"5 Simple Rules" - How to Find a Good Quality Credit Card

By: Bryan Pringle, Ph.d.

Just about everybody has some sort of these days. Whether it's with a retail store, gas chain, or with the large credit card companies. There is a large variety of choices when it comes to interest rates, annual fees, late penalties, balance transfers, and payment terms. Following these "5 Simple Rules" when applying for a credit card, can save the consumer a ton of money and lots of headaches, down the road.

Rule #1: Always look for a credit card with a low interest rate, or a 0% balance transfer option. This is extremely beneficial to the borrower, so that he or she, may have the ability to transfer their higher interest rate credit cards to the 0% or low interest credit cards.

Rule #2: Always look for a credit card that has a grace period on payments that are late. Many credit card holders have their interest rates boosted automatically after making a payment late within a certain period of time. This certain period of time is usually between six months and a year. Some credit card companies will boost the interest rates anywhere from 5 to 10 percentage points, after just one late payment. There are even credit card companies that reverse the 0% balance transfers to retroactively charge interest on balances after payments are made late. So that low interest credit card, now turns into an out of control debt monster that will devour all of the borrower's income.

Rule #3: Always look for a credit card with a little or no annual fee. If the borrower has good to excellent credit, say with a credit score of 620-850, then it is extremely easy to search online to find a little or no annual fee credit card. Obviously, there are exceptions to this rule such as business, revolving, or corporate credit cards, which may offer extremely high or even no credit limits, for an annual fee. Additionally, not having to pay an annual fee, is almost impossible, for the credit applicant who has a bad, little, or no credit history.

Rule # 4: Only apply for a credit card with a company that has a proven track record with a solid reputation in the financial industry. Many credit card companies have a reputation of honesty, fairness, and excellent customer service. However, there are many credit card companies who have reputations of changing terms frequently, raising interest rates often, having bad customer service, and receiving large amounts of complaints from consumers. It will save the borrower a lot of time, headaches, and money to find a credit card company that is reputable.

Rule #5: Never apply for a credit card with a company that stipulates that they can accelerate your payment of the debt. Many cardholders don't know that numerous credit card companies can, and do, sometimes raise the minimum monthly payments due by the borrowers to extremely high amounts. Some raise the minimum monthly payments to as much as 200% of their regular payments. So beware of the cardholder terms of agreement. Read the legal terms and conditions for the credit card very carefully.

If you follow these "5 Simple Rules", then you too, will be able to steer away from pitfalls that befall millions of credit card holders, and you will be able to say confidently, that "Yes, I have a good quality ."

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