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However, the five main areas you want to address before you apply for a credit card online are how your personal information is protected, the type of card, what charges are associated with the use of the credit card, which credit reporting bureaus the lender reports to, and when a decision will be made on your application for a credit card.
How Is My Personal Information Protected?
When you apply for credit card online offers, you want to make sure that the website you are using is reliable and uses technology to keep your information secure from hackers. This means that the website will use secure encryption technology, have firewalls installed, and use other precautions to keep your information safe. The website should also offer verification processes that ensure you are really who you say you are when applying. Often, legitimate companies will ask you to provide the dollar amount owed on a specific loan they can access using your credit report as verification. These protections are especially important when you apply for credit card promotions online because identity theft is increasingly on the rise, and the simplest way to get a new identity is by establishing lines of credit. This is why card-issuing companies should request information only you would know and that couldn’t be found in a public database. For example, asking about the specific dollar amount of a loan ending in 1234 that you hold is a much more secure way to identify you than simply asking for your prior address or telephone number, as those last two pieces of identification can usually be found in public databases anyone could locate, but your secure loan from another company is likely not public knowledge.
Is This A Secured Or Unsecured Credit Card?
You want to ask if the credit card is secured or unsecured. Unsecured credit is credit that has no collateral associated with it. With secured credit, you will have to make a deposit or offer other collateral for the credit you are requesting. If you apply for a business credit card, it is likely your card will be a secured card. You need to ask what amount of deposit is required, as well as how that deposit is used. If you have to deposit $300 into an account with the company, and they allow you to use only $100 of that amount as credit until you build a good payment history with them, that means the company has $200 of your money going unused although it may earn a very small amount of interest.
What Charges Are Associated With The Credit Card?
This is important whether you apply for a credit card that is secured or unsecured. You will want to know if there is an annual fee, and if so, what your anniversary date is, as it may not be the same date as when you applied for the card. You will also want to inquire about any monthly fees, balance transfer fees, or instant checking fees if this is a feature associated with your credit card. All these fees will reduce your available amount of credit on the card. Some cards out there will offer you $300 of credit. However, you have to make a $200 deposit, and there is an annual fee of $80. These accounts often have a monthly fee equaling approximately $10/month, but they may charge a full year's worth of monthly fees when they open your account. If so, that’s $120 in monthly fees and $80 in an annual fee, which totals $200, or the amount of your initial deposit. However, your $300 credit line will be reduced to $100 available for actual use, and your $200 stays on deposit as collateral. So, in essence you have laid out $400 worth of money in deposit and fees to use $100. This is if you paid off the fees in full on your first statement. If not, you’re incurring finance charges and potentially late or over limit fees. You would have been better off keeping your $200 deposit and using it instead. It is very important to know what fees are associated with your account and to understand how they will impact your available credit.
Do You Report To All Three Credit Bureaus?
The three main credit bureaus in the United States are Experian, TransUnion, and Equifax. If your credit card company reports to all three bureaus, this is in your best interest. It means that your credit history will go to all three and make your credit reports consistent. It also means if you have bad credit it will go to all three as well, so you’ll want to make sure that you make payments on time. Apply for credit card offers that report to all three bureaus to maximize your credit reporting results.
When Will A Decision Be Made On The Credit Application?
You might get a postcard in the mail that tells you to go online for instant credit approval. However, instant may mean seven to ten days if you have any credit blemishes. Make sure that you know the actual credit application timeframe so you aren’t disappointed. Many credit card offers online will reject or approve you within minutes. However, many will say that they do, but in fine print on the website you’ll see that the form page that tells you that you will be contacted within 7-10 business days via mail with a decision is what’s considered an instant result. Expect most legitimate online offers to take this time to approve or deny your credit card application unless your credit card is issued by the bank itself. For example, Chase has instant approval processes that will generate your approval within minutes, but this is because it is based on your checking and savings history with the bank. Most places have to access credit reports that are not always an instant process.
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