Monday, August 21, 2006

Credit Cards type

Types of credit card

Looking to get a credit card? Before you fill out a credit card application, you need to decide what type of credit card will work best for your specific situation. Here I am providing the listing from which you can choose.

Standard Credit Cards

  • Balance Transfer Credit Cards

  • Low Interest Credit Cards

Credit Cards with Rewards Programs

  • Airline Miles Credit Cards

  • Cash Back Credit Cards

  • Rewards Credit Cards

Credit Cards for Bad Credit

  • Secured Credit Cards

  • Prepaid Debit Cards

Specialty Credit Cards

  • Business Credit Cards

  • Student Credit Cards

Standard Credit Cards

Standard credit cards are the most typical type of credit cards. These are unsecured credit cards that are readily available from most banks and financial groups.

Balance Transfer Credit Cards

Balance Transfer Credit Cards are designed to allow consumers to transfer a higher interest credit card balance onto a credit card with a lower interest rate, thus saving them money in interest charges. For example, if you transfer a balance to a credit card with a low introductory APR of 0%, the APR for this balance will typically stay at this 0% interest level for a specified period of time, thus potentially saving the consumer hundreds of dollars in interest charges. The terms of balance transfer credit cards can vary between offers, so be sure to thoroughly read the terms and conditions for each specific card.

Low Interest Credit Cards

Low Interest Credit Cards offer either a low introductory APR that changes to a higher rate after a certain period of time or a low fixed rate APR. For example, you may get an introductory APR credit card with an interest rate of 5% for the first six months and 10% thereafter. Then, for the first six months, any purchases or balances you carry will be only charged a 5% annual interest rate. However, any new purchases or balances that carry over after the six-month period will now be subject to a 10% APR.

Many people take advantage introductory APRs to make larger purchases, so that they can take several months to pay them off. Low APR Credit Cards can help save consumers a lot of money on interest charges.

Credit Cards with Rewards Programs

Credit Cards with Rewards Programs usually "reward" the card holder incentives, rebates and even cashback rewards for purchases they make on their credit card. You can get additional airline miles, cashback rewards or discounts on merchandise for each dollar charged on such a card. Rewards Cards usually require better than average credit for approval.

Airline Mile Credit Cards

Put simply, airline mile credit cards or frequent flyer credit cards give you airline miles credits (or frequent flyer miles) whenever you use your card. Typically, you as the cardholder accumulate "points" based on the dollar amount of your credit card purchases over a period of time. Based on a predetermined point level, you can then redeem those points for airline travel (much like frequent flyer miles).

Cash Back Credit Cards

Cash back credit cards give you cash rewards for making purchases with the card. The more the card is used, the more cash rewards you usually get. Most cash back rates are around 1% of your total purchases, excluding interest and finance charges. However, some cards offer a higher cashback percentage with increased usage while still others offer a higher cash back percentage at select merchants or for particular types of purchases. Since cash back programs are costly to the credit card companies, some cash back credit cards also have an annual fee, which can vary from $50 to $100. This type of card is particularly good for people who are faithful about paying off their balances each month. If used appropriately a cash back credit card can earn the cardholder a significant amount of money over time.

Reward Credit Cards

Reward credit cards are similar to cash back cards in that you can accumulate points towards a reward structure, which is based on how much you use the card over a period of time. Credit cards offer different reward programs and promotional offers often change, so be sure to thoroughly look over the card’s terms and conditions of each specific card before applying.

Bad Credit and/or Credit Repair

Credit can easily go from good to bad with poor judgment, mismanagement of credit cards or simply a change in job or financial situation. This does not mean you cannot get a credit card. There are several options available for people who have had bad credit in the past and for those who are currently trying to repair their credit.

Depending on your specific situation, debt consolidation, use of introductory APRs on balance transfers or other options may be the best choice. However, if you still need credit or want to start repairing your credit by proof of action, there are several credit cards designed to help "rebuild" poor credit histories.

Secured Credit Cards

Secured credit cards require collateral for approval. With secured credit cards, a security deposit of a predetermined amount is needed in order to secure the credit card. Generally, the security deposit needs to be of equal or greater value to the credit amount. Collateral can come in the form of a car, a boat, jewelry, stocks or anything else of monetary value. Secured credit cards are for people with either no credit or poor credit who are trying to build or rebuild their credit history.

Prepaid Credit Cards

Prepaid cards are, in fact, not credit cards at all BUT rather are used just like credit cards, wherever credit cards are accepted. The advantages of prepaid cards is that there are no finance charges and they help you avoid debt, in that all purchases are paid for beforehand. With prepaid cards you determine the credit line. Generally speaking, a cardholder's credit line depends on how much money he/she transfers to the card. Therefore, there is little risk of running up credit card debt, while budgeting is made easier.

Specialty Credit Cards

Specialty credit cards are for individuals with unique and special needs for their credit use. Examples of these types of cardholders include business users and students. These credit card programs are designed specifically to meet the needs of these particular groups.

Business Credit Cards

Business credit cards are available for business owners and executives and have many of the same features as traditional credit cards: low introductory rates, cashback rewards, airline rewards, etc. However, business credit cards can also have many additional benefits in comparison to traditional credit cards.

Student Credit Cards

Students generally have little or no credit history. Because of this quandary, students may often find it difficult to get approved for a traditional credit card. Luckily, student credit cards do exist. This type of credit card is set up to help students build up the credit history that most of them don't already have.

Student credit cards are often scaled back in terms of rewards, features and other benefits, but they can still be a valuable commodity. If used wisely, a student can take the first step towards building a solid credit history with a student credit card.


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Dan Garriott said...

best credit card airline

I’m looking for a credit card that rewards airline miles and I was wounding if you would give me your recommendation.

I don’t mind paying an annual fee
I pay my cards off every month so the APR is not an issue
I want the most miles I can get.
I want no black outs and I want to use any airline

Let me know what you would recommend.


gasoline credit cards said...

Hi Dan.

Try one of these credit cards:
The Chase Travel Plus Platinum Visa
The Discover Miles Card.

Or you might want to consider a gas rebate credit card.

Joshuathomas said...

The best card for your unique circumstances, get it Discover student clear card here.

YourSimplerLife said...

I'm not sure if you've ever considered Credit cards for people with bad credit but it can help!

Williamethan said...

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