Everything About Credit Cards

Credit card issuers set up tables on college campuses to entice passers-by to sign up for student credit cards in exchange for stuffed animals, pizza coupons, CD’s, and other gifts. The urgency to “fill this out right now” discourages these students from reading the fine print, so they sometimes have an annual fee charge on their account before the card even arrives.

With high interest rates and high credit lines, many students find themselves deep in debt to credit card companies long before they enter the job market.

Some of that is about to change.

Under the Credit Cardholder’s Bill of rights Act of 2009, credit card issuers will have a few rules to follow regarding student credit cards.

First, they will, in most cases, be prohibited from extending credit to any person under the age of 18. (If a parent or guardian is the primary account holder, they can still carry a card in their own names.)

Creditors will be prohibited from opening a student credit card account for any student who doesn’t have a verifiable income – or if they already have a credit card account with that company or any of its affiliates.

If the student does have a verifiable annual income, the maximum credit extended cannot exceed 20% of annual gross income, or $500. The maximum for all credit card accounts may not exceed 30% of gross income. This rule can be waived if the student has an approved co-signer.

Since the interest rates and annual fees for student credit cards varies from one issuer to the next, parents and students should do the research and choose the correct card. Responding to a solicitation in the mail or filling out an application in order to get a free gift can lead to a credit card with undesirable fees and interest rates.

But there’s good news on that score too. Should your child sign up for a student credit card only to find that owning it is not in their best interests, they can cancel the card within 45 days. The card issuer will be required to report cancellation to the credit bureaus – freeing up the student to obtain a better card.

You’re out of it – home free – right?

No, wrong. If you both signed the application forms for credit cards, if you both signed for the purchase of that car, or installation of that TV satellite, or that home mortgage, you’re both on the contract and you’re both liable.

Credit issuers don’t care what a judge says about who is responsible. When you signed the application or the agreement, they treated you as an individual person, and they still consider you an individual person – one who owes them money.

If the judge decreed that one of you must pay a debt and you don’t do it, the other can haul you back into court for more proceedings. But in the meantime, the creditors want to be paid. When they aren’t paid, the report goes to the credit bureaus, and both you and your spouse will see your credit scores decline.

So what can you do? If you can deal with each other in a civil manner, you can divide your debt. You can each get new credit cards, in your name only, and transfer the appropriate portion of your old balances to your new cards.

If you were listed only as an authorized user, your spouse’s debt will not be your responsibility, but it will still show up on your credit report. If that’s the case, ask your spouse to remove your name. If he or she does not, and it shows up on your credit report anyway, you can contact the credit bureaus and let them know that this is not your account. You’ll probably have to file a dispute, but you can get it off your report.

Because you are responsible for any accounts you hold jointly with anyone – be it your spouse, your child, your sibling, your parent, or even a friend – you should think twice before entering such an agreement.

And, if you are about to marry a person whose outlook on financial responsibility is different from your own, you should take care not to be added as a joint card holder, or even an authorized user. Get your own cards, in your own name. Consider these same consequences when you decide to purchase a car or a home.

As long as you don’t mix your finances, one of you can still maintain a good credit rating, even if the other does not. That could be beneficial to you as a couple – and will definitely be beneficial should you divorce.

First, investigate your alternatives. Read all the fine print in the offer you received, even if you need a magnifying glass to do so!

Then, considering what kind of credit card you need or want, click the links on this page to compare the cards available to you.

Once upon a time, credit cards were all pretty much alike, but no more.

If you’re looking for a rewards card, you can choose from a wide variety – getting back cash, merchandise, or airline miles. And each offers their own version of when you’ll be rewarded.

Some will give you a rebate for every purchase. Others will reward you for buying gasoline or eating out or using an airline. Student rewards cards often focus on book store purchases, pizzas, video rentals, or movies.

So first decide what you want and how you’ll use the card. Choose the one that will reward you for the most frequent use.

If you’re looking for an “emergency” card to use after you’ve had credit problems, choose the one that costs the least in annual or monthly fees. If you’re trying to rebuild your credit, you aren’t going to be using it often or carrying a balance, so the annual percentage rate isn’t as important to you. But some “poor credit” cards charge a fee each month even when you don’t use them. Again, read and compare to get what’s best for your own situation.

When your credit scores are high, you can probably choose any card you want, so consider how you’ll use the card. If you think you’ll need to carry a balance, go for the card with the lowest annual percentage rate – and check the fine print to see how long that rate is guaranteed. If you’ll pay the balance in full each month, then search for a card with the greatest rewards.

You can actually make money using your credit card if you get cash rewards and pay the balance each month – as long as you aren’t paying an annual or monthly fee to carry the card.

You’ve come to the right place to make comparisons, so start searching for your perfect credit card right now!

Credit card companies are working to entice their favorite kind of customers: those who carry a balance of $5,000 or so, run it up occasionally, and then pay it back down. That keeps interest payments coming in regularly without exposing the card issuer to too much risk.

To keep these customers happy, and to gain more like them, credit card companies have been using rewards programs. Now they’re offering savings plans as well.

Some cards automatically deposit a percentage of your monthly usage into a savings account. Other, such as Discover, offer rewards for paying down your debt.

Under one of their programs, customers who make 6 on-time payments in a row are rewarded with cash back in an amount equal to the next month’s interest.

Not surprisingly, polls taken on behalf of the credit card industry show that up to 75% of all consumers prefer cash back to merchandise, hotel discounts, or airline miles.
The new cash back offerings are an attempt to establish customer loyalty by giving them what they want on a consistent basis.

So how can the credit card help me get out of debt?

First, choose a card with no annual fee, a reasonably low interest rate, and cash back on all your purchases.

Next, ask for a credit line equal to at least twice the dollars you intend to spend monthly. This is to keep your debt to available credit ratio down. If you can, that will allow you to charge all your monthly expenses without going beyond 30% of your available credit.

Now, use that card, or a combination of cards, for all of the purchases you would normally pay by cash or check. This includes gasoline, groceries, drug store purchases, clothing, etc.

Next is the tough part: Resist the urge to let a balance ride. Pay that bill in full, on time, each and every month. Remember, you won’t have been spending any money out of your checkbook aside from things that can’t go on the card – such as your mortgage.

If your monthly bills total $2,000 and you get 1% back, that’s $20 extra that you can apply to your mortgage or your car loan – or to some other credit card that you need to pay down.