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How to get a credit card
Credit cards are a financial tool that allow cardholders access to a credit line, meaning they may make purchases that they then pay off later. Credit cards also offer a way to build credit history. But before an individual fills out an application for a credit card, there are several potential factors to consider — from different types of credit cards to approval requirements to possible associated risks.
In this guide, learn about the basics of credit cards, including their potential terms, fees, requirements, and more.
What to look for when applying for a credit card
Anyone new to credit may wonder how to apply for a credit card. Though applying for a credit card can often be done online or at a financial institution in just a few minutes, there are many elements to evaluate beforehand.
Learn about credit cards and their terms
Fees and interest rates are normally the first things to know about credit cards.
For example, some credit cards charge annual fees — which is a yearly expense individuals pay to use a credit card — while others don’t.
When it comes to credit interest, the average credit card interest rate is above 20%.1 Consumers who pay off the entire balance each month on time typically won't have to worry about interest, but anyone making just a minimum payment or carrying a balance likely will. There also may be penalty fees for individuals who miss payment deadlines.
Credit card or not, spending within one’s means is essential. Not sure where to start? Try a personal budget.
Check your credit score
Financial institutions generally don’t disclose credit score requirements for all credit cards, but providers often offer credit cards for a variety of scores. For example, scores above 670 may qualify someone for certain credit cards that offer bonuses or sign-up perks.2 However, there are generally many cards that are available for those with scores below that number. Some providers also offer specific credit cards for low credit scores or those looking to begin building their credit.
Individuals can receive a free credit report once a year and may be able to check their specific credit scores from each of the three credit reporting agencies via their websites or associated apps. Some credit card providers may let cardholders check their score within their account as well.
Applying for a credit card will typically trigger a hard inquiry, which can affect a person’s credit score. Be sure to consider credit score requirements before applying for any form of credit.
Types of credit cards
Though many credit cards operate similarly, there are different types of credit cards available. Some common cards include:
- Cashback cards. When making purchases with a cashback credit card, cardholders can earn money back on eligible purchases. For example, the PayPal Cashback Mastercard® offers 3% cash back3 on PayPal purchases when the PayPal Cashback Mastercard is used for payment.
- Travel rewards cards. With travel rewards cards, consumers can earn points or miles that can be redeemed later for flights, hotels, car rentals, vacation packages, and more.
- Store rewards credit cards. Some credit cards are tied to specific store loyalty programs. This can allow people to earn points whenever they charge an eligible purchase to their card.
- Secured cards. These cards require a form of collateral, normally a cash deposit that acts as a security deposit and/or credit limit. A potential benefit of this type of credit card is that it may be used to help improve someone’s credit score.
- Student cards. Student credit cards generally lack premium perks, but they usually have no annual fee and lower requirements for approval.
Potential credit card requirements
What is needed to apply for a credit card? Credit cards typically have basic requirements that applicants must meet to be approved.
Here are some potential examples of information and documents required for a credit card application:
- Be at least 18 years old
- Be a U.S. citizen
- Have a U.S. address (P.O. boxes do not qualify)
- Have a Social Security Number (SSN) or Individual Taxpayer Identification Number (ITIN)
- Income that meets the card's requirements
- Qualifying credit score
Submitting a credit card application
A simple way to submit a credit card application is through an online portal. While the process will vary depending on the credit card provider, the steps may look like this:
- Select a credit card.
- Find and click the “Apply Now” button.
- Enter the required personal information.
- Provide personal or household income (if required).
- Submit application.
It's also possible to apply in person at a physical branch of the card provider. The financial institution may require proof of personal information and any stated income.
Note that not all applications will be approved. Every provider uses its own criteria to determine who will be approved. On the flip side, individuals may receive approval almost immediately, depending on the credit card issuer.
It’s important to consider one’s needs and financial means before applying and using a credit card. Ensure understanding of any terms, conditions, and potential fees. Missing payments, carrying a balance, variable interest rates, and more can potentially lead to growing debt and damage to the cardholder’s credit score.
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How long does it take to get a credit card?
Assuming the applicant is approved, they will typically receive their new credit card within seven to 10 business days. Some premium credit cards with a high annual fee are often expedited, so getting a card in one to three business days is possible. Some credit card providers may even make virtual cards available immediately upon approval, so individuals can start using the card right away. Timing will ultimately vary depending on the credit card, the card issuer, and even applicant location.
How to get a credit card for the first time
Anyone looking to apply for their first credit card should consider how they plan to use credit and their goals. While credit cards can be a tool to help establish a credit history, credit card holders are still borrowing money that needs to be paid back. Those who use credit should practice responsible spending, make timely payments, and pay their full balance on time each month to avoid potential interest charges.