Want to apply for a free credit card? Who doesn’t want a card that eliminates joining or annual fees and offers a range of perks! Well, before you go ahead and do that, take a step back. Checking your eligibility, the card’s benefits and other key information can make your experience go from bane to boon.
Here are some mistakes you must avoid while getting a fee-free credit card.
Trying Your Luck With Multiple Applications
You may want to apply for various free credit cards with several lenders to increase the possibility of getting one. This strategy may seem sound, but leads to multiple inquiries on your credit profile, which can imply that you are hungry for credit.
This can make you a high-risk applicant, and the issuer may not approve your application as easily. Multiple rejections can harm your financial health, along with your eligibility for credit.
Instead, try to plan your application by checking your eligibility and applying for a card with an issuer with whom you have a higher chance of approval.
Not Choosing the Right Card
To meet various preferences and needs, credit card companies nowadays offer different types of cards, like:
- Travel credit cards
- Reward credit cards
- Student credit cards
- Business credit cards
- Shopping credit cards
If you don’t get a card that matches your life and purchase behaviour, you won’t be able to enjoy it. Researching and shortlisting options based on your needs and wants is the way to go.
Ignoring Your Credit History
Credit card companies want to know that you’re capable of paying the bill on time. For this, they look at various factors:
- Overall financial profile
- Income and employment
- Credit report and credit score
- Age and residence
- Debt-to-income ratio
- Existing credit accounts
- Duration of credit accounts
Among these factors, they pay high attention to your credit report and score. This is because it is a numerical representation of your past behaviour with credit as well as your financial standing. By checking this information before applying, you can take the right actions to improve your chances of getting the card you want.
Not Paying Attention to the Eligibility and Documentation
Every credit card provider sets eligibility criteria and paperwork requirements. By checking this beforehand, you can plan your application better and avoid rejections. Generally, the eligibility criteria revolve around:
- Your age and residence
- Your income and employment
- Your credit score
- Your work experience
The documents generally include:
- Identity proofs
- Residence proofs
- Income proofs
Ignoring the Interest Rate and Other Associated Charges
Even though free credit cards come with zero joining fees, you must check other charges. Most credit card companies allow you to make part payment of your credit card bill. However, this facility comes with an interest charge on the balance amount.
Some issuers may also levy other types of charges, which can make the overall cost of the card higher. So, check the fees and charges thoroughly to avoid financial shocks later. These charges include:
- Annual renewal fees
- Interest charges
- Late bill payment fees
- Over-limit fees
- ATM cash withdrawal charges
- Foreign transaction charges
- Returned payment fees
Applying without Complete Details
Submitting the application with incorrect or incomplete information can lead to rejection since the details don’t match the documents that issuers consult during the verification process. So check and read through the form once or twice before you submit it.
Breezing Over T&Cs
Are you ignoring the fine print? While it can be difficult to read, going over all these terms is the only way to protect yourself from an unexpected financial burden.
While reading the terms and conditions, look for:
- How to collect and redeem the reward points
- What is the minimum amount to spend to get welcome points or waive off annual fees
- How to check your credit card application status
- What is the expiry date of the credit card
- Perks and benefits that the card offers
Underestimating the Benefits and Additional Perks
An attractive feature that separates credit cards from other payment modes is the rewards, benefits and additional perks they offer. If used smartly, they can help you save more and provide a great experience.
These additional perks include:
- Cashback on purchases
- Discounts and offers
- Welcome benefits
- Vouchers and gift cards
- Complimentary insurance
- Waivers on certain fees and charges
- Discounts on flights and hotel bookings
With this information in hand, you can apply for a free credit card smartly. An excellent option to look into is the One Credit Card. This card is super cost-effective since there’s no joining fee, no annual renewal fee, and no reward points redemption charge.
You can also enjoy up to 5X rewards on top spends, discounts and offers on dining and shopping, and much more. Apply now to enjoy its benefits!
