Category Archives: Credit Cards

Credit Card Interest Rates

How to Get a Lower Interest Rate on Credit Cards

One of man’s greatest inventions is the credit card. By just using a piece of plastic, you can buy groceries, buy a plane ticket, shop, eat in a posh restaurant or do anything you fancy. It is the apex of human ingenuity applied in the field of finance and daily living and it symbolizes the purchasing power of the modern man. However, very few people realize that it is also a very expensive financial tool. It would be most ideal for people if they can get a lower interest rate on credit cards.

The most expensive credit facility

Credit Card Interest RatesUsing as a credit card will cost the cardholder loads of money in the form of high interest rates. The credit card is a form of unsecured loan that usually charges higher interest than car loans and other loans that have some sort of security. The creditor has no control over the amount that the cardholder will purchase by using the credit card.  It is because of the fact that the card holder has a freehand in using the card that financial difficulties start to brew. When hard times come, credit card holders tend to use the card more to make up for the lack of income being experience, unwittingly driving up the cost of living.

Controlling the Use of Credit Cards

It is therefore wise to control the use of credit cards to manageable levels in order not to suffer from the consequence of high interest costs that follow. Some groups of people have a lifestyle that makes it hard for them to control the use of their credit cards.  If you belong to this category, your only solution is to find a way to obtain a lower interest rate on credit cards. The best way to do this is to negotiate with the company that issues your card. It is not hard to transact with credit card companies because they are always accommodating to their clients.

Negotiating with the Credit Card Company

If you notice that the use of your card has significantly increased, you should make an appointment with your credit card company and negotiate for a reduction in interest charges. You have to make a quick survey of the prevalent interest rates of various loans in your locale so you can negotiate better.  Ask the company for a lower interest rate mentioning the fact that you have substantially increased the volume on your credit card.  Most credit card companies will acquiesce to such requests because they value the high volume of business generated by their credit cards.

Other Options are Available for the Cardholder

You should not lose hope if the credit card company will not consider your request. There are other ways to get a lower interest rate on credit cards.  One way is to reexamine your lifestyle and see if you can get rid of some extravagant expenses that you don’t really need. Another way is to transfer your balance to another credit card company that offers lower interest rates on their cards.

Approved and Rejected Applications

Why Was My Credit Card Application Denied?

You are very excited! You have applied for a credit card and you are now ready to charge that vintage bag to your much awaited card. All the while, you have assumed that it will be delivered after weeks of application. But your impatience looms after several weeks; and upon checking with the company, you finally heard what you least expected: “I’m sorry, your credit card application has been denied”.

You are left with questions hanging on your mind but no specific reasons are given by the credit issuer. This so familiar circumstance is being encountered by many credit card applicants. If you’re still wondering why you are rejected, below is a list of the most common reasons:

  • Approved and Rejected ApplicationsInsufficient information supplied. The application form you are filling in is very vital and will be used as the main reference; it is highly advisable that you carefully check on your forms before submitting them. Apart from this, required documents such as identification cards and financial records must be complete. Missing and incorrect information will likely be a basis for your rejection.
  • Financial status. Income requirements vary among different card companies. There are those who only require a minimum but there are companies who even check on the borrower’s work history to justify that they can consistently pay for their loans. If you have a very low income or an unstable job, there will be a great possibility that you will be denied.  
  • Bad credit report. If your financial record states that you haven’t paid for your long standing loans or if your loan balances are too high, your chances of being approved is very slim. Pay for your outstanding debts first before applying to clear out your credit balances.
  • Several credit cards. Over access to too many credit companies will make lenders think if you are still capable of paying another one. Always remember that credit companies offering multiple cards will not approve individuals who have already been using one of their cards. Furthermore, applying for several cards will make you look over stretchy who badly needs an overdraft account to cover for your debts. 
  • Charge-off. This is a credit card balance that is not paid for six months or more. This will pose a negative picture on your credit report since this is a declaration that your existing card company cannot collect payments from you. This will thus be a factor for your rejection.
  • Very limited borrowing experience. There is a risk of non-acceptance if you haven’t used any lending facilities before. Not having a credit score will not prove your history of managing your debt and will not assure the credit companies that you are responsible on paying off bills and debts on time.  

It’s really frustrating to have your card application disapproved especially if you have spent time comparing and finding the best credit card for you. If you have recently been rejected considering your good credit standing, it will be timely to check your file to know what has affected your unsuccessful application.

Credit Card Interest Rates

What Is a Good Interest Rate on Credit Cards?

Credit card interest rates usually presented as APR or Annual Percentage Rate is the fees paid for spending money that in normal terms, users cannot immediately avail of. Although all credit card companies offer interest rates, there are still numerous who are overcharging. This article will present details on how to identify good interest rates a company may offer.

  • Having a good credit score will let you avail of lower interest rates. Generally, a 10% interest rate cards are reasonable enough but there are still some who offers a rather lower rate. One of the requirements to qualify is a way above the average credit standing. If you are not sure of your credit points, you may browse several sites which offer credit card computation for free.

In addition, those with secured credit are ensured of having the base introductory offer of about 6% while those with less than perfect credit score will be able to avail of cards having 10% to 30% rate. Individuals with low credit points can still avail of a good interest card from a credit union. It allows its members to apply online and gives a 9.9% to 12% APR.

  • Credit Card Interest RatesCredit cards have rewards programs attached to them and comparatively, those with these programs charges higher interest rates. However, companies with rewards cards however should only have at its lowest, an interest rates ranging from 10.99% – 19.99%.
  • Good interest rates are also dependent on the person’s location since the APR varies from country to country. In US for example, the APR ranges from 6% to 40% whereas in UK, it ranges from 18.9% and above.
  • Good credit card interest rates should be standard. There are credit card companies which claim to offer 0% fixed rate to acquire applicants when the truth is this is only for 6 months or 1 year. Unfortunately, there are also those companies which impose hidden charges for every transaction made on the card and these add up to the interest rate.  There are also companies which impose different rates for each transactions; this is acceptable as long as the rate imposed is clearly specified on the terms and conditions.
  • A good interest rate offering does not totally mean a superior credit card. There are cards with higher rates but are very flexible on giving its consumers with lots of cash back, flier miles and discounts. Generally, these high rates are meritorious given the enumerable perks you can get. Contrastingly, there are also companies offering low interest rate but consumers are given exorbitant fees for over usage, frequent cash advances, and the like. 

Having credit cards is not totally disadvantageous if a person will just be aware of the fine prints attached to it. Interest rates of credit companies vary and this should be a main factor in choosing the best card suited for your needs. Being insightful and inquisitive of all the rates included on your billing statement might save you a lot of charges and may result to a very good credit score.

Credit History

What Is a Hard Inquiry on My Credit Report?

A Hard inquiry is a specific type of credit inquiry. This is in relation to a consumer’s credit report and score. This article will discuss several important aspects regarding the same.

Credit Inquiry

Realistically speaking, any entity i.e. corporation, person, bank, lender, etc. can pull out your credit reports. Most consumers are not aware of this, but their credit reports get checked numerous times without their knowing it. More often than not, these are from entities that have something to sell and want to see if the consumer pre-qualifies for their “promotional offer”.

Soft Inquiry

Any credit inquiry that was not expressly authorized by the consumer is a soft inquiry. This means that it should not be included in a credit report in the first place. And, even if it does, it should not be considered in calculating the credit score. Why? This is because the consumer had no control over the actions of the inquiring entity. In some cases, the credit bureau should not have even provided the information.

Hard Inquiry

Credit HistoryAny credit inquiry by any entity that has your EXPRESS authorization. This usually means in writing. Some consumers are not even aware that they have already signed an express authorization. This is because the same is included in the terms and conditions, is an oversimplified “check box”, or the consumer was just not paying attention.

As a general rule, any application for the facility of credit will involve you signing a waiver. This includes personal loans, auto loans, home loans, application for insurance, application for utilities, application for a mobile phone, credit card application, checking account application, etc. In fact some employers pull out credit reports for individuals who are applying for a highly confidential or finance related position.

Whenever you sign anything that involves you applying for something, ask the representative if the waiver includes the pull out of your credit reports and if they will pull out your credit reports. While you are at it, ask what credit reports they will pull out. If they say, they may or may not, it usually means they will.

Important Tips to Remember

A popular myth is that credit inquiries will ruin your credit score. In reality it can lower your score but only by a few points. Unless you lack credit history, and do not have various types of credit available (i.e. checking, credit card, loans, etc.) the same is not too significant.

There are however instances wherein checking the credit inquiry section of your credit report can help you earn a few points back. First, if you are sure about every express waiver you made, and there are hard inquiries listed on your credit report that you did not authorize, you can dispute the same. Second, if you see a credit inquiry that is already more than 2 years old but is still reported, you can dispute the same.

You can dispute the hard inquiry online, on the phone, or by writing a dispute letter. Make sure you address the letter to the credit bureau that listed the information on its credit report. The contact information can be found on the credit report itself.

Credit Card Rewards

Best Credit Card Rewards Programs

Now is the best time to get a new credit card because companies are giving away lots of rewards when you sign up for a new card.  The rewards given away range from free cash, free airline tickets, free merchandise and many other perks they can think of offering to their clients. These are real bonuses that you can use and enjoy when you sign up for credit cards. You can have all these if you have a credit score that qualifies you to sign up for a new credit card. Credit card companies offer different sets of bonuses and perks and it is up to you to choose which one offers the best credit card rewards programs. The following are some of the companies and a brief rundown of their offers.

Credit Card Rewards1. Capital Venture Card – For people who travel a lot, this is the card to have. It offers reward points amounting to around 2% on all travel-related expenses which the cardholder can redeem and pay for his hotel bills, airline tickets, and other travel expenses. There are no requirements imposed when the rewards points are redeemed. The cardholder simply pays for the current bills using his accumulated bonus points. It offers a 100-dollar signup bonus and is one of the cards that offer the best credit card rewards programs.

2.  Blue Cash Everyday – This card from American Express is what you should have in your hand if you are a great spender and have an excellent credit record. It offers 3% rebates on your first $6000 purchase in stand-alone U.S. supermarkets and 1% for succeeding purchases. It also offers 2% cash back on gas purchases from selected filling stations and all purchases from specified major department stores nationwide. The rebates come in the form of statement credit which can be redeemed through the Reward Dollars plan. There are no other requirements like minimum purchases or enrollment to the bonus offers. You are entitled to $100 dollar cash bonus when you spend at least 1,000 dollars on the first three months.

3. Chase Freedom Visa – This is another cash back credit card issued by JPMorgan Chase.  It offers a remarkable 5% rebate for all your quarterly purchases in selected rotating categories like groceries, gas, travel, department stores, movies, restaurants and the like, which can translate into big savings if you plan to purchase in bulk.  It offers a 1% across-the-board rebate on all other purchases. It gives a 100-dollar cash bonus on the first 500$ you spend.  It does not charge annual fees.

4. Bank Americard Cash Rewards – Cards with the best credit card rewards programs usually have excellent cash back offers.  This card offers a 100$ cash bonus on your initial qualifying purchase and does not charge annual fees. You enjoy a 2% cash back bonus on grocery purchases and 3% cash back on gas purchases if you spend a combined 1,500 dollars purchases per quarter for both gas and groceries.  The card also offers 1% cash back on all other purchases.

Credit Cards for Different Credit Scores

Best Credit Cards with No Annual Fees

Applying for a good credit card encompasses thorough examination of the perks that the credit company gives. Comparing credit companies is by far the most logical way to avail of the best card supplier. One of the basic fees that can increase the interest rate is the annual fee. But there are some companies which offer a no annual fee card such as the following:

 1. Citi’s Simplicity Card. This is the most famous card among its product line. Aside from a waived annual fee, it also offers the lowest introductory APR, no penalty rate and late fees for 18 month membership and the annual fee is waived. Added services are an online account management, customer service available 24/7, constant protection of account and price rewind wherein purchases can be registered to Citi’s website; the company will then search for retailers who may offer lower prices within 30 days upon date of purchase. Once Citi found a store with lower prices, the price difference can be claimed back.

Credit Cards for Different Credit Scores2. HSBC. Hongkong and Shanghai Banking Corporation claims to offer a no annual fee card for life. Apart from this, a low interest rate on purchases, balance transfer and cash advance are an added offer. It also has the Home and Away Privilege Program wherein instant discounts on accommodation, travel, shopping in Australia and other countries are given away.

 3. American Express’ Blue Cash Everyday. Another no annual fee credit card. The company offers cash back gained through qualified purchases. Cash back can be availed as a credit statement, merchandise and other gift items through Rewards Dollars. American Express gives certain cash back on different US establishments such as 3% on stand- alone supermarkets, 2% on gasoline stations and select department stores. As a welcome offer, new card members are entitled to 100 reward dollars for $1,000 spending.

4. Virgin credit card.  Aside from the fact that there is no annual fee for a lifetime, this card offers a number of benefits. It gives interest free purchases for up to 44days and an annual rate of 18.99%.  A reasonable 2.9% per annum balance transfer rate for 6 months can also be availed. Virgin credit card takes pride of their Fraudshield which is a system that protects the users and their transactions by detecting irregular purchases made on the credit card.

5. Citibank’s Ready Credit. This is a great choice for borrowers who want to use plastics to cover for bills, groceries, and other personal acquisition such as car, vacation or home improvements. Guaranteed to have 0% annual fee, it’s also the best option for individuals who want to combine all debts into just a single credit facility. Ready Credit offers worldwide privileges and discounts such as free bottle of wine each time the user dine in a Citibank partner restaurant.

There is still a lot of no-annual fee credit card, and the key is just research. There is no reason for charge-off if a user will just be careful on choosing the best credit card company. Annual fees can really be skyrocketing high, but there is a definite way on how to eliminate them. Being fully aware by examining the fine prints will be one of the keys.

Application For Credit APPROVED

How to Increase Your Credit Card Limit

Credit cardholders sometimes feel that they need to increase the credit limit of their cards. This is probably because they actually prefer to purchase more stuff using their cards. Other cardholders say they feel like they have more freedom when using their credit cards to spend and would like to increase their credit limit to allow them to buy more goods. There are procedures to follow in requesting for an increase in your credit card limit, but there are several things to consider before you file a request to increase your credit card limit. 

Timing is an important consideration

Application For Credit APPROVEDIn the credit card business, the usual practice is to grant credit limit increases only to cards that have been used for at least six months. If your credit card has been in use for less than six months, there is very little chance for your request for increase in credit limit to be granted. If your card has been in use for only 5 months, it is advisable for you wait for another month before making a request to increase your credit card limit.

The Reason for Increasing Your Credit Limit

It is important to determine why you need an increase in your credit limit because you will surely be asked to explain the reasons for your request. One of the valid reasons for increasing your credit line is additional income. When you have more money to spend, it is natural for you have a higher credit limit.  When you apply for an increase, you will be asked to justify your request so you should be ready with facts and figures to support your request. Your best justification is your credit history or good paying habits and the satisfactory way you have so far managed your credit card account.

Asking the Credit Card Company for Approval

The only way to increase your credit card limit is to convince the company that you need one. When requesting for the increase, you must be firm in your decision and be frank in informing the company you will be looking at other options if your request is denied. You can mention that you might be forced to do a balance transfer in case you are not given an increase in credit limit. If you have been a good paying customer, there is no reason why the company will not approve your request. The important thing to remember is that you should ask for a reasonable credit limit increase based on your history of using the credit card.

Ask for the Credit Limit That You need

Usually, an increase of 10% over your last credit limit will suffice; but you can ask for a bigger increase if you really need it. You can ask for a 25% increase but this is probably the highest increase that any company will approve.  Requests for increase of credit card limit higher than 25% are seldom granted by credit card companies.  On the average, a 15% increase is an ideal figure that can be easily negotiated.