Are you shopping for a new credit card with a specific aspect in mind? Whether you’re looking for one with specific rewards or simply looking for one with a lower APR percentage, you’ll want to conduct extensive research to find which one is best for you. Before you send a request to get approved, here are four things you should always look out for when applying for a new credit card.
Annual Percentage Rate (APR)
According to consumerfinance.gov, your APR is basically how much you will pay to borrow money. This is provided to you when you sign up for a card. The current average APR is 16.45 percent, according to bankrate.com. Some store-based credit cards, like the Best Buy Rewards Zone Card, have a 25.24 to 29.99 percent APR. Be careful of credit cards with an APR of over 20 percent as you can usually find a better deal even if you have a lower credit score.
If you tend to use a credit card only for emergencies, check to see what the credit limit on the card is. If you’re unsure what your amount should be, U.S. News has put together an article on how it’s determined, and ways you can potentially get a higher limit.
Why give credit card companies more money than you have to? For example, the MasterCard Black Card charges a $495 annual fee. If you do sign up for a card that typically does have an annual fee, check to see if you can get it waived for the first year. Annual fees are usually added to your amount due and can add interest over time. Should you decide to go with a card with an annual fee, know when it’s charged to your account so you are prepared to pay for it.
Also consider late payment fees and how harsh they are, especially if you have a lower credit score. If you tend to travel a lot, sign up for a card that has no international transaction fees.
Blackouts on Miles/Cash Back
Many credit cards limit when you can book tickets using miles or whether or not you qualify to get cash back based on your payment history. Carefully look at your earning rates for both along with how you can retrieve your reward before committing to a card. Cards like the Capital One Venture Card allow you to redeem miles on any airline.