Are you interested in obtaining a credit card and not sure which type to get? Believe it or not, all credit cards are not created equal. During the first three months of 2014, more than 990 credit card offers were sent out – an indication of how many different types there really is. Depending on the type of credit card you get, there are differences in interest rates, fees and various options. Choosing the right credit card involves research, knowing what you want in a credit card and what’s available out there. Read this informative guide on what to look for in a credit card offer.

Type of Credit Cards Available

There are several types of credit cards being offered. Before you know what to look for in a credit card, it’s important to know what’s available. Here are the most common types of credit card offers.

• Balance Transfer Credit Cards – These are the most popular credit cards because they allow borrowers to transfer balances from other credit cards onto this card. In many cases, transfer credit cards come with a 0% interest rate on purchasing for the first year. Although the upside of these cards is that they allow borrowers to pay off other credit cards, the downside is that they often card a transfer fee, which can add up to a substantial amount.

• Convenience Check Credit Cards – These cards come with checks that consumers can write that are tied to credit cards. While convenient, they often come with a higher interest rate.

• Cash-back or Rewards Credit Cards – These credit cards have been very popular since they first came out in the 1980s. They give back cash, often up to 5%, on every dollar spent on purchases. They often specify what type of purchases they cover, e.g. groceries, gasoline, home improvement supplies, etc. Some also give airline miles or points to be used towards other purchases.

• Secured Credit Cards – This type of credit card is typically used by individuals with no credit for those who have bad credit but are trying to rebuild their credit. The borrower generally has to put some money into an account to be used as collateral or security. Secured credit cards generally have a higher interest rate.

• Gas Cards – These credit cards are used for purchases at gas stations. They’re usually either general or brand-specific, which means consumers must make their purchases at a certain brand of gas station. Both offer rewards or rebates based on the gas and/or merchandise purchases that were made that month.

• Basic Credit Cards – These are what the name entails. They’re a basic credit card that allows consumers to make purchases and pay the money back in monthly installments. They don’t offer rewards, rebates or cash back. Interest rates on basic credit cards vary from low to extremely high, depending on the card and the issuer.

• Brand-specific Credit Cards – This type of credit card is used at specific places of business such as hotels, restaurants, department stores and can only be used at that specific store or establishment.

What to Look for in a Credit Card Offer

What a consumer looks for in a credit card depends a lot on what the card is needed for as well as their spending habits.

• Interest Rates – This is probably the most important thing to look for in a credit card because it can make a big difference in determining the monthly payment. Consumers are often shocked when they see their final balances, which are much higher than their initial purchases. Ask these three questions.

1. After the initial low interest rate, who much will the interest be?
2. How long does the 0% or low interest rate last?
3. Do they offer a fixed or variable interest rate?

• Annual Fees – Many consumers get credit cards with low interest rates only to discover later that the card is bombarded with various high annual fees. Some charge processing fees, servicing fees, activation fees and more, and these often more than make up for the low interest. Prior to signing up for a credit card, consumers should double check about annual fees.

• Credit Limit – Consumers who only need a credit card for occasional use are not going to be too concerned about the credit limit. On the other hand, those who have a large purchase in mind are going to need one with a larger credit limit. However, new borrowers or those who might be compulsive shoppers should start off with credit cards that have a low credit limit to avoid getting too far in debt.

• Know the Fine Print - When choosing a credit card, interest rates may be the single deciding factor to the consumer. In fact, many consumers check interest rates and nothing else when applying for a credit card However, just because the credit card comes with a low interest rate doesn’t mean that it’s not going to get their money some other way. Consumers should read all the fine print before signing their name on the dotted line.

1. Are they charging fees for cash advances?
2. Do they allow transfers?
3. What type of late payment fees will there be?
4. What about over-limit fees?
5. What type of transaction fees do they carry?
6. Are consumers automatically enrolled in credit protection services?

• Grace Period – The grace period, which begins on the day consumers make a purchase and goes to the day it begins accruing interest, can also play a big part in how much consumers end up paying for credit card purchases. Believe it or not, some credit cards have no grace period, which means they begin charging interest on the same day purchases are made. What makes this unattractive is that it makes it very hard to pay these credit cards off because they’re constantly accruing more interest. Consumers should look for credit cards that offer the longest grace period.

Summary

Credit cards can be a very helpful financial tool when used properly and in conjunction with good spending habits. Hopefully, this article can help consumers make wise choices not only when using their credit cards but also when choosing a credit card. They should keep in mind that just because a credit card company is advertising that they offer the best credit card is no guarantee that it really is the best or the best for them. Another point to remember is that the best credit card offers do not have to send flyers in the mail to get customers – customers come to them!

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