Apply For A Credit Card Online Or Visit A Branch
If you are looking for a credit card then you must be thinking whether to call your banks representative and visit the branch or directly apply it online. So here you can see the advantages of both the situation and after going through it you can make your decision.
Include All Income In The Application
Issuers consider your credit scores an indicator of creditworthiness, but scores dont reflect your income. Card issuers use income to calculate your debt-to-income ratio, which helps determine your ability to make payments. Change your ratio by either increasing income or decreasing debt.
If you earn money outside your full-time job, include it on your application. As long as youre 21 or older, you can include your household income, including income from your spouse or partner, on your credit card application.
Resist the temptation to overstate your income. If an issuer finds that you knowingly provided false information on your application, you could be charged and convicted of credit card fraud.
Being unemployed doesnt automatically disqualify you from getting a credit card.
What Is A Debt Collection Lawsuit
When you fail to pay your credit card debt, the company may file a debt collection lawsuit seeking payment. If your , you have a short time to file a response to the lawsuit. If you ignore the credit card lawsuit, the company will file a motion asking the judge for a default judgment. The default judgment states that you owe the credit card debt. In most cases, the judge allows the credit card company to add attorney fees and other costs to the debt you owe.
The default judgment is recorded at your local county courthouse. The judgment accrues interest until it is paid in full. In most states, the judgment also attaches to any real estate that you own or purchase after the judgment is entered via a lien. If you sell your property, you must pay the judgment in full from the proceeds of the sale.
Actions a Creditor May Take After Getting a Judgment
State laws determine the legal steps a credit card company may take to collect a judgment debt. In some states, creditors are allowed to garnish your wages for judgments. Some states also allow judgment holders to apply for supplemental proceedings to identify any personal property the judgment holder may seize to satisfy the debt.
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Other Requirements To Get A Credit Card
There are some basic prerequisites to qualify for a credit card. The requires an applicant to be at least 21 to apply for a credit card, unless they are at least 18 with proof of independent income. Lenders are required by the CARD Act to consider your ability to make the minimum payments on any credit line issued to you, so youll have to show an income source in order to get approved for credit.
Most, but not all, U.S. lenders require that cardholders are either a U.S. citizen or are authorized to work in the U.S. and require a valid mailing address as part of the identity verification process.
Td Aeroplan Visa Infinite*
If you tend to fly Air Canada when you can, then the TD Aeroplan Visa Infinite could be the credit card for you. This Visa gives you, and up to eight guests flying on the same itinerary, free checked bags on your Air Canada flights. And when booking, as an Aeroplan credit cardholder, you get preferred pricing , too.
We bet you want to know about the newly revamped Aeroplan plan, too: The earn rate for the card is 1.5 Aeroplan points per $1 spent on gas and groceries. And 1 Aeroplan point per $1 spent on all other purchases. This is a respectable earn rate, since groceries and gas are typically what people spend the most of their money on. You also get great travel insurance, mobile device insurance, purchase security, extended warranty and a Nexus rebate of up to $125.
- Annual fee: $139
- Welcome bonus: Earn up to 25,000 Aeroplan points . Get 10,000 points for having the card and another 15,000 when you spend $1,000 in the first 90 days. Apply by March 6, 2022. Quebec residents, .
- Earn rate: 1.5 Aeroplan points per $1 spent on gas and groceries, 1 Aeroplan point per $1 spent on everything else
- Our favourite features: Free checked bags and Buddy Pass with Air Canada
- Additional benefits: Travel insurance, mobile device insurance, up to $125 Nexus rebate every 48 months
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Cons Of Sharing A Credit Card Account
Disadvantages of sharing an account with your spouse include:
- You could damage both your credit score and your relationship if your spouse spends irresponsibly. Whether you have them as an authorized user or you’re sharing a joint account, their financial habits have the potential to affect your credit history.
- Depending on how much your spouse spends and how high your credit limit is, you could hurt your score by increasing your . Your credit utilization ratio is the money you owe on your credit cards, divided by your total credit card limit.
How Does My Credit Score Impact The Credit Card Application Process
Your credit score is an indicator of your credit risk. Your credit risk shows how likely you are to make your credit card payments on time.
A strong credit score can improve your chances of getting approved for a credit card because it shows creditors you can use your credit card responsibly. Having a low credit score means you might be approved for a credit card, but with a lower credit limit.
Your credit history directly impacts your credit score. Your credit history includes a record of transactions, and lists the types of credit you have like credit cards or loans. Your credit history will also show your payment history, including your on-time payments, late payments or missed payments.
Learn more about your credit score and ways to raise it.
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What Is A Student Credit Card
Student credit cards often feature low income requirements, no annual fees, and are geared to those who are applying for their first-ever credit card and looking to establish a credit history. While many student credit cards donât provide rewards, some of the best student credit cards in Canada do, offering students the ability to rack up savings in the form of cash back or points.
Look For A Retail Credit Card
Retail, or store, credit cards are designed to offer frequent shoppers rewards or discounts for spending money at a specific store. Unlike student credit cards, a retail credit card can only be used at the store its opened under. Retail credit cards tend to have more relaxed approval standards than other traditional credit cards because stores benefit from increased consumer spending. If you do a lot of spending in one place, a retail credit card can be a good way to start building your credit with purchases you were already going to make. You could earn discounts or rewards, as well.
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Should You Carry A Credit Card For Emergencies
It would be best if you didnt have to use a credit card for an emergencyand instead had enough money in a liquid account, such as a savings account, to use in such a situation. However, if you are away from home while on vacation and dont have the ready cash to cover a car repair or some other unexpected expense, then a credit card can definitely come to the rescue. Other situations, such as an unexpected medical bill or a job loss, can often drain any emergency savings. Having at least two or three credit cards can be a useful thing in times of crisis. Ideally, these cards should have no annual fee, a relatively high credit limit, and a low interest rate. However, if you turn to credit cards when youve lost income, exercise extreme caution so that you dont take on unmanageable amounts of credit card debt.
What You Need In Your First Credit Card
If you have no credit history, you’ll want to look for certain credit card features to help you build your credit and manage your spending.
You’ll want a card with no annual fee, for example, so you don’t have to pay any money out of pocket just for carrying the card. Additionally, you may want to make sure your credit card issuer reports to all three credit bureaus. This way, you can build credit history across the board and improve your chance of getting future cards and loans. Not all issuers report to all three credit bureaus, so if you find a card that works for you but doesn’t report to all three bureaus, that is okay.
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Practice Healthy Credit Score Habits
For FICO score calculations, two factors, in particular, carry the most weight: payment history and credit utilization.
You can avoid that scenario by making your payments on time every month. If you struggle to manage due dates, automating payments from your bank account can simplify the bill payment process. Alternately, you could set up alerts through your bank or with your billers to let you know when a due date is approaching.
If you already have one or more credit cards, maintaining low balances can also help your score. Most lenders like to see your credit utilization number at 30% or below, Pearson says.
Paying down your current balances can improve your utilization ratio.
Another option is requesting a credit limit increase on your cards. By increasing your available credit limit, you improve your utilization ratio, assuming you dont make any new purchases against the higher limit.
How To Apply For A Credit Card
Choosing the right card may be difficult, but applying for the card youve chosen is easy. Most cards can be applied for online, although you can go to the issuing bank and apply in person or call them on the phone.
The card application will typically ask for the following personal information:
Name: Your legal name is required
Social Security or ITIN number: This is needed to perform the hard credit pull and is often the most important factor in determining whether youll be approved. There are some credit cards that wont perform a credit check, but those are an uncommon exception
Address: You must have a valid U.S. address
Income: This will help the issuer determine how much of a credit line you can afford
Housing Costs: This fixed cost, along with your income, will help the issuer determine how much credit to extend to you relative to what you can afford to pay back
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Also Consider: Scotiabank Gold American Express*
The Scotiabank Gold American Express has been a longtime favourite for Canadians, especially those who travel. The first thing youll notice about this card is the Scotia Rewards earn rate is a very healthy 5 points per $1 on groceries, dining and entertainment. Gas gets 3 points per $1, as do spends in two other categories: Public transit and eligible streaming services. All other purchases earn you 1 point per $1 spent. This card also doesnt charge a foreign transaction feeits one of the very few Canadian cards to offer this perk. Consider it a 2.5% bonus on all foreign currency transactions, including online purchases.
- Annual fee: $120
- Welcome offer: You can earn up to 40,000 Scene and travel points by spending $1,000 in everyday purchases in the first 3 months. You can also earn an additional 20,000 points when you spend $7,500 in everyday purchases in your first year. Apply by January 1 2022.
- Earn rate: 5 points per $1 spent on groceries, dining and entertainment 3 points per $1 on gas, public transit and eligible streaming services and 1 point per $1 on all other purchases
- Income requirement: $12,000
When Applying For A Credit Card Makes Sense
Applying for a second credit card may be worth considering if you want to raise your credit score. After all, opening another credit card account will automatically lower your . That factor accounts for 30% of your FICO® score. And as long as you make on-time payments across all of your accounts, getting another credit card could improve your credit.
Filling out another credit card application could also make sense if you have a high credit score and a good track record with your current card issuers. An additional credit card could give you access to benefits, including better rewards, lower interest rates and a higher credit limit. And if you know you can handle having another credit card, you might as well go for it.
Opening another account could improve your credit mix, too. Only 10% of your FICO® score depends on the types of credit accounts you have. But if youre determined to raise your credit score as much as possible, it doesnt hurt to have a variety of accounts.
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What Is The Best First Credit Card In Canada
The best first credit card depends on your needs, but for students and young adults alike the goal is to build credit, not necessarily to earn points or cashback. So, the Home Trust Secured Visa may be your best option. A good credit score means gives you access to better financial products as you move forward in life. That means, better credit cards with great rewards, low mortgage rates, and cheaper car insurance and auto loans.
How Your Parents Can Help You Get A Credit Card
Most students dont have much of a credit history. But building credit is a helpful step towards qualifying for that first card. Luckily, many credit card issuers give parents the option to add their child as an authorized user.
Having your parents add you as an authorized user on their credit card is a great opportunity to help your credit score when used responsibly* so eventually, you can apply for your own credit card. Its also a smart way to learn how to manage your spending and avoid credit card debt, which is when you carry a balance on the card month to month rather than paying it off in full. When you do that, the downside is you have to pay interest. While that may not seem like a big deal, those charges can add up over time. With that in mind, theres another caveat: You need to make sure you use your parents card wisely. Overspending and getting into credit card debt wont do you, or your parents, any good when it comes to building and maintaining a solid credit history. That said, becoming an authorized user on your parents card is a great way to learn about credit limits and using credit cards responsibly. Sure, you may not think you need a great credit score when youre in your late teens and early 20s. But the sooner you start building your credit history and learning good habits by using credit cards responsibly, the easier time youll have getting better credit offers for loans, mortgages, and car leases when youre older.
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Applying For A Credit Card In Person Reader Mistake Story
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We often publish stories from readers that illustrate how points and miles can help you get where you want to go. However, its important to learn from our mistakes as well as our successes, so Im calling on you to send us your most epic travel failure stories. Email them to and put Reader Mistake Story in the subject line. Tell us how things went wrong, and how you made them right. Offer any wisdom you gained from the experience, and explain what the rest of us can do to avoid the same pitfalls. If we publish your story, well send you a gift to help jump-start your next adventure!
Today, I want to share a story from TPG reader Anthony, who missed out on a sign-up bonus by applying in person rather than online. Heres what he had to say:
After spending a lot of time reviewing card offers, I decided the best fit for my needs would be the new Bank of America® Premium Rewards® credit card. I do a significant amount of business with them, so I qualify for the highest bonus level in the Preferred Rewards program.
Featured image courtesy of Bank of America.
Include All Sources Of Income
One common mistake people make when applying for a credit card is understating their income by not including all qualifying sources. In 2013, the Consumer Financial Protection Bureau issued an amendment to the CARD Act to specifically allow you to include all household income that you have a reasonable expectation of access to. The primary reason for this rule was to ensure non-working spouses and domestic partners equal access to credit.
In addition, be sure to include other eligible sources of income such as alimony, child support, disability benefits, investment income and disbursement of retirement savings.
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