Credit Card Applications - Top Ten Tips

Looking for a new (or your first) credit card? Here are the top ten tips you should keep in mind when you apply for a credit card.

1. Think about your spending patterns and habits.
Knowing whether you intend to pay off your balance each month or carry a balance from month to month will help you choose the right credit card.

2. Use the Summary Box for quick comparisons.
By law, every credit card UK offer - whether by post, online or in your inbox - must have a Summary Box that lists the most important features of the credit card, in a specified order using specified language. Having everything laid out in the same format for every credit card makes if far easier to compare one with another when you apply for a credit card.

3. Choose your credit card carefully.
Don't just apply to an offer because it landed in your inbox. There are dozens of credit card offers UK consumers can apply for - and it's important that you do your research and choose one that will cost you the least amount of money to use.

4. Get your free credit report.
Before you start deciding which credit card to apply for, know which ones you're likely to get. You can get your free credit report once a year so you'll know what bases the credit card companies have to judge you. Knowing your credit rating lets you apply only for the cards that you're most likely to be approved for. This is important because?

5. Don't apply for too many credit cards at once.
Every time you apply for a credit card, UK companies send a request for your credit report, and make a note of it on your credit report. If you have a lot of requests for credit cards on your report in a short period of time, they worry that you're running into financial trouble, or that you'll get in over your head. In short, it knocks down your credit score. Don't do it.

6. Comparison shop for credit cards online at moneyeverything.com.
Moneyeverything.com is more than a directory of credit card offers. Their handy tools can help you pick and choose between credit card offers and find the ones that work best for you.

7. Watch out for credit card scams.
We're not talking here about the phishing scams - those exist as well. What we're talking about is the solicitations and adverts that show up in your postal box or email inbox telling you that you have ?already been approved!' Read the fine print. Check the summary and disclosure boxes. Chances are that the 'credit card' being offered is a membership card to a catalog shoppers club. The very best way to avoid these scams is?

8. Never apply for a credit card from an email or post advert.
Those advertisements seldom offer you the best credit deals available. Instead, see Tip #6. A site like moneyeverything.com is not making its money by plumping one particular credit card offer. It's in THEIR best interest to make sure that YOU'RE well-informed.

9. Know the difference between introductory, advertised and real APR.
The APR - annual percentage rate - is the number most commonly used for comparing credit cards. Many offer an introductory APR which will only be in effect for a short period of time. After that, they show you the 'typical' rate. This rate is the APR that must be offered to at least 2/3rds the consumers approved for that credit card. That means that 1/3rd - that's one in every three people who are approved - are offered a credit card at a higher rate of interest.

10. Watch out for hidden fees.
Back to Tip #2 - the disclosure/summary box. Before you send off an application, be sure that you read the fine print. If there's an application fee, a processing fee and/or a membership fee, you WILL be liable to pay those if your application is accepted - even if you never charge a single purchase to the card. In most cases, they'll be charged directly to your new credit card, meaning that you'll have a balance collecting interest before you even open the envelope to pull out your shiny new plastic.