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You’ve decided you’re ready for a credit card. As a young consumer, this is an important step in your financial future. For those who are not a new consumer but are ready to take the next step after recovering from past credit problems, this can be an important step in your financial recovery.
Consumers who are getting a credit card for the first time and who are applying for a credit card may find that the credit card application process involves a big “Catch-22”. You must have a good credit score to avail a low interest rate credit card. As a new or recovering consumer, you may have no credit or you may have bad credit. Many of you are forced to bear with high interest rate cards for years or you have to apply for unsecured credit cards that have high processing and membership fees.
take heart! Because credit card companies are always looking for new applicants, you may be in a better bargaining position than before. For those of you interested in getting your first credit card, weigh your offers and apply wisely. Most first-time applicants can easily get an unsecured credit card provided they make their payments on time and pay at least the minimum balance in full. Once you are issued your first credit card, you may find that you receive offers from other credit card companies looking for your business. The temptation to take advantage of online credit card applications that offer instant approval should be tempered by your desire to maintain a good credit standing. Overusing and extending your credit can be dangerous for your credit score.
For consumers who are recovering from a period of financial distress, getting a credit card is a bit more difficult, but by no means impossible. To avoid exorbitant fees, stay away from those tempting offers for bad credit credit cards. Usually these cards only charge half of your credit limit to get the card. Avoid cards with annual fees, application fees, and be sure to look for other hidden charges. For those of you with few options, it may be impossible to get an unsecured credit card without a cosigner. As long as the card is relatively fee free, a secured card may be the way to go. As long as you make sure to make at least the minimum payment every month, you should be able to rebuild your credit rating within a year or two and then apply for an unsecured credit card that meets your needs. .
Young consumers and recovering consumers have special needs, but credit is not impossible to obtain. Make sure to look for the best credit card rates and offers that have reasonable or non-existent fees for the best deal.
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