Credit Cards for Students

student-credit
courtesy of http://www.ninjacredit.com

Liability or Asset 

To be considered as a reliable borrower in the United States, one must have a good credit score. Credit score defines one’s creditworthiness; when it comes to home mortgages, student loans, car purchase payments, credit score plays a vital role. Having a credit history and a good credit score is also helpful for a young student, who wants to rent an apartment, buy a car, buy a new computer or simply build up a credit history for future deals. Among those are international students; to be eligible to apply for the credit card as an international student, one must fulfill certain requirements. First one must have a Social Security number. This number can be obtained if you are legally employed in the United States; for example for international students it’s usually a campus job. Second is the address in the United States, usually it’s the address of the school; for those who live outside the campus the address will be the place where they reside. Third, a certain amount of income is required to apply for a credit card, 4 000 -10 000 a year is an acceptable amount of income for a student. Fourth one must have an US bank account; students usually have checking accounts to deposit cash checks or generally use it for debit purposes.

Getting a Credit Card
After fulfilling these four requirements one is eligible to apply for a credit card. One must remember that getting a credit card is similar to borrowing money from a bank: it eventually must be returned; however, instead of borrowing a certain amount at once, one can use a credit card as a payment tool on demand. After you apply for a credit card you will become an applicant. If you’ll get approved you will get a credit card mailed to you. Some credit card companies have student specific credit cards. Usually, those companies give out a low starting limits to the students and increase the limit from time to time depending on the payment history of a costumer. This is when a student needs to be careful, at first it looks like a free money; however, in a long term one ends up paying more than one actually spent. Usually the amount of money available for students with no credit history when they get their first credit card is around 500 to 800 dollars. When applying for a credit card one must take a look at the APR, annual percentage rate; that is the amount of the interest in percent that a costumer will own on top of the remaining balance on his or her credit card account. Some credit card companies offer their clients APR free service for certain amount of time (usually when they first become members), meaning that they will not charge costumers any interest for the time they agreed on. However, after the time passes they will start to apply interest to one’s account. Usually in the US, APR varies from 13-25%.
Maintaining a Good Credit Score
search_credit-score-estimatorMaintaining a good credit score is vital for the credit history in the United States. As mentioned above, people with a high credit score are more likely to borrow money or rent an apartment than those with lower credit scores. There are several different forms of evaluating one’s credit score. One of the major ones is FICO credit score; it ranges from 300 to 850, closer you are to 850, better your credit score is. FICO credit score depends on several different factors. Major factors are: Payment history and the amount one owes. The less important but significant factors are: length of the credit history, if the new credit is opened and what types of credit one has. For maintaining a good credit score one should take in consideration two major categories, payment history and the amount that one actually owes. Late payments negatively affect one’s credit score, therefore if you own a credit card you should be paying at least the minimum balance on time. Second most important is how much the debt is, big amount of debt for a long time significantly lowers one’s creditworthiness. Especially a student must watch how much one is spending and try not to “bite off more than one can chew”, because over time one will end up owing more than one can afford to pay and in conclusion one will end up having a bad reputation as a borrower.
Should I or Should I not?
After reading this one might be concerned if he or she should get a credit card or not. The question is will it profit or hinder his or her reputation as a borrower? Taking something up is usually hard; however screwing up what you started is very easy. One must be careful of how he or she manages credit cards. In the end it all comes down to an individual person, but there are some fundamental tips how to keep credit more or less descent: Apply for only one card for the first time. Take your time to test yourself. Observe your abilities to handle your credit and then apply for another one if necessary. Evaluate yourself, think how often you are going to use your credit card, or how much you would spend. Set your own limits, forget about how much you actually have available on your credit line. That way it will be easier for you to pay off the balance. Students usually make a mistake and spend their allowance without analyzing the risks; they usually end up making partial payments, that lead paying way more than owed and negatively effects on the credit history. Credit cards are really useful for those who can manage them responsibly.
Links below show some major credit card companies and banks that offer student credit card services:

Discover – https://www.discover.com/credit-cards/student/
Capital One – http://www.capitalone.com/credit-cards/journey-student/
Bank of America – https://www.bankofamerica.com/credit-cards/products/low-interest-student-credit-card.go
U.S. bank – https://www.usbank.com/credit-cards/college.html
Citi Bank – https://www.citi.com/credit-cards/credit-card-details/detail.do?ID=citi-thankyou-preferred-credit-cards-for-college-students

Luka Jorjoliani
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