Getting your child a credit card is a huge step and comes with plenty of potential complications. Find out the pros and cons and how to get started.
What are instant approval credit cards?
Instant approval credit cards, sometimes referred to as guaranteed approval cards, are a convenient way to take the guesswork out of the application process.
Instant approval simply means that when a person applies for a credit card online, he or she receives a quick decision, typically within a few minutes.
When an individual applies for an instant approval credit card online, the issuer runs a preliminary credit check.
Generally, applicants with higher credit scores are more likely to get approved for the card. As soon as the credit card issuer receives the score and approves the application, it usually issues a conditional approval as it performs an in-depth review of the applicant’s credit history.
Credit card companies typically determine the creditworthiness of applicants by looking into their financial backgrounds, including their income and past credit card usage.
In addition to the eligibility requirements, applicants are required to provide some personal information on their application. Some personal information that the card issuer requires includes:
- Proof of identity — Applicants are required to submit proof of identity, such as a Social Security number.
- Personal information — Applicants have to indicate their full name, contact details and residential addresses in an online application form.
- Income and employment — People also have to provide any proof of employment or income, which includes the details of their employer.
- Balance transfer details — Those applying for a balance transfer may have to provide the details of their existing account and the amount they are transferring.
To ensure a smooth and fast application process, applicants should have the above-mentioned details on hand before starting the application.
Instant approval credit cards generally are not for people with bad credit scores. Discover notes that applicants need to have good to excellent credit for instant approval.
People with bad credit histories should work on improving their credit scores or consider other options, such as a secured credit card. Because rejected applications can negatively affect a credit score even further, it is important to consider these conditions before starting the application.
Instant approval credit cards example
People looking for quick credit online should consider researching reputable companies that offer credit cards at reasonable interest rates.
Check the legitimacy of the company with the Better Business Bureau or a similar organization. A number of websites for instant approval credit cards advertise several offers of credit, so people should compare them carefully to determine which are the most attractive and have the lowest interest rates.
Also, watch for application fees, annual fees and unreasonably high penalty fees.
If you’re taking a vacation this year, you should have one of these types of credit cards in your pocket.