Getting a credit card is easy, but there are a few requirements that you need to be able to meet to secure a new card. Your income is one of the things that will determine what type of credit card you can access and whether you will be able to get approved for it. To ensure that you have the right card suited for you here are a few things you need to know.
Do you meet the minimum amount?
Every credit card that you will be applying for has a set amount of income that you need to be earning in order to access it. To access the most basic credit card you need to be earning at least $15,000 per year before tax. Your income will act as a guide for lenders to give you a credit card that is suitable for your financial circumstance.
Checking the minimum amount that is required of you before applying can prevent your application from being rejected. Keep in mind that the more you apply and get rejected in a short space of time will reflect on your credit report which will be viewed negatively by lenders.
Comparing your options
The higher your income bracket the more likely it is that you will be able to access a card that comes with better features. However, keep in mind that just because you can afford it does not mean that it will be suitable for the type of spender that you are. It is vital that you compare cards that will be suited towards your financial circumstances. If you are looking for a card that offers you the ability to manage your money better with no frills, then a basic credit card could work for you. However, if you know that you are a frequent spender and need benefits that will help you maximise your savings then you could look into getting a card that comes with additional features such as rewards program incentives and complimentary extras like travel insurance.
Always keep in mind that the more features you add the more you will have to pay in annual fees.
Can you meet more than the minimum repayments?
When comparing your credit card, you need to check if you will be able to meet more than the minimum repayments. This will help you know if the card is affordable to your current financial situation. It will also safeguard you from defaulting on your monthly repayments which can attract a penalty fee that can be placed on top of your interest rate.
Check your credit history
Being able to meet the income criteria allows you to get one foot in the door when it comes to applying for a credit card. There are other factors that your lender will look at to assess your credibility like our credit history. Your credit history will reflect all your current and previous loans and whether you were able to handle this responsibly. Being a responsible borrow will help you build a good credit score which will increase your credibility with lenders. Always keep in mind to check your credit report and history to ensure that all is in order before applying.