There are thousands of credit cards in the market, and all are issued for different services. How to choose the best credit card for you which is important? Here some determining factors that you look at while researching a credit card:
The first thing that you need to consider is your credit score since banks issuing credit cards offer you their products based on your creditworthiness. If your credit score, for instance, is above 690 which means you are an excellent customer, you have a chance to get the best rewards credit card helping you to save money thanks to low interests that they give to you. On the other hand, if you are those who have bad credits, you can get credit cards which only help you to improve your credit score. Unfortunately, bad credits approval for a rewards credit card is out of the question. Thus, before applying for a credit card, you need to check your credit score and learn which range you are on.
APR and Interest Rates
APR (Annual Percentage Rate) varies between different issuers. You need to compare all credit cards that you can get to find the cheapest one to save more money. In addition, introductory interest rates are significant to start off paying low interest. Generally, credit cards that are issued for those with good and excellent credits do not demand APR on credit card purchases and balance transfers, for instance, within the first six or fifteen months after opening the account.
Some credit cards may charge a fee for some transactions such as late payment and foreign transaction. While the rate of late payment varies from issuer to issuer, transactions fees are about one to three percent. Moreover, many credit cards require an annual fee, and it can be high in the rewards cards (approximately $90). However, you should know that most of them want cardholders to start paying the annual fee in the second year.
Most of the credit cards offer rewards in the form of points, miles or cash back. What is important here is to learn that which credit card gives you an opportunity to save money more and look at their redemption options. Almost all credit cards offer to earn 1% cash back on all purchases. Besides it, rewards credit cards generally offer 2% cash back on specific purchases such as gas station, grocery stores, and airlines. For instance, if you are traveling so much or staying at the hotel, preferring a travel credit cards will be the best for you. Redemption also is here the best way to save more money, since the points or miles that you earn on purchases can be used for certain expenses. The best credit cards will often provide you with flexibility for the rewards program, and they will offer you a sign-up bonus to earn miles, point or cash within the first three months if you purchase the amount that they demand. (for instance, at least $3000 on purchases can give you $500 cash bonus)
Except for miles and points, there are several services that issuers offer you. First of all, many issuers provide you to check your account 24/7 with online banking, and to regulate your payment due date which is best for you. They also offer you to get access to your credit score and limited data of your credit report for free. In addition, most of the issuers do not charge a fee for liability, if your card is stolen or lost.
Researching the best credit cards options for you may seem difficult but learning your credit score firstly will minimize the number of credit cards that you can apply. You should also know that applying for a credit card more than one at the same time or not being approved for the credit card will affect your credit score negatively.