New credit cards are hitting the market at a dizzying pace these days. Over the last few months, I’ve researched and evaluated dozens of new credit cards to make sure that each of them is doing what they promise to do. But how do you know which ones to apply for? I decided to create a guide to help you out. Hopefully, it will save you the time and trouble of having to apply for credit cards, review them, and determine whether or not they work for you. Since the majority of credit card applications in my opinion are considered a waste of time, I’ve prepared this guide to help you figure out which ones are worth your time.
What is the required documentation?
Most banks will require you to submit a recent pay stub, tax returns, or a short version of your credit history (i.e., statement of account, credit reports, etc.). Some banks may also ask you to provide personal information such as your social security number.
If you have used credit cards before, you may be asked to submit a payment history. It’s a hassle to have to re-tell your payment history every time you apply for a card, so you’ll need to make sure that you’re adding up your transactions correctly.
If you’re applying for a mortgage, you may need to provide your credit score, which will help the bank determine whether or not they will consider you to be a good credit risk. For this, you’ll need to provide your bank account number, social security number, and the last 4 digits of your social security number.
What’s the process like?
Depending on your current bank, you may be offered a quick meeting with an employee who will review your application. Other banks are more thorough and may need you to fill out an application and complete a form. Make sure to keep your list of documents in a separate place so you can always refer to it.
After you submit your application, you’ll usually be notified within 24 hours or less. Some banks may call you or send you a mailer to follow up with you before they decide whether or not they want to accept your application.
If you’re applying for a prepaid credit card, you’ll usually be asked to send in your pay stubs or bank statements (depending on the card type) as well as some personal information such as your name, address, and date of birth.
Do I need to spend thousands of dollars to have a good credit score?
In general, your credit score should range between 700 and 800. While your credit score doesn’t indicate your creditworthiness by itself, it’s a key factor used by lenders to determine the maximum amount of money you can borrow. For example, you may be approved for a loan with a lower interest rate if you have a good credit score. To get a good credit score, you need to use as many lines of credit as possible.
If you only have one credit card, then you’re only using a few of your 20 available credit lines and thus lowering your credit score. But if you have multiple cards with different credit limits, then you’re using all of your available lines of credit which helps your credit score. The best part of having a credit card is that it gives you access to many different types of credit lines and lets you build your credit history.
The real question is, how do you get a good credit score?
The first thing you should do is get a copy of your credit report. You can obtain a free credit report from AnnualCreditReport.com or by requesting one from each of the three credit bureaus (Experian, Equifax, and TransUnion).
You should use the free credit report to look over your credit report and make sure that it’s accurate. Make sure that the accounts listed on your credit report (i.e., credit cards and personal loans) are yours. If you see that a loan or credit card that you don’t recognize is listed, you should contact the creditor.
It’s also important to check your credit score. While your credit score doesn’t indicate your creditworthiness by itself, it’s a key factor used by lenders to determine the maximum amount of money you can borrow. For example, you may be approved for a loan with a lower interest rate if you have a good credit score.
The best way to get a good credit score is to be responsible and pay your bills on time. For this, you’ll need a positive payment history on all of your accounts. If you’re struggling with credit cards, then a zero-balance balance transfer can be a great way to make a significant dent in your balance, but it won’t make much of a difference in your credit score.
Finally, be careful about the kinds of things you charge on your credit cards. Don’t charge the most expensive items or charge anything that you don’t expect to pay off. Don’t use the same card to pay for everything either. Have one bill be your primary payment account so you can be sure to make your minimum payments and pay down the balance in a timely fashion.
While you can manage your credit score by staying on top of your bills and payments, another way to boost your credit score is to apply for a credit card. Although you may have to spend a few thousand dollars to get a good credit score, it will likely lead to positive credit history. That will give you access to more credit cards and enable you to spend even more money, driving up your credit score even more.
Is it possible to buy a car without credit?
Yes, you can get a car loan without credit. However, you’ll have to put a large down payment on your car loan. And in some cases, you may have to pay an extra fee for the convenience of not having to wait for your credit to be approved before you can buy your car.
Another option is to go to a lender and apply for a loan with a secured credit card, which will help you build your credit history and also ensure that you pay the minimum due on your credit card monthly.
Take a car loan or secured credit card, get your car, and start paying it down. You should have your car paid off within about six months. This is the amount of time you should aim to pay down your car loan and secured credit card. If you miss a monthly payment, your car loan or credit card may go into collections and may lead to repossession of your car. But if you manage your credit carefully, you can avoid going into collections.
Another option is to borrow from your retirement savings plan. At the very least, try to keep your spending to a minimum. And you can always use your retirement plan money if you need to. There are also some things you can do to pad your income before your retirement. If you have a job you love, you may want to ask for a raise, because if you negotiate your salary for a job, you’ll have more money available.
If you’re looking for a second source of income, you could consider starting a side gig. This could help you bring in additional income and could lead to additional opportunities.
What can I do to lower my credit score?
In most cases, your credit score can’t be lowered much at all. The types of things that can lower credit scores are things you can’t control. Examples of these factors are:
- Bad payment history on your credit card. This will usually take a few years to clear up, so it’s best to catch up and start paying your balance down as soon as possible.
- Taking out a new loan. The fewer outstanding loans on your credit report, the better your credit score.
- Making a late payment on a loan will cause your account to go into collections. If you owe more than 50% of your credit limit, you should pay it in full at the end of the month.
- Using an all-cash offer instead of a loan. This is often referred to as cash and carry financing, and you’ll generally be able to get better rates and a lower rate than if you get a loan at your bank.
You should be able to improve your credit score by making on-time payments on all of your bills. And if you can pay more than the minimum balance on a credit card, you’ll want to do that, too. By making your payments on time, you can build your credit history and start earning some rewards.
How to manage your credit history?
Once you have some of your debts paid off, the next thing to do is start building your credit history. This will allow you to apply for credit cards, which is an easy way to bring in extra income, which can help to pay off your remaining debts.
There are a few things you can do to make sure your credit history remains positive. Your credit score can be lowered by paying too much for your credit cards, rent or mortgage, and other consumer debt. If you are building your credit history by having a roommate pay you rent, for example, you can’t just say, “Hey, I’m going to pay $500 extra,” and expect that you’ll get the same credit score as before.
Making payments on time also helps build a credit history. And sometimes, you can sign up for a credit monitoring service, such as Credit Sesame, and this will help keep you on top of your finances and your credit score. A credit monitoring service will send you emails with updates on your credit score and will let you know if there have been any major changes to your credit history.
What can I do to keep my credit score up?
There are a few ways to maintain a good credit score, but the best thing you can do is maintain a good credit score. If you see that your credit score is increasing, this could mean that you’re paying your bills on time and that you’re staying out of debt. Your credit score will also be determined by a few factors:
- Payment history: The most important factor in determining your credit score is how long you have been paying your bills on time. The higher your payment history, the higher your credit score will be.
- Amounts owed: Your credit score will also be influenced by the amount you owe, which is often referred to as your “credit utilization” ratio.
- Length of credit history: It’s important to have a long credit history and not owe more than 30 percent of the credit available to you.
- Credit mix: Credit scores can be affected by your credit mix, which refers to the number of types of credit you have, including student loans, credit cards, mortgages, and car loans.
While you may be able to repair your credit, you won’t have a high credit score right away. You will need to pay your bills on time, and sometimes that means your card will be declined. If this happens, you can’t use that card again until you pay the full balance. You should only make purchases for a limited amount of time, and it’s a good idea to limit yourself to using your credit card once a month or every two weeks. If you see that your credit score is falling, you’ll need to take some steps to improve it.