Credit Card Approval for Young Adults

Getting credit cards for young people isn't as easy as it was before. And for good reason. With college students graduating with an average of $2000 of debt, it shows a problem that must be addressed. What that statistic shows is that young people aren't so savvy when it comes to handling personal finances. It doesn't also help that credit card issuers used to target college students and young people with abandon. This is why there are provisions in the Credit Card Accountability, Responsibility, and Disclosure Act (or the CARD Act) where those under age 21 would not be granted a cards unless they have a co-signee or are able to show their capability to pay off their financial obligations. Through this law, young people are better protected from carrying debt at such an early point in their lives.

The new regulation may make it harder to get a card, but it also makes it safer for young people to own a credit card. Before anyone under 21 can be approved for a card, he or she should show some form of income or asset that can offset possible debt. Having a part-time job, a trust fund, or any other form of income would be sufficient to show that you can pay off what you owe. And if you don't have those, other options would be to get a co-signee who would pay the debt if you default, or have you sign up as an authorized user under your parent's credit card. Young people may have a few more hoops to go through, but it's all for the best.

One challenge that kids may encounter in applying for a card is that some issuers don't like having co-signees. This is because with a co-signee, the legal responsibility is split between the cardholder and the co-signee. Companies prefer the authorized user setup since it would be easier to go after the parents should the kids' debt swell up.

Another challenge is that some credit card accounts don't report authorized users to credit rating organizations. This means even if your kid has a card under his or her name, no credit history will be built. That takes away one of the biggest advantages of having a credit card early, and that is to create a good, solid credit history to make it easier to apply for loans and financial aid in the future.

With those in mind, you should make sure that your co-signee has a good credit rating to appease the minds of issuers. Also, before signing up as an authorized user, make sure that it gets reported to credit reporting agencies. Once you have those set, you place yourself in a better position in reaping the advantages of owning a credit card early. The system may make it harder to get a card for young people, but it also makes it easier to keep kids on the right track when it comes to credit card management

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No Credit Credit Cards - A Brief Guide

When it comes to getting a credit card, you can usually understand why people with bad credit often get refused; they've shown in the past that their handling of money isn't exactly perfect, so giving them more credit to spend isn't in a lender's best interests. But what if you're just starting out on the credit ladder - say, you've just had your 18th birthday or you've somehow managed to get through life without having any dealings with credit companies? Believe it or not, that can actually be just as bad as having bad credit!

While that might sound crazy though, it actually makes sense when you consider what card providers look for - namely, security. In giving you a card, they're lending you money and expecting it back with interest, so it's no surprise that credit card companies want some kind of assurance that this is going to happen. That's what credit checks are for, because they check against your credit history and see how responsible you've been with your finances in the past. If you've got a good credit history, they'll see that and happily hand over a card; if your credit rating is bad though, they'll see that too and turn you away.

Unfortunately, if you've not had any kind of credit in the past then all these companies will see is... well, nothing! There'll be no proof of how well you can handle money, no assurance that you won't overspend on any credit they give you and no evidence that you make regular repayments on anything you borrow. And sadly, that means you're likely to be turned down simply for the fact that the card provider won't have any way of telling if you'll use it wisely or pay off enough interest to make it worth their time.

Of course, that doesn't mean you can't get a credit card - it just means you'll need to approach a provider that specialises in cards for high-risk borrowers. Some, like Capital One and Vanquis, have cards for people with bad credit and these can also work for people with no credit, although they have interest rates much higher than most other credit cards (usually between 35 and 40%). However, Capital One also has a 'no credit' card with a slightly lower rate (around 29.9%), as does Barclays. If you're just starting out, these can be ideal for building a credit rating especially since they can even have their rates lowered and credit limits raised if you use them responsibly.

In Summary

No Credit Credit Cards...

    * Can be hard to get approval for from the mainstream credit card providers
    * Are usually lumped in with credit cards for people with bad credit
    * Do exist, although they have higher interest rates than regular credit cards
    * Can be provided by the likes of Capital One, Vanquis and Barclays

Copyright: Individual Finance, 2010

Individual Finance has informative articles on No Credit Credit Cards, Bad Credit Loans and many other aspects of UK finance. It also keeps users up to date with the latest money-saving offers and vouchers through regular e-mail newsletters.

Martin Mathers writes for Individual Finance -- he's a professional journalist and writer with 12 years of experience under his belt, covering everything from finance and business to movies, music and technology

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Credit Card Debt Among College Students - 5 Facts You Should Know

College students and credit cards don't mix, but that doesn't stop most college students from running up their card-based debt. Despite the fact that most college students are of above-average intelligence and have strong self-discipline, their young age and relative inexperience in dealing with credit makes it tough to resist running up a large tab on their cards.
Furthermore, students these days are faced with ever-increasing tuition and other expenses. With cash flow tight for many students, their cards become their most convenient resources for buying the things they need to get by in college.
Fortunately, there are other alternatives to credit card use in college. If you would like to learn more about credit card debt among college students, consider these 5 facts you should know:
1. College students are carrying more card debt than ever while in school:
Sallie Mae, a prominent student loan organization in the U.S., has recently found that the average college who has at least one card student carries well over $2,500 in credit card debt.
2. They are also graduating with more debt:
The average college student these days is graduating with about $4,100 in card debt. This is an all-time high since such statistics began being analyzed by Sallie Mae.
3. Carrying a card is a good idea in terms of planning for cash emergencies:
Of course, many students resist giving up their cards because they do not want to be caught in an emergency situation whereby they need to make an important purchase but they do not have enough cash to cover it.
4. These days, students need a co-signer to get a card:
For better or worse, however, these days it is tougher for freshman and sophomore college students to qualify for a credit card. That is because new, strict legislation makes it illegal for large credit card companies to solicit card applications to students under 21.
Still, despite this new legislation, students are finding new ways to get their hands on cards. For example, if as a student you get someone you know to agree to co-sign on the loan with you, you can still get a card. However, this does not solve the root problem: students tend to run up unsecured card debt.
5. A smart alternative is to get a prepaid debit card instead:
A smart way around the use of these cards but while still having a back-up for emergencies in place is to buy pre-paid debit cards instead of credit cards. Debit cards require no application process, and they are not associated in any way (positively or negatively) with the students' credit score. You just pre-pay for the amount you need and go. Then, of course, the student can keep a credit card as a backup for emergencies but only use it when a situation arises.
Consider these 5 facts as you explore the problem of credit card debt among college students and what to do about it in your situation.

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American Express Credit Cards Offers Excellent Options

The fact is that American Express credit cards can be found in such a relatively large selection that you may possibly not recognize what type is the best for your needs. There are cards that have no annual membership fee, money back incentives, small business along with large business cards. They have of late additionally turned into a fairly large provider within the gift card business as well.

We need to highlight the fact that American Express issues both credit cards plus charge cards. The real difference generally is that while in fact you can hold an account balance over from one billing cycle to another in succession utilizing a credit card, a charge card must be paid back completely each month.

One offer that's new happens to be the Zync from American Express. This financial instrument permits you to select as many or as little within the Lifestyle Packs as you wish. In the event you determine you would like to include another one in the future, you are able to accomplish that.

The ubiquitous American Express Green Business card happens to be the signature business bank card for individuals that have a rather substantial income and need more flexibility than a traditional credit card is able to supply. There is not a set in stone spending limit and the first thing you buy on this card can earn the user 5000 bonus points.

Bonus points are redeemable for numerous forms of perks ranging from cruise trips, travel packages, spa retreats, airline tickets and hotels across the globe. Moreover, American Express credit cards offer you travel accident insurance, theft and collision insurance protection for vehicle rentals, baggage insurance protection and also a consumer protection plan.

Blue Cash is another of many forms of American Express cards. This card features 5% money back on every single expenditure made that is qualified and there is no yearly membership fee. For certain, AMEX Blue is thought to be one of the top credit cards in the marketplace.

It ought to be pointed out that AMEX normally calls for greater than standard credit scores for authorization. They also happen to be the undeniable market leader when it comes to giving business cards to small businesses.

American Express credit cards have been around for decades. All of us have seen the ads promoting their offers including traveler's checks that can easily turn out to be replaced in the event they are lost or perhaps stolen. American Express is a major participant around the credit sector and they feature a large variety of financial instruments.

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