Kids are now being supplied with every thing at an earlier age, including mobile phones, laptops and televisions, so why not a credit card? Well, apart from the legal problems, most kids clearly aren’t mature enough to handle a credit card, but when should a person apply for their very first credit card? Generally speaking, if somebody can handle monthly costs, he can apply for a credit card. As keen as you might be to get your very first card, many credit card businesses aren’t so keen to offer you one. Rather than placing in several credit card applications, target just a few businesses that are known for offering credit cards to first-timers.
When you obtain a constant job that delivers a reliable income, obtaining a credit card becomes a more realistic and sensible choice. Many credit card companies want to be able to see that you’re employed before approving you to get a card. It’s fundamental risk management. Some banks will grant you a credit card if you do not have work, although that generally applies to students only. There’s absolutely no point in attempting to secure a card if you do not have a job, for if you do not have a stable income, you can not pay off the card bill (or other bills for that matter, like loans and mortgages). If you can not pay off the bill, you fall in to debt and a number of issues will follow, including credit damage and non stop calls from the credit card company.
Waiting to apply for a credit card till you possess a great credit rating allows you to qualify for a much better interest rate. Lendingtree.com states that a credit rating below 620 is generally considered sub-prime, meaning you won’t be eligible for the very best rates. Once your credit score rises above 620, credit card firms start to feel much more comfortable with the idea of granting you for a lower interest rate. Indexcreditcards.com states that the common credit card interest rate is 16.89 percent at the time of February. 15, 2013. You are able to raise your credit by paying bad credit loan and lease payments on time.
First time credit card users might find themselves using their credit card too frequently and accumulating costs they aren’t able to pay back. A secured card limits the sum you can charge towards the sum of funds you utilize as security. Some banks offer secured credit cards as a means to construct or restore credit scores. Once you apply for a secured card, you must deposit a minimal quantity of money into your savings account; the amount varies from bank to bank. That money functions as the maximum credit limit for your secured card. If you do not pay your monthly bill, the lender can recover its funds by getting it from the savings.
When you do obtain your first credit card, you might be ignorant of a few tips and strategies that can enhance your credit scores. Keep your credit card account open, never charge more than 30 percent of the maximum credit limit and keep tabs on how much you owe. Your credit score is based partly on your credit background; shutting down an account deletes a portion of this background. Your credit score also diminishes or boosts according to the total of credit you use. Charging 30 percent or less of the maximum credit limit can boost your score, as stated by Money.MSN.com. Lastly, keeping an eye on how much you’ve spent enables you to arrange your finances and ensure you have enough cash to cover your monthly bill.