It seems like a relatively easy process to apply for a credit card. With all the pre-approved applications sent to your house, you may be under the impression that you are automatically eligible but this pre-approval process isn't a 100-percent guarantee, and the cards that come in the mail may not be your best option. It is important to research your options first to make sure you are applying to the cards that best fit your financial needs and budget. Consider the three main steps you need to know to apply for a credit card to meet your financial goals. Step One: Evaluate Your Credit Report Every credit shopper's first step should include looking at their credit report. If you don't know where you stand in the credit market, then you will essentially waste time on applying for the wrong cards. Generally, anyone with a FICO score of or above will have the easiest time applying for credit as banks will be more willing to work with you.
When evaluating your report, look specifically at:
Any errors that you could correct to improve your score
Fraudulent accounts Step Two: Choose the Right Bank All credit cards are issued by banks and credit unions. Even store credit cards are affiliated with some of the big banks that offer consumers lines of credit. Before you apply for any old card, you should determine the best venue based on your own credit history. Store cards are among some of the easiest to obtain if your credit is less than perfect but they also have some of the highest APRs of all cards on the market. If you choose to use a store card, it's important to have a sound payment plan in place so you can pay off the principal balance as quickly as possible. If you are recovering from a credit catastrophe, you can consider a secured card. Secured cards are designed to help people with bad credit with scores that fall below 600. When you make timely payments over a significant period of time, you score will start to increase-just make sure that the company reports to the credit bureaus. Also keep in mind that you need a deposit in order to open a secured card. If your credit is in great shape, then there is no reason you shouldn't apply for a regular credit card. The key is to choose a card with a low APR so you don't waste too much money on interest. To maintain your FICO score, don't spend more than 30 percent of the available credit limit at any given time.
Step Three: Submit Your Information There are three main ways you can apply for your card: in person, through the mail and online. Store credit cards are commonly opened onsite with a salesperson, and you may also apply for a card at your local bank. Other consumers mail in their pre-approved applications, or they may decide to pick up a form from the bank and mail it in. If you want a quick and easy way to apply for a credit card, you should strongly consider completing the process online. Credit card applications are basic, but you need to make sure all the information is correct avoid any rejections. The most common mistakes include wrong:
Social security number