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What is a good first credit card?
Did you know that there are banks that specialize in extending Visa Credit Cards and MasterCard Credit Cards to individuals that are not currently using credit cards and need to establish a credit score? You can choose any bank to apply for a card but don't apply to more than one at a time, credit applications will show up on your credit report almost immediately, and remember that multiple rejections will make you look desperate for a credit card.
What is a prepaid debit card?
Prepaid debit cards are a good solution for anyone who does not want to be tied down to a banking institution, anyone wanting a more secure way to carry their money, or anyone having troubles being approved for a credit card.
Unlike credit cards, you do not incur any debt with prepaid debit cards, you do not need to worry about credit card payments, and you pay no interest charges. Prepaid debit cards do not require credit checks, so almost anyone 18 years or older will be instantly approved.
Funds are loaded into the prepaid debit card by the cardholder and the card can be used virtually anywhere that accepts credit cards, as long as the debit card carries the VisaŽ or MasterCardŽ logo. These types of cards are a great alternative to carrying a checkbook and can help cardholders learn how to budget and manage their money.
Many prepaid debit cards today report card history to major credit bureaus, so cardholders can build their credit using a prepaid debit card without the risk of damaging it along the way.
If your initial application does not land you a new credit card don`t fret, there are other options.
Try applying for a department store credit card or oil company credit card and build your credit that way. These cards are easier to obtain than Visa or MasterCard charge cards.
Also you can open a secured credit card, this will require you to deposit money nto an account with a credit card company and then they will provide a credit card to you. Your credit limit is usually equal to the amount of money you deposited into your account. There are fees associated with these cards so do your homework and read the fine print.
As soon as you establish a payment history will help you qualify down the road for the major credit cards. Apply to one, meaning either a department store or oil company, and see if you are approved. Wait a few months before applying for another card.
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We recommend that you carry a small balance on the department store card or secured card at all times. This shows the credit companies that you can handle an outstanding balance. Remember always, it is vital that you stay up to date with all your statements. Late payments, missed payments or other payment problems will undo all your efforts to build a credit history to the point where you have ready access to credit.
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