Choosing the Right Student Credit Card
In recent times, student credit cards are attracting attention of several students and parents. Students may use student credit cards to buy things, which otherwise they would not have afforded. Even parents feel comfortable and are at ease, knowing that their children have something to safeguard or to cover the financial expenses in case of an emergency.
However, students as well as parents need to know certain things about what to seek while choosing student credit cards because ultimately, parents are the ones who have to give money to pay off the monthly bills, unless students do some part time jobs.
Important Facts about Student Credit Cards:
If you are a student and wish to apply for college credit cards, you need to select credible credit card companies. To check the credibility of such cards, consider the rating and credibility of the company by visiting the nearest credit bureau office.
Many a times, companies bombard students with several offers through direct mails or e-mails or by delivering brochures on college campuses. They lure them by offering gifts, rewards and so on. Such offers are tempting but they might contain some hidden defects in them.
For instance, the grace period of student cards vary from one card to other. Grace period or tenure is the speculated time, which passes between the purchases made, and time when the interest starts accumulating. Certain credit cards have grace periods of 30 days while average cards have 23 days.
Considering these things is important because some credit cards do not have grace periods at all. This means that, you have to pay more interest even if you pay the pending amount one day after the speculated time.
Before applying for student credit cards, you also need to study about the additional fees which most companies charge. Two of such additional fees are late fees and over limit fees.
For instance, certain credit card firms may charge you with over limit fees of $35, when the amount crosses the limit by $1. Late fees are usually around $25 for most of the student credit cards. However, some cards do offer a leniency time. It means that you do not have to pay late fees (penalty) if you make the payments, say within ten days.
So, make sure that you make your payments on time, as late fees goes on increasing and accruing with each passing month. Many companies increase late fee charges to 25 % to 30%, once or twice in a year.
Overview:
Student credit cards help in building your credit history, even before you step out in the real world. However, many students do not make proper use of such cards and fall in debt. The late payments interest rates accrue and in no time, turn into huge debts. Thus, it hampers credit score.
Apart from this, bad credit may also have a negative effect on the employment. Some firms such as banks rarely hire individuals who have bad credit score. Therefore, one needs to consider these aspects while applying for student credit cards.
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