How to Get a High-Limit Credit Card

Image attribution: Peter Kratochvil, Public Domain

A higher credit limit is possible with bad credit using a number of relatively effective techniques that lower risk to lenders or at least give the quantitative impression of lower risk. Some methods involve building credit score, others involve the mechanics of applying for credit cards. Depending on the credit card applicant's timeline and existing situation, the right methods to use to get approved for high-limit credit cards vary. Some of the following methods can be used for applicants with no credit cards, whereas others can be used by people with or without credit cards.

Know the lender's policy

Creditors establish credit ratings using several factors. The credit report is a major influence, but ultimately the credit limit is set by the lender and not the credit rating agency. Knowing the lender's policy on credit card limit increases helps borrowers know what they need to do to increase their credit limit. Such being the case, asking the appropriate lender representative about their credit limit policy can offer helpful clues to getting approved for high-limit credit cards with a bad credit rating.

Lower credit utilization ratio

Credit utilization is a ratio used by creditors to determine how much debt payment capacity a borrower has, and the level of risk associated with lending to that client according to the Fair Isaac Corporation. A good way to help improve the chances of getting approved for a high limit credit card is to lower this ratio before applying. For example, if an applicant already has credit cards, pay the balances off to demonstrate ability to control debt and to lower the credit utilization ratio.

Select applications carefully

Some credit cards are specifically designed for people with bad credit. These cards can be found using a credit card screener. Some creditors may be more likely to offer higher credit limits than others. Larger banks with aggressive lending programs may also be a good place to start looking. According to Smart Credit Choices, a credit card comparison website,  applying for multiple credit cards increases the chance of obtaining a higher limit credit card. Moreover, also per the Fair Isaac Corporation, multiple credit inquiries generally have a low impact on credit score.

Rollover credit card balances

Another way to get approved for a high-limit credit card with bad credit is to consolidate other loans. Lenders that want credit card business through consolidations may have to raise the credit limit beyond what would normally be approved to accommodate the credit card consolidation. However, if the consolidation is a response to an offer, this may yield promotional interest rates and may also be a good sign as the creditor may have actively pre-screened borrowers for consolidation loans. Investopedia, a financial information provider, recommends having the credit transfer fee waived in the event of credit consolidation.

Prepaid and secured credit cards

If paying up front isn't a problem, there's a better chance of obtaining a higher credit limit on a prepaid or secured credit card. Moreover, even with a bad credit score, getting approved for a prepaid credit card with a high limit may prove to be relatively easy provided the card is paid for ahead as condition for approval. Additionally, having a high limit prepaid credit card may indicate to other creditors that a borrower is capable of managing a higher credit limit potentially making it easier to get approved fro non-prepaid credit cards with higher limits.

Utilize credit building methods

Lastly, building credit score using methods endorsed by the Federal Reserve Board or the Federal Trade Commission can help credit card applicants receive a higher credit limit in the long run. These methods include reviewing credit reports for inaccuracy, correcting any mistakes on credit reports, paying off outstanding debts and establishing a strong bill payment history. Since credit score is a factor in the credit limit assessment, having a higher credit score naturally improves the probability of a higher limit request will be granted.

How to Get Approved For High Credit Limit Credit Cards With Bad Credit

Getting a higher credit limit with a bad credit score is not impossible. Several techniques can be used to help facilitate the approval of raised credit limits for credit card holders with bad credit and those with bad credit who don't have credit cards.

Complete article link: http://www.helium.com/items/2128247-how-to-get-a-higher-credit-card-limit

Do Prepaid Debit and Credit Cards Affect Credit Score?

Prepaid debit and credit cards can build credit score, but not in the same ways as a secured or unsecured credit card does. Since prepaid cards are structured differently, understanding how they work and what benefits they provide helps clarify how they can build a credit score.

Since secured and unsecured credit cards are financial instruments that charge interest on a balance, a line of credit is directly established and recorded through either a bank account or credit card balance. Prepaid cards on the other hand can be used like debit and credit cards, but without a bank account and with different application requirements. These prepaid cards can build credit in the following ways.

• Prepaid cards and payment history

Fair Isaac Corporation, the creator of FICO credit scores claims the scores are based on bill paying, debt levels, credit history and types of debt.(1) Payment history, which accounts for 35 percent of a FICO score, can be improved with any type of payment method including prepaid debit and credit cards.  Some prepaid cards even help cardholders build a card history as described in the next point.

• Prepaid card fee payments

A prepaid card that helps build credit are the Eufora prepaid Preferred and Elite Mastercards. Eufora's creditbuilder program automatically withdraws a monthly payment that goes toward the prepaid card's annual fee. This payment history is then reported by Eufora to TransUnion and Experian credit bureaus to help build cardholder's credit scores.(5)

• Line of credit via prepaid card

A prepaid debit or credit card may also have a line of credit feature that doesn't require a credit check or good credit.  An example of this is the iAdvance Line of Credit on a the AccountNow Prepaid Visa Card.(4) This line of credit feature is described as being auto-paid and reported to credit bureaus by  DoughRoller, a detailed money blog that provides a wide range of financial information for deal hunters.(3) This type of account feature is actually a hybrid between a prepaid card and secured credit card that requires no credit check.

• No credit check required

According to www.creditcard.com, the Upside Visa Prepaid Card does not require a credit check and doesn't require a bank account like credit cards do. This allows persons with bad credit scores to benefit from debit and credit payment systems. Moreover, the Upside Visa Prepaid Card also allows online personal checks and direct deposit making it somewhat similar to an bank account debit card.(2)

• Builds responsible card use

A final way prepaid debit and credit cards help build credit scores is by using the cards in a similar way to credit and debit cards. Since they are prepaid, the card user gets in the habit of working on a cash basis, but still uses the prepaid card as a method of payment. This trains the mind to use cards responsibly and may carry over into use of secured and unsecured credit cards by virtue of habit.

Sources:

1. http://bit.ly/ggXQt (myFico.com)
2. http://bit.ly/qvVSi (creditcard.com)
3. http://bit.ly/3M8MdF (doughroller)
4. http://bit.ly/9koCGb (AccountNow)
5. http://bit.ly/aWfjRm (Eufora card)

Best Credit Cards for Students

The best credit cards for students aim to build financial responsibility, save for college, and encourage good grades. Several credit cards exist on the market that address one or more of these student related goals with different card programs.

Some credit cards claim to be 'student credit cards', but don't necessarily offer services that different from other credit cards issued by the same company. The following credit cards are some of the better credit cards for students because they can be utilized with a higher return on spending, or are more likely to meet one or more of the aforementioned financial goals, especially if they are used alongside a budget or financial plan.

1. Student Upside Visa

The Student Upside Visa is a prepaid credit card that parents can fund and track expenditures for. What makes this credit card one of the best for students is that it can be funded directly from a parent's checking account without transfer fees. The Indiana Department of Financial Institutions provides student credit card tips and techniques to make the most of cards like the Student Upside Visa, and to assist with a real life financial education for students.

2. Fidelity Investments 529 American Express  

The Fidelity Investments 529 Rewards American Express offers up to $1,500 per year to be contributed to a Fidelity 529 College plan.  No annual fee is required for this card and a 0% APR on purchases and balance transfers is allowed for the first 12 billing cycles. This is among the best credit cards for students because it is focused on an educational goal.

3. CITI MTV U Platinum Select Credit Card

This card actually rewards good grades by offering reward up to 4000 points per year in addition to a 10 percent discount on music purchases made at shop.mtv.com. GPA rewards are offered on a two semester basis  and are divided into four levels from 2.5-4.0; a semester GPA between 2.5-2.99 earns 250 points and a 4.0 GPA earns 2000.

4. Upromise World Mastercard

The Upromise World MasterCard is another college savings plan card, and is one of the best credit cards for students for this reason. The difference with this card however is the benefits can be as high as 25 percent if the Upromise shopping network is used. Money earned through the Upromise student rewards credit card is put directly into a 529 college savings plan, or used to pay down student loans or college expenses.

5. Discover Student Mix Tape Card

Similar to the Upromise World MasterCard, the Discover Student Mix Tape Credit Card offers high, up to 20 percent, cashback rewards when the discover shopping mall is used. This card does not fund a college savings plan however, and consequently requires a greater amount of financial responsibility to benefit from the rewards.

Additional credit cards that students may benefit from are the Capital One Student Rewards Card, and the AccountNow Prepaid credit card. Using credit cards for school expenses alone, then paying them off before the grace period ends is a good way to build credit and earn up to 25 percent back for college savings or school expenses in some cases.

The downside of even the best credit cards for students is they require a fair amount of financial discipline to maintain a manageable balance and good credit score. Credit card companies bank on card users not being financially responsible enough to pay their balance off every month, especially if the cards have no annual fee or service charges associated with regular use.

Sources:

1. http://bit.ly/bjrjGd (Credit Card Assist)
2. http://bit.ly/f8f9t (Creditcards.com)
3. http://bit.ly/9VCLNh (U Promise)
4. http://bit.ly/9cFsmM (529 Rewards card)

The Top 10 Credit Cards in America

If by 'top credit card' one is referring to 1) low fixed interested rates 2) no hidden fees 3) member benefits and 4) banking services, then there are several credit cards that stand out as being among the best in America. 

That said, banking policies can change and credit card plans compete over time so the following credit cards aren't set in stone as the be all and end all of credit cards. Rather, these credit cards, at the time of this review, meet performance and quality benchmarks that measure quality, usability, service, cost and incentive in 5 categories of 2 cards each and specifically look for the following characteristics.

• Balance transfer rates and periods
• Introductory Annual percentage rate
• Low Annual percentage rate
• No annual fee, and member friendly terms of agreement
• Percentage cash back, airline miles or shopping rewards
• Member services, and additional benefits

Airline miles credit cards:

There are many airline miles credit cards to choose from. The two cards below take into account annual fees, cost per mile and bonus miles. These cards may be beneficial to individuals who frequently plan and purchase travel itiniaries.

Capital One No Hassle Miles Rewards: No annual fee, 2 miles per dollar over $1000.00
Miles by Discover Card: No annual fee, up to 12,000 first year bonus miles, 2X miles options

Low interest rate credit cards 

The following two cards take into account interest rates for purchases only, as purchases often comprise a large amount of credit card use. These rates do not necessarily apply to transfer of credit and cash advances. For those persons who don't plan on paying back all their credit purchases immediately, these cards might be worth considering.

• Simmons First Visa Platinum: 7.25% Fixed APR on purchases, and no annual fee.
• IberiaBank Visa Classic Card: 8.75% and up, no annual fee, long grace period

Cash rewards credit cards:

For those individuals seeking to lower their cash costs, pay off credit balances fast and who don't travel a lot, a cash rewards credit card may be just the thing. Combining cash rewards credit cards with discount store and credit card affiliate stores reduce essential purchase costs and can assist with individual budget goals.

• Chase Freedom Visa: 1-20% cash back, no annual fee, $50 cash back bonus program

• Discover More Card: Up to 1 % -20% for exclusive online purchases, no annual fee

Credit union credit cards

Credit Union credit cards are only available to select members. This limits these card's availability. However, for those persons lucky enough to have access to these types of credit cards the following two offer great interest rates with no annual fee at long established credit unions with assets in excess of $1 billion dollars. These cards may be useful for debtors seeking below average cost of credit.

• Apple Federal Credit Union- Visa Platinum: Prime rate + 0%, no annual fee
• Navy Federal Credit Union-Visa Platinum Master Card: 7.9%, no annual fee

Gas cost savings credit cards

Gas savings are important and with the regular use of automobile gas used by many households, a consistent flow of savings can be achieved through responsible use of a gas rewards credit card. The two cards below offer beneficial incentives for travelers and can lower monthly gas costs.

• Discover Open Road (SM) Card: No annual fee, 1%-5% cash back, Fraud protection

• Capital One No Hassle Cash Rewards: 2% gas and grocery reward, no annual fee

Summary

Identifying the best credit cards in America is dependent on a number of factors such as 1) limited time offers, 2) debtor objectives 3) credit ratings and 4) creditor terms. As with many credit providers, maximum credit benefits often require strong credit ratings, however, for some debtors, the best credit card offers may only be available to those with the highest credit rating. Consequently the above cards may be the best only for specific people.

Additionally, different credit card users can benefit from different cards depending on their credit rating, spending habits, budgeting skills, expectations etc. That said, cards which offer financially optimal rewards for the lowest cost with the fewest terms and best customer service(s) can be considered among the best. The ideal credit card offers can change upon offer expiration making the above card's benefits variable with time and competing offers.

Sources:

1. http://www.creditcards.com
2. http://www.askmrcreditcard.com/
3. http://www.lowcards.com/
4. http://www.creditcardguide.com
5. http://freemoneyfinance.com