That’s a major consideration, especially if you’re already having trouble with all the accounts you have to manage.

Student Credit Cards And The New Credit Card Law

May 30th, 2009

choosecardsThe start of the coming school year will likely see a different scene in campus quadrangles than it was in the past.  With the new credit card law that prohibits offering accounts to students under 21 (with a few concessions), it’s highly possible that we’ll see a drastic reduction in the number of booths offering a selection of giveaways (like shirts, iPods and restaurant coupons) to applicants.

Protecting Students

It’s easy to understand why the new laws have been set.  Over the last five years, the amount of debt students have been carrying across numerous credit cards (an average undergraduate has four) have seen an alarming rise.  Instead of finishing school with their financial life ahead of them, they find themselves mired neck deep in high-interest credit card debt.

Exceptions To The Rule

Under the law, young adults under 21 can still get a credit card, provided they are able to show proof of capacity to pay (e.g. having a job) or have a legal guardian willing to co-sign the account.  Otherwise, credit card companies may not issue them any plastic the same way convenience stores aren’t allowed to sell them alcohol.


With most student credit cards aggressively marketed to freshmen, a change in marketing tactics is obviously necessary.  However, it is highly doubtful that the rule will be enough to deter credit card companies from trying to get new sign-ups.  While the current schoolyear might see a tad less marketing activity on the part of the issuers, it’s not likely to last for long.  For the most part, expect them to regroup, lay out a new marketing plan and come back strong with a different approach in the coming years.

Getting Valid Negative Marks On Your Credit Report Reversed

May 27th, 2009

businessmancallUnless it’s an errant item, negative entries in your credit report usually can’t be removed all that easily.  You can try, and that’s exactly what credit repair companies do, but there’s little guarantee that you’ll actually succeed in doing so.

For the most part, getting valid negative entries out of your credit report is a near-impossible feat.  Unless, that is, you can get yourself in a prime bargaining position.

An Ideal Scenario

Let’s say you have an outstanding credit card balance that you haven’t been able to pay the last six months.  No doubt, your credit report has already suffered, with tons of red flags created by the recent inability to settle your obligations.  Then, due to some good fortune, you came across a sufficient amount of money that allows you to settle the existing debt.  In this situation, you have a very good shot of getting most of the negative marks caused by the credit card on your credit report removed.

When you call up the bank to pay the balance in full, make sure you negotiate removal of your negative credit items as part of the deal.  With the current economic climate that sees cardholders miss out on more and more payments, the bank will usually give in to reasonable demands if that means getting the money they are owed.

Getting Help

You can most definitely do this on your own.  If you’re hesitant, though, or find it difficult to hold your own in negotiations, you can employ the help of professional debt consultants who can perform the process on your behalf.  If you get a good one, they can probably even negotiate parts of the debt removed, making whatever fee they charge no added cost whatsoever.

Credit Card Fees To Watch Out For Going Forward

May 26th, 2009

feesfutureWhile the new credit card laws will prohibit a number of old fees and billing practices that have left consumers worse for wear, they haven’t put a complete lockdown on the way credit card companies can take advantage of you.  In fact, you can bet that they’re already looking forward to recouping much of the losses the new rules will generate by tacking on new fees and other premiums.

Need a quick review of what credit card companies can no longer do?  Under the new law, the following practices are no longer allowed:

1. Over-the-limit fees
2. Double-cycle billing
3. Interest rate hikes on old balances (unless the customer is 60 days late)
4. Charges on online payments

While that may not sound like much, those few changes represent a large chunk of how credit card companies turn up such huge profits from the use of their cards.  Going forward, you should probably look out for the following fees which they may or may not begin charging to make up for the deficit:

1. Fees for checking your balance (like some bank ATMs do)
2. Annual fees for cards that used to carry no annual fees
3. Rewards programs enrollment (it may be a longshot, but I can imagine issuers charging for enrollment into their rewards programs)
4. Across-the-board interest rate hike for future purchases (which is allowed under the new law, with no cap)
5. Shorter grace periods (to maximize the interest)
6. No more 0% promotional offers

Sucks, right?  Personally, I can’t imagine credit card companies responding any way else.  They’ve been in business for a long time because they manage to adapt.  It’s too bad that they usually do it with us on the receiving end of the negative repercussions.

Credit Card Users Behaving Badly

May 25th, 2009

30sIt’s so easy to observe people doing things incorrectly, while too difficult to notice the same behavior on yourself.  Even long before, I’ll see credit card users flirting with disaster from a mile away.  Yet, when the time came that it was me in their situation, with my credit about to plunge into dangerous territory, I hardly saw it coming.

What sorts of things do you need to look out for to know when you’re in a similar boat, about to tread perilous waters?

1. Buying stuff on impulse

Any unplanned purchase always carries a big risk.  Can you really afford it?  Without the proper forethought, you increase your chances of buying something that you really can’t afford.  If you notice yourself doing it even once, take notice.  When you find yourself repeating the same behavior in a pattern, it’s time to take a serious look at your relationship with money.

2. Rationalizing irrational purchases

“I deserve it,” that’s what most everyone says when faced with the folly of the things they spend their money on.  You’ll probably live through it if you can actually afford the expense.  If you can’t though, “buying things that you deserve” can prove to be your ticket to financial ruin.

3. Paying for luxuries

If you’re using your credit card to pay for luxuries, without settling the balance month-to-month, you can rack up a huge bill without anything to show for it.  Think about it hard.  That holiday charged completely on your credit card might have entertained you for the weekend, but you’ll be paying for it in never-ending fashion if it’s really not within your means.

Credit Cards And Money In Your 30s

May 24th, 2009

impulseshoppingIf you’re in your 30s, you’ve probably had some amount of experience with credit cards.  Most likely, you’ve held a job or two, perhaps even started a business during the previous years.  Hopefully, you have started putting money away for the future, even though it wasn’t quite clear in your 20s what you’re supposed to be saving for.

1. Keep your credit card life simple

Put succinctly, make sure you live within your means.  If you’re the type to spend a little too wildly in your 20s, you’ve probably experienced the sting that excessive credit card use can do to you.  Should that past mistake be a little too serious, you might still be experiencing some of its repercussions.

In your 30s, try to keep a more level head about the way you use credit.  If you really can’t afford an apartment in the city, then don’t charge your living expenses to your credit card just so you can pursue it.  When a flashy car just doesn’t tally up in the spreadsheet, don’t force it on your credit.  Keep it simple – you’re getting old and there’s just too little time to waste on making more serious mistakes.

2. Clean up your debt

The 30s is the best time to start putting your money in tangible things, such as a house or an investment portfolio.  The less debt you have, the more of your resources you can allocate towards those important things.  As such, do your best to make it happen.

3. Start thinking about the distant future

While your retirement is still a long time away, almost every financial expert will tell you that this is the critical period for you to start on the road preparing for it.  While we’d rather ignore the signs, it’s inevitable – we’re inching closer to it.

Credit Card Debt Can Put Your Life On Hold

May 23rd, 2009

debt11Dealing with debt is a hard and stressful activity.  In fact, it’s one of the toughest things most anyone can go through, regardless of how intelligent or how talented they may be.  It is so difficult, that at times, people working through it can feel that they’re putting their life on hold.

Cutting Back

When you’re paying off debt, you’ll need to cut back on most everything.  Those three beers at the bar after work may have been peanuts last year, but when you’re settling arrears, even the smallest savings can accumulate into building up that monthly payment.  As such, it is more important than ever to prioritize where your money goes.

Cutting back, however, does not mean deprivation, although it can feel that way.  Instead of that quarterly family vacation you used to take south of the border, how about substituting weekend day trips to see local attractions instead.  Sure, it’s not the same, but that’s the beauty of life – it can be enjoyed even with the most meager means.

Enjoying Life Without Money

One of the reasons you likely ended up in debt is that you thought you needed plenty of money to enjoy life.  In fact, there are many more facets to living than the things money can buy.  Look at the time when you’re settling your debt as a chance to begin appreciating them.

Living With Pressure

The most profound effect of living in debt is the constant pressure.  One slip-up in monthly payment, after all, and your restructured debt plan just might get thrown out the window.   However, those are the cards you’ve been dealt with – accept the situation and make the best of it.  In truth, many people have been in worse boats than you, yet have continued to live happy lives.

Teaching Kids Credit Card Management

May 21st, 2009

teencardHow do you teach your teens credit card management?  According to most experts, the best way is to get them on it early via prepaid credit cards.

Prepaid credit cards work much like regular credit cards, allowing you to shop without cash, most anywhere you go.  Unlike regular credit cards, though, you can set the spending limit depending on how much funds you decide to put into it.  Whether it’s $100, $200 or $500, the prepaid credit card holder gets to charge only that and no more.

Many issuers allow credit card holders to apply for prepaid credit card extensions to their main account.  That means a parent can easily ask for prepaid credit cards issued to their children, which they can then use to give their kids allowance.  Some prepaid credit cards, such as those from Discover, are also enrolled in the rewards program (among other benefits), which means the children are able to make full use of features regular credit cards come with.

How exactly will this help teach kids credit card management, though?

1. Kids are exposed to responsible use of the card, forced to keep spending to within their “credit limits”.

2. With monthly statements, parents can get together with their kids to review their spending and talk about potential problems.

3. It helps educate them about what a credit card is about – a tool of convenience, not an avenue for unlimited spending.

4. It helps give them an idea of how to maximize rewards programs and other credit card benefits