Credit cards are an easy way to pay for goods and services. Higher credit limits allow cardholders to make emergency payments on short notice if necessary. It can be difficult to get approval if you have bad credit. In this article, I will tell you how to find the best credit cards based on your credit score.
Once you know what your credit score is, you can purchase the type of card that best meets your needs. If you are trying to rebuild your credit you need to find a bank that will approve you for a card so you can start rebuilding your credit. If you have good credit, you’ll want to look for the lowest interest rates and possibly other benefits such as rewards.
What Is Your Credit Score?
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Credit scores range from 300 to 850 and help lenders assess the level of risk associated with borrowers. Every lender is different, and credit scores are not the only thing they consider. But a credit score of 800 or higher is considered the best, 740–799 is considered good, And 670–739 is considered average. Lenders with a score below 700 are more likely to be denied credit. And the lower the score, the higher the interest rate. For some credit cards with high thresholds and high interest rates, mid-, high-end 500s to mid-600s scores can still be accepted. However, once the score reaches 600, unsecured credit cards are unlikely to be approved.
Go to annualcreditreport.com for your free credit score.
Related: Guide To Credit Score Levels
Two formulas – FICO and VantageScore 3.0 – are used to calculate your credit score, but they both emphasize the same thing. Payment history and credit usage are the most important, followed by the average age of your credit accounts. The number of inquiries in your credit and the combination of different types of credits are also considered but less important. Using credit is a key factor in dealing with credit cards.
You can improve your credit by paying your credit card bills on time and never balance more than 30 30 of your expenses. Having at least 70% of your available credit indicates that you can handle your financial responsibility which can increase your credit score.
The three major credit bureaus, Equifax, Experian, and TransUnion, provide one free credit report each year. But credit scores are usually provided by lenders as an independent source. The bank that provides your bank account or your credit card may offer this service.
Related: 5 Best Credit Score Apps
Finding the right match: Credit Cards based on your credit score
Whether you have good credit, bad credit, or somewhere in the middle The Financial Globe Score Match provides a list of credit cards based on your credit score. The site also provides a credit card approval rate, giving you a better idea of whether or not your application will be approved.
Some credit card issuers will do what they call a soft inquiry on your credit report to determine if you are likely to be eligible for any of their cards. It does not affect your credit score. This is helpful when you are trying to determine if you are eligible for a card. If you do not meet the eligibility criteria, you can be sure that your application will be rejected.
However, the partnership does not guarantee that you will be accepted. Once you apply, the credit card issuer will do a thorough review of your credit history and income to determine if you meet their eligibility. If you are denied, you will receive a letter in the mail within a few days explaining why your application was rejected.
Popular credit card issuers that will allow you to check eligibility include Bank of America, Capital One, Citi, Discover, and American Bank.
What credit cards are best for bad credit?
If your credit is too low to be approved for a standard credit card, a secured credit card might be worth a try. With such an account, you will need to make a deposit to secure your credit line. After several months of responsible use, you may be able to convert your secured credit card into an unsecured credit card. Secured credit cards are best for building your credit and some don’t even check your credit score to be approved. However, because your credit score is lower you are considered a high risk to lenders so these cards will tend to have a higher interest rate and more fees. But secured credit cards are temporary and only used when you need to rebuild your credit.
Once you get the unsecured card, you will probably have a lower limit. The best way to help improve your credit score is to use the card for just one or two minor purchases each month and then pay the full bill. After several months of using and paying for the card, you should notice an improvement in your credit score.
Related: Best Credit Cards For Bad Credit
What Credit Cards Are Best For Good credit?
If your credit rating is higher than the mid-700s or north of 800, many cards offer low-interest rates, cashback, points, or other benefits for cardholders. Some cards are tied to rewards for staying at airline fairs or specific hotels, others offer cash, and some have a points system that lets you pay points to specific goods or services. For example, Chase Freedom Unlimited has a card that offers double points for travel purchases, while Discover It Cash has a card that offers 5% cash on certain purchases.
#1 Chase Freedom Unlimited – Best For Bonus Rewards
- $200 bonus after you spend $500 on purchases within the first 3 months.
- Earn 5% on travel purchased through chase Ultimate Rewards.
- Earn 3% on dining at restaurants, including takeout and eligible delivery services like Doordash.
- Earn 3% on drugstore purchases.
- Earn 1.5% on all other purchases
- Cashback rewards do not expire.
- 0% APR for 15 months
- No annual fees
- Requires Good or Excellent credit (690-850)
- Has a foreign transaction fee
#2 Citi Double Cash card – Best 0% Interest
- Earn cash back twice! Earn unlimited cash back on every purchase then as you pay for those purchases you earn an additional 1% cash back on those credit card payments.
- No annual fee
- 0% APR on balance transfers for 18 months
- No sign-up bonus
- No 0% APR for purchases
- $25 minimum redemption
- Requires Excellent Credit (720-850)
#3 Discover It Cash Back – Best for maximizing rotating category rewards
- 5% cashback on everyday purchases (up to $1,500) each quarter at such places like Amazon, grocery stores, restaurants, gas stations and when you pay using PayPal
- 1% cashback on all other purchases.
- Discover will automatically match all the cash back you’ve earned at the end of your first year.
- No annual fee
- 0% APR for 14 months
- Requires Good – Excellent credit (690-850)
Most popular credit card providers have several variations of the reward system. The best approach is to analyze the type of credit card purchases you typically make. Then look for rewards programs that relate to those purchases. If you eat a lot, look for cards with bonus points for eating at restaurants. If you drive a lot, look for cards with bonus points to use at gas stations. Doing so is a great way to take advantage of your good reputation and get some discounts on some of your general expenses.
Do you have bad credit, no credit or want to learn how to become a credit expert?
Check out our credit repair training and learn:
- What your actual credit score is
- How to get a copy of your free credit report
- How to get your credit back on track today
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