Online Credit Card Application Tips

Processing a credit card application online has slightly different procedures from applying for a card through regular means. While most of the differences are relatively minor, you should still keep the differences in mind when making an online application. Like knowing the differences between a walk-in job application and simply sending your resume through email, paying attention to the small details can make the difference between approval and rejection.

The first difference is time. Most credit card providers are only starting up their online application procedures. So, while in theory online applications are supposed to be processed faster, due to the fact that it's a relatively new program most companies will take as much or even more time to get your application processed. Be patient.

There are two exceptions to this rule. The first exception is the largest credit card companies, who have the financial means to support online applications with sufficient equipment and personnel. The second exception to the rule involves relatively new credit card providers who have set their initial operations up with the latest technology in mind, so their online application procedures will be up to date and an integral part of their companies from the get go.

The second difference is in the fees for application. Most companies will offer different charges for online applications as opposed to regular applications. When applying online, be sure to read the details given to make sure that you are aware of the charges involved and can weigh your options. Also, the interest rates and transaction fees may slightly differ for credit cards obtained through online applications.

The third difference is in Card Selection. While more and more companies are taking advantage of online application for their customers, due to it's limitations not every type of credit card or certain features can be obtained through online application. Some examples are credit card classes with much higher credit limits, and some types of dual role debit-credit cards. Because of this restriction, you should review all the options given by your prospective credit card provider and find out if you can apply online for the type of card you want.

Lastly, one area you should look into is your credit history. If you have a good credit history you should be fine. If it's not, you should know that some credit card companies will automatically disapprove online applications made by people with bad credit ratings. While a lot of credit card companies allow concessions for people with bad credit history, the option of applying online is usually reserved for those with clean records. If you've got a bad record and still want a credit card, then more often than not you'll have to inquire in person.

One seeming exception to this rule is that some credit card providers will actually provide credit cards with NO background credit checks, AND will let you apply online! This may seem like an ideal scenario for people with bad credit histories. However, pay very close attention to the fine print and other stipulations when applying for that credit card, because there's likely going to be a catch somewhere. The catch will usually involve huge interest rates or larger than average charges for delayed payments - which pretty much just takes advantage of you if you fall into the same financial pattern that got you bad credit in the first place. If it seems too good to be true, it most likely is.

Top 5 Myths About Credit Card Sign Up Bonuses

A credit card is just a credit card until you take all those flashy sign-up bonuses into account. Bonuses add new meaning to earning rewards. Consumers can't wait to get them and credit card companies use them to differentiate their offerings.

Creditors claim to have it all; except debt repayment plans and reduced interest rates. They promise vacation getaways and large bonus cheques, but those rewards come with strings attached. Sign-up bonuses are just their newest ploy to get you to spend more money.

Once you're lured by the potential rewards, creditors hope that you'll carry over your balance and forget to cash in your bonus so they could slap you with high interest charges.

Fortunately, you can beat the system and capitalize on sign-up bonuses. It all starts with separating fact from fiction. So here are the top five myths surrounding credit card sign-up bonuses.

You're getting something for nothing

Credit card companies spend a lot of money to earn your business. But the money they spend to offer those great sign-up bonuses are not acts of generosity; they'll cost someone in the long run. It's up to you to determine who pays.

For instance, there are spending requirements that you have to meet before you receive the bonus. If you rack up debt and carry over the balance, you'll be forced to pay high interest charges. Depending on your balance and rate, your interest charges will pretty much exceed the cost of any bonus you receive. The only way you'll get something for nothing is to meet the spending requirements without going into debt and paying interest charges.

Applying for credit card hurts your credit score

Several factors are considered in the calculation of your credit score. A credit card helps your score by building your credit history and decreasing your credit utilization (debt to credit ratio). Some financial experts recommend that consumers carry at least six credit cards in order to build a stable financial profile. But since opening many cards in a short time can hurt your score, it's best to apply for the cards over time, and certainly not before you apply for a mortgage.

Keep your credit card debt to a minimum and pay your bills on time. Those factors are way more valuable than having too many credit cards.

You'll be stuck paying annual fees

Expect to pay an annual fee of £35-£95 for your rewards credit card. The good news is that most creditors waive the fee for the first year. This will give you the chance to claim the bonuses without extra charges - you can cancel the card just before the next year's fee becomes due. Alternatively, you can ask your provider to waive the annual fee. They may be willing to consider your request if you've been a responsible cardholder.

When comparing rewards credit cards, look for cards with no annual fees or cards where the benefits exceed the cost of the fee. It's the only way to ensure that your bonus points are truly rewarding.

The process is too complicated

Applying for a rewards credit card and earning bonus points couldn't be any easier. The Internet simplifies the process and places all the tools at your fingertips. Use consumer focused comparison sites to compare offers and find the best deals. Most sites provide details of the card's terms and conditions, so you can evaluate the terms and submit your application online.

Activate the card, meet the spending requirements and wait for your bonuses. Don't forget to pay off your balance, and decide how and when you'll use the card in future.

Sign-up bonuses are for everyone

Sign-up bonuses are fantastic, but they're not for everyone. If you're paying interest on credit card debt, your focus should be on paying off your debt, not on earning rewards from another card. Pay off your debt and reward your efforts with sign-up bonuses after you've cleared your balance.

Make credit cards work for you

Credit cards are powerful but complex financial tools, and you shouldn't fall victim to popular myths when you're making a crucial financial decision.

Understand the myths, use trusted sources to learn the truth, and make reward sign-up bonuses work for you.