Choosing Between Student Credit Card Offers
Posted on November 25th, 2010
There used to be thousands of student credit card offers out there, all competing for clients. College students just had to walk on campus, fill out a form, and presto: a brand new credit card, no credit check or history required. These days, though, things aren’t so simple, and credit card offers are fewer and further between.
What happened?
There are a number of reasons that student credit card offers have slowed over the past year or so. The main two, though, are the economy and new federal laws involving credit cards, primarily the Credit Card Reform Act. While the Credit Card Reform Act is generally a good thing, it has made it harder for students to get credit cards.
In the past, companies were pretty reckless with student credit card offers. They knew most students would make a strong effort to repay their debts, that they’d accumulate a lot of debt, and that their parents would help them out. For those reasons, students presented a low risk option, and credit cards blithely extended ludicrous amounts of credit in their direction.
Under new laws, credit cards have to be a lot more stringent about lending to students. You may require cosigners and guarantors before you can even obtain a card, and you certainly won’t have the $10,000 spending limit your older siblings may have.
Dealing with the new student credit card offers
That doesn’t mean you can’t have a credit card, and it’s actually not such bad news. Believe it or not, this isn’t the government trying to ruin your life; it’s the government trying to control the epidemic of student credit card debt. It may mean some trials in the short term, but in the long run you’ll be happy not to graduate with massive debts.
In the meantime, student credit card offers do exist. Instead of focusing on which card has the best rewards as many students used to, though, you’re going to have to consider:
1. Which card can I get? If your parents or guardians aren’t in a good position to, or are unwilling to, stand as cosigners, you could have trouble obtaining any card at all, which is a good place to narrow your search to start with.
2. What can I afford? Limit your college debt as much as possible.
3. What’s the best deal? Forget rewards and the like. Look for cards with no annual fee and low interest rates. Air miles don’t matter when you’re thousands of dollars in debt.
Remember, there are still student credit card offers around, and it’s up to you to choose the best one.
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