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12 Steps How To Apply For A Credit Card (Complete With Pictures) - How To Apply For A Credit Card - Applying for a credit card can be confusing and intimidating if you are not sure exactly what to do. Not only are there countless types of credit cards, but each one can have different rules to follow, different interest rates they charge, along with a variety of perks. Whether it’s a retail store credit card, gasoline credit card, or a major credit card issued by a bank, it’s best to have sufficient and accurate information when you apply for a credit card.

Researching A Credit Card

How to Apply for a Credit Card: 12 Steps (with Pictures)

1. Decide what type of credit card is best for your needs. Make a decision based on what it is you plan to use your credit card for. There are many different kinds of credit cards. Here are just a few:

Standard credit card. Do you want a card to increase your monthly buying flexibility? Maybe you're just tired of handing out cash or going to the ATM every second day. These credit cards come unsecured, which means that you don't need to put down a security deposit to prove you can pay your debt off.

Rewards credit card. Do you want to earn rewards with a specific retail store, gasoline company, or airline so that you can redeem your points for clothes, mileage, or vacations?

Business credit card. Do you need to open a line of credit for your fledgling small business? Business credit cards come with special bonuses that might appeal to a business owner.

How to Apply for a Credit Card: 12 Steps (with Pictures)

2. Look at rates and benefits. Figure out which type of card is best for you by what their interest rates are and what specific benefits the company offers before choosing one. Some things to keep in mind include:

Annual Fee - Many companies charge between $15 and $50 for use of their card. This fee can sometimes be waived if you are a frequent user of the card, transfer a specific balance to the card, or, sometimes, just for asking!

Annual Percentage Rate (APR) - APR is how much money in fees and interest you can expect to pay on top of the principal that you borrow. If you pay $50 in fees and interest after spending $500, your APR would be 10%. Your APR can be either a "fixed" or a "variable" (floating) rate.

Fixed rate generally are a little higher, but you will know what to expect each month.

Variable rates are based on a current published index coupled with an additional percentage.

Grace Period - This is the amount of time between when your transaction is posted to the account and when interest begins to be charged to it. This is usually 25 days from billing time, unless you carry a balance.

Late, over-the-limit, and account setup fees - Most companies charge you late fees (for paying your bill late) and over-the-limit fees (for going over your credit limit), but it is very rare for a company to charge an account setup fee.

How to Apply for a Credit Card: 12 Steps (with Pictures)

3. Know your credit score. Your credit score is a score on a scale from 300 to 900, with 900 being the best. This number is used to express an individual's creditworthiness, or how likely s/he is to repay a debt. 650 is an "average" credit score, while anything above 700 is considered great and anything below 620 is considered poor. Your credit score will affect your ability to get a credit card.

Your credit score is based on different factors, like your payment history and the age of your credit.

How to Apply for a Credit Card: 12 Steps (with Pictures)

4. Be mindful that having a credit card may encourage you not just to spend more money, but to spend more money than you actually have. Studies show that people who use credit cards tend to spend more than people who use cash. Scientists think that the experience of parting with real money in real time is fundamentally different from the experience of pledging to part with real money at a later time.

Scientists also know this: people who buy a laptop, say, with a credit card are less likely to remember details about its costs than people who pay for the same laptop with paper currency.

Finally, you don't need a scientist to tell you that getting a credit card means giving yourself the opportunity to buy something you can't afford. This is not necessarily a bad thing, but, for financially irresponsible people, it can have devastating consequences.

How to Apply for a Credit Card: 12 Steps (with Pictures)

5. Find information on the credit cards you're interested in applying for. Locate online applications or a hard copy of an application and look over the information on interest rates, grace periods, penalties, and rewards.

How to Apply for a Credit Card: 12 Steps (with Pictures)

6. Browser online reviews on customer service for the credit card(s) you are interested in. The abstract information credit card companies publish can be a lot different than the nitty-gritty stories told by people who have actually dealt with those credit card companies in real time.

How to Apply for a Credit Card: 12 Steps (with Pictures)

7. Check out rewards offered with different cards. As mentioned above, some credit cards come with miles that you can use on flights and other incentives. Some credit cards, however, give out reward points only after you spend a certain amount, making the deal a little less sweet.

According to the federal government, about 46% of American families carry credit card debt. Since people who sign up for rewards programs tend to spend more money than credit card users without rewards programs, it's probably best for individuals with high debt loads to stay away from rewards programs.

In any case, do not let the promise of rewards drive your spending. This is what the creditors count on, so don't fall into this spending mode.—Instead, consider the rewards as a bonus or surprise which may help to defray the cost of purchasing on credit. For example, if a credit card offers cash back rewards for gasoline purchases made using their card, it might make sense to use that credit card for all of your gasoline purchases, but not to change your spending habits. In the end, using this strategy, your gas purchase price will have been reduced.

Deciding on a Credit Card

How to Apply for a Credit Card: 12 Steps (with Pictures)

8. Check to see when payments are due. Some credit cards require you to pay in full; others allow payment bi-weekly and some are due monthly. Knowing when your payments are due will keep you from forgetting your due dates, which could in turn affect how much you pay and even your credit rating.

How to Apply for a Credit Card: 12 Steps (with Pictures)

9. Locate all the information needed to apply. Find what type of information to gather such as driver’s license number, social security number, work phone numbers, previous residence and referrals. Some credit cards only ask for a minimal amount of information such as a name and identification number, but others can have a more extensive application that would require more information from you.

How to Apply for a Credit Card: 12 Steps (with Pictures)

10. Think about how you would like to apply for a credit card. You can turn in your application a few different ways. How urgent is getting the credit card for you?

Decide if it is easier for you to apply online, by telephone, in person or with a copy of the application that you will send via the postal service. Some will offer an immediate decision such as online applications and in-person applications, while applications sent by mail can take weeks to process.

How to Apply for a Credit Card: 12 Steps (with Pictures)

11. Check that all the information you supply is accurate. Many people do not reflect over what they are filling in and submit their credit card application without checking the information that they have filled in. Always make sure that everything is accurate, otherwise your application may be rejected. This is one of the most common mistakes people make when it comes to submitting credit card applications.

How to Apply for a Credit Card: 12 Steps (with Pictures)

12. Treat your credit card like real money when you get it. Set constraints for using it, such as "I'll only use this credit card for gas, normal living expenses, and food," or "I'll only use this credit card to purchase plane tickets." Be responsible about your card and you'll do well; be irresponsible — missing payments, incurring fees, spending over your limit — and your credit card will start working against you.

If you can, pay off your debt as soon as you put it on your credit card. This will help your credit score, and will establish your creditworthiness in the eyes of the credit card companies. It's a good habit to establish anyway.

If possible, don't max out your credit cards. Keep a good balance-to-credit limit ratio on your cards.

Using more than 30% of available credit will likely trigger a credit score reduction which impacts your future ability to get more credit, say, to buy a house or a car. This means don't spend all your available money on your credit card.

If it makes sense, distribute some of the near-max debt to your other cards or pay it down with cash. If your other cards have a higher APR, you will have to decide which strategy benefits you most. Here, free credit counseling may help shape your actions.

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