Credit Card Application

Morgan Hamilton asked:




Most kids can’t wait to get that first credit card. While it can be an exciting moment in a young adult’s life, it is not something that should be rushed into without doing some homework first (after all you are students). Research the criteria and terms of the card, set some limits for yourself and, if applicable, admit that you’re not ready for the responsibility. The purpose of this article is to discus the questions you should ask yourself before filling out a student credit card application.

Am I Old Enough? This one may seem like common sense but every year credit card companies send pre-approved applications to seventeen years olds enrolled in college. If you are not 18 than it is not legal for you to have a credit card, even if the company sends you a application.

Are The Terms Reasonable? The main terms you want to look at are the annual percentage rate (APR), the late and overdraft fees, the grace period offered by the company, and whether or not there is an annual fee attached to the card. The APR on student credit cards usually aren’t very low so just shop around the lowest you can apply for. Late and overdraft fees (which you shouldn’t have to pay if you stay responsible) are usually pretty much the same. Avoid cards with no grace period since you’ll end up paying too much in interest and never get a card with an annual fee.

When Will I Use This Card? Idealistically you should only use your card for emergencies. Get a debit card or pay cash for everyday purchases and impulse buys (if you can afford it). If you state that you will only use the card for emergences, go one step further and define what an emergency is. If you consider a pizza craving on Friday night an emergency, stay away from credit cards for a while. Remember to do this before filling out the student credit card application, not after you have the card in hand when the temptation may be too great to resist.

Can I Really Handle This? In other words, have you been responsible in the past? Have you usually been good with money, saving until you really needed or wanted something? Or does money seem to burn a hole in your pocket until you just have to spend it on something, anything at all?

Judy

Morgan Hamilton asked:




Getting approval for a student credit card application online has never been easier. Credit cards for college students are unique financial instruments in that they are basically designed to give credit to people with no credit history or meaningful employment. It pretty much flies in the face of everything that the credit card companies stand for.

But for banks and credit card issuers like Chase Manhattan and Discover Card, the upside is enormous in relation to the risk they take. For every student that defaults on their credit card debt, the credit card companies know that there will be many times that amount that will become long term customers. And long term customers in the credit card industry translates into big bucks.

The college campuses that blanket the United States have indeed become fertile hunting grounds for the card issuers. And when you think about it, it isn’t at all hard to figure out why. Our colleges represent the best and brightest young minds amongst us. And those bright young minds are going to be gainfully employed, hopefully, in the very near future.

When seeking a student credit card application online make sure you know the terms and conditions set forth in the offer. That means doing your homework to make sure you don’t get caught with any nasty (read expensive) surprises. Because students typically don’t have a credit history, the credit card companies will often charge higher interest rates.

They do this in part to mitigate their risk, but they also do it because they can get away with it. They know full well that your choices are limited because of your current financial situation. In short, they got you by the short and curlies and if you let them, they will pull. So don’t let them. Your college student credit card should be a valued ally, not your nemesis.

Here’s how to make it work for you. Are you ready for it, this is real ground breaking stuff… do not charge more than you can afford to pay back and make sure you pay off your monthly bill in its entirety every month. Earth shattering, original advice isn’t it? Of course it isn’t, but if students would only follow these simple rules then paying high interest rates and accruing debt will not be an issue.

Not only that but you will also begin to establish that all important excellent credit rating, that by the time you graduate and apply for an auto loan and a mortgage, you will be oh so glad you have. Also, when you see on a student credit card application online that it has annual fees, look elsewhere at other offers. We don’t work for these credit cards, they work for us.

Randall