Guide To Comparing Credit Cards


Quick Reference Guide to Comparing Credit Cards

We need to start by segmenting credit cards into 2 groups:

Credit cards for bad and fair credit
If any of the following apply to you, chances are you fall into this group.

  • You have a credit score below 675 (Unsure, click here)
  • Have had a bankruptcy in the past 7 years
  • You were recently involved in a short sale or foreclosure
  • You are currently over 90 days late on a loan payment

Comparing and Selecting the right card if you have bad credit
First, it’s important to note that most cards for bad credit are not credit cards at all. There are debit cards, secured credit cards and credit cards for bad credit.

Debit Cards
Debit cards function very similar to a check card. They need to be loaded with funds and you cannot withdraw more money than you have in your account. These cards are great for making purchases and paying bills. Some even have credit building features and donate a portion of the funds you deposit to charity. When selecting a debit card, you should pay close attention to fees associated with using or loading funds to your card.

Secured Credit Cards
Secured credit cards extend you credit but you must collateralize the credit you receive by depositing funds into your account. These cards usually report to major credit bureaus and are great for building credit if you make on time monthly payments. You should pay close attention to fees and interest rates. These cards are a great stepping stone to a credit card.

Credit Cards for Bad Credit
Credit cards for bad credit are real honest to goodness credit cards. In other words, they extend you credit that is not collateralized. The credit limits are generally very low and the interest rates are very high. These cards do report to credit bureaus and are great for building credit if used responsibly. It is essential that you make note of any upfront fees, interest rates and penalties before signing up for a credit card for bad credit.

 

Credit cards for Good Credit
If any of the following apply to you, chances are you fall into this group.

  • You have a credit score above 675 (Unsure, click here)
  • You have a consistent record of paying your bills on time
  • You have a long credit history and are not currently late on any of your loans

Comparing and Selecting Credit Cards for Good Credit
If you have good credit, you are in the driver’s seat when comparing and selecting a credit card….and you’ve earned it! There are many, many options available to you when you have good credit and are looking for the right credit card.

Interest Rates
First and foremost, you should look at the interest rate including the default rate if you are late on a payment. A lower interest rate will result in lower monthly payments if you carry any debt. Be very weary of the default interest rate. Some credit cards may default to a very high interest rate if you are ever late on your payment. This is particularly a problem if you are carrying a large amount of debt on your credit card.

Fees and Penalties
You should always read the fine print to make yourself aware of any fees and or penalties associated with your credit card. Some cards carry annual or upfront fees. Other credit cards have no fees unless you are assessed a penalty for overdraft or late payment. Some cards will waive late payment fees if you have used the card in the past 30 days, but will still raise your interest rate to the default rate. This is often a source of extreme headaches for consumers.

Rewards
Many cards offer rewards for usage. These rewards can include everything from air miles to cash back to discounts on goods and services. For responsible credit card carriers, rewards credit cards can be worth their weight in gold. Just be sure that you don’t carry too large a balance and you will come out ahead.

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UNSECURED CARDS FOR BAD CREDIT These credit cards are designed for people with less than perfect credit. If you make on-time minimum payments and maintain your balances under the credit limits, you may be able to build, rebuild, or reestablish your credit. Although approval is not guaranteed, approval is more likely with one of these cards. Search cards for poor credit in sponsored listings.

SECURED CREDIT CARDS Secured credit cards are a terrific option for establishing or rebuilding your credit history. Generally accepted wherever major credit cards are accepted, secured cards are easy to get, even if you have bad credit or no credit history. Making your payments on time will help to build a positive credit reference. Search secured credit cards in sponsored listings now.

PREPAID & DEBIT CARDS Prepaid and debit cards offer the convenience of a card without the hurdle of a credit check. These cards are ideal for making daily purchases because they are debited directly from your account. These cards are generally guaranteed approval and are very similar in nature to a traditional checking account. Search prepaid credit cards in sponsored listings now.

READ: OUR GUIDE TO GOOD CREDIT READ: OUR QUICK REFERENCE GUIDE TO COMPARING CREDIT CARDS

ADVERTISING DISCLOSURE The credit card offers that appear on the website are from credit card companies from which CreditCardChest.com receives compensation and CreditCardChest.com does not include all credit card companies or all available credit card offers.

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