Choosing a credit card can be the start of a healthy financial relationship. There are many types of cards and different rewards programs, so it is essential to understand what you need and want from your card before applying. For example, here is an overview of how to choose and apply for a credit card and how long does a credit card take to arrive?
View Your Credit Score and Check Your Eligibility
After you enter your personal information and submit it to the credit card company, they will check your eligibility. This can happen in one of two ways:
- First, they will look at your credit score and decide based on what they see there. A good credit score means a high likelihood of repayment, so you may not qualify for the card if you have a low one.
- The other way is that they’ll pull up your full report from Experian or another agency and look over all of the details included in it before deciding whether or not to approve you for the card.
Measure Your Debt-to-Income Ratio
The debt-to-income ratio is the percentage of your monthly income that goes toward paying debts. For example, if you spend $500 a month on credit card payments, and your average monthly income is $3,000 (total, not including taxes), then your debt-to-income ratio would be 16%.
To calculate this number, divide your monthly debt payments by your monthly gross income. If you use this method to measure your financial situation, ensure it’s as accurate as possible by including any additional expenses such as child support or alimony payments.
Choose and Apply for the Card and Wait for Approval
Now that you’ve decided on the right card, it’s time to apply. Before doing so, ensure you’re eligible and that your credit score is high enough for approval. You’ll also want to check the interest rate and fees associated with the card and if there are any signup bonuses or perks associated with it. For example, “If your card is lost or stolen, it may take between three to 14 business days for a new one to get sent out,” says SoFi experts.
Activate the Card When You Receive It
When you receive your credit card in the mail, make sure you have it in hand before activating it. This is a good time to double-check the expiration date and make sure there are no mistakes on the card’s face. The activation process only takes a few minutes and requires you to provide enough funds for an activation fee (usually around $10). If paying by phone or online, be prepared to sign an agreement with your bank and provide identification when asked for ID.
Make Payments On Time and In Full Every Month
Make sure you pay your bill on time and in full every month. Call the company and ask for a payment extension if you can’t. Ask for a partial payment extension if you can’t pay part of your balance.
Hopefully, this article has helped you understand the complete process of applying for and getting a credit card. Now that you know what to expect, apply for your card!
