Read the fine print regarding the terms of any card you apply for. Some of them are flat predators.
As an example, my daughter got a pre-approved application in the mail for a $500 card from somewhere. She started filling out the short application. I asked her if I could read the back of what she was applying for. I was shocked. Out of the initial credit line, they were going to immediately charge her:
1. $129 account set up fee (one time)
2. $99 one time processing fee.
3. $125 annual fee, billed over 12 mos.
$. $12 monthly particpation fee.
So for just signing up, she would have been in debt to them for about $250, or half her credit line, just for the privilege of carrying their card. Oh, and also 23% APR.
As soon as I pointed these things out, she tore up the app. We went into a local bank and got her a $300 secured card, with reasonable terms, that will eventually become an unsecured card, once she is established.
As an example, my daughter got a pre-approved application in the mail for a $500 card from somewhere. She started filling out the short application. I asked her if I could read the back of what she was applying for. I was shocked. Out of the initial credit line, they were going to immediately charge her:
1. $129 account set up fee (one time)
2. $99 one time processing fee.
3. $125 annual fee, billed over 12 mos.
$. $12 monthly particpation fee.
So for just signing up, she would have been in debt to them for about $250, or half her credit line, just for the privilege of carrying their card. Oh, and also 23% APR.
As soon as I pointed these things out, she tore up the app. We went into a local bank and got her a $300 secured card, with reasonable terms, that will eventually become an unsecured card, once she is established.
Facebook
Twitter