Student Credit Cards & Credit Card Info Education

Before a college student decides to apply for a student credit card, they should know the basics of credit and how it works. Credit should be taken very seriously and not "applied for" because someone on a college campus is offering you a Frisbee if you apply for their credit card.  You can apply for first time student credit cards at your convenience, when YOU are ready.  We recommend you learn the basics of building GOOD credit before you apply for any student credit cards. A credit card might just be putting the cart before the horse. Be careful when you build your credit as it WILL come back to either haunt you or help you. 

StudentCreditCards.com is an excellent website if you are looking to apply for student credit cards. This site also provides information on building good credit

Click on the card below to visit them.


Using Student Credit Cards in a Responsible way:

Below, and on the following pages we provide you with the information and insights on how to build GOOD credit, as BAD credit can cause you much heartache. The following information is not financial advise, but we do advise you seek the help of a local Financial Advisor if you are in search of professional guidance.

Credit card delinquency could prevent you from qualifying for other types of loans, such as a home loan, auto loan or payday loan. When you miss a payment on your student credit cards, you may receive a call or other correspondence reminding you of your overdue balance. Be sure to pay at least the minimum payment seven days before the actual due date printed on your monthly statement.

Protect Your Credit Record

  • Pay bills promptly to avoid late fees.
  • Keep track of your charges.
  • Do not exceed your Credit Limit.
  • Always avoid Over-limit Fees.
  • Report any change of address prior to moving, this way you will receive your bills right away.

Credit Card Rights

The Fair Credit Billing Act for consumers applies to credit cards and can be used for:

  • Billing errors on your account.
  • Unauthorized use of your student credit card account.
  • Goods or services charged to your account, but not received.
  • Charges for which you request an explanation or written proof of purchase.

*If your card is lost or stolen, you will not be held liable for any changes made by unauthorized persons.

Billing and Charge Disputes

  • If you see an unauthorized charge on your statement, write to the creditor or card issuer within 60 days after the first bill containing the disputed charge is mailed to you. However, if more than 60 days have passed since you were billed for the item, you still might be able to dispute the charge if you only recently found out about the problem.
  • Send your letter to the address provided on the bill. Do not send the letter with your payment.
  • Be specific in your letter. In your letter, give your name and account number, the date and amount of the charge disputed, and a complete explanation of why you are disputing the charge.
  • Keep a record of receipt to document that your letter was received. You might wish to send it by certified mail with a return receipt requested.

If you follow these requirements of receipt, the creditor or credit card issuer must acknowledge your letter in writing within 30 days of receipt and conduct an investigation within 90 days. While the bill is being disputed and investigated, you do not need to pay the amount in dispute. The creditor or student credit card issuer may not take action to collect the disputed amount, including reporting the amount due as delinquent, and may not close or restrict your student credit card account. If there was an error or you do not owe the amount, the creditor or card issuer must credit your account and remove any Finance Charges or late fees relating to the amount not owed. For any amount still owed, you have the right to an explanation and copies of documents proving you owe the money. If the bill is correct, you must be told in writing what you owe and why you owe it. You will owe the amount disputed, plus any finance charges. 

Understanding Your Student Credit History
Check out student credit cards for additional student credit cards and credit card resources.

The "Fair Credit Reporting Act" controls how your credit history is kept, used and shared among lenders and creditors in the USA. It is designed to ensure accuracy as well as the privacy of the information used in the three major credit reports. Two of the three following major Credit Reporting Agencies have credit files on millions of consumers nationwide:

Experian
P.O. Box 2104
Allen, TX 75013-2104
1-888-397-3742

Equifax
P.O. Box 740241
Atlanta, GA 30373-0241
1-800-685-1111

Credit Reporting
Anyone who takes adverse action against you in response to a report supplied by a Credit Reporting Agency – such as denying your application for credit, insurance, or employment – must give you the name, address, and telephone number of the Credit Reporting Agency that provided the report. See www.freecreditreport.com .

  • You have a right to know what is in your credit report, including medical information and, usually, the sources of the information. Make sure your report is accurate.
  • Get your report for free if a company takes adverse action against you based on the report and you request your report within 60 days of receiving the notice of the action.
  • Request one free report a year if you can prove that you are unemployed and plan to look for a job within 60 days, if you are on welfare, or if your report is inaccurate because of fraud. Otherwise a Credit Reporting Agency may charge up to $8.50 for a copy of your report.

If you find inaccurate or incomplete information in your report:

  • Contact both the Credit Reporting Agency and the company that provided the information to the Credit Reporting Agency.
  • Tell the Credit Reporting Agency in writing what information you believe is inaccurate. The information provider must investigate and report the results to the Credit Reporting Agency. If the information is incorrect, it must notify all nationwide Credit Reporting Agencies to also correct your file. If the reinvestigation does not solve your dispute with the company, ask that your statement regarding the dispute be included in your file. A notice of your dispute must be included anytime the Credit Reporting Agency reports the item.

Credit Report Access
Other than yourself, only people with a legitimate business need can get a copy of your report. An employer or a prospective employer can only get your credit report if you give written consent. Student Loans and Student Credit Card Creditors, employers, or insurers cannot get a report that includes medical information without your prior approval.

Duration of Negative Credit Information
A Credit Reporting Agency can report negative information for seven to ten years, and bankruptcy information for ten years. Information about a lawsuit or an unpaid judgment against you can be reported for seven years or until the statute of limitations runs out, whichever period of time is longer.

Choosing Student Credit Card Applications
Visit the student credit card blog for additional resources and credit card information.

Credit terms vary among issuers. When shopping for a card, think about how you plan to use it. Do you expect to pay your bills in full each month, or do you plan to pay off your purchases over time? Consider the Annual Fee, Finance Charges, balance computation method, and whether or not there is a Grace Period for purchases.

NOTE: Some student credit cards do not permit a grace period for the amounts due if you use the Cash Advance or Balance Transfer features, even if they have a Grace Period for purchases. It's also a good idea to look at the Credit Limit and how widely the card is accepted, as well as the plan's additional services and features. Consider and compare all terms, including the following, before you select a student credit card:

Annual Percentage Rate (APR) and Finance Charges
The APR (Annual Percentage Rate) is a measure of the cost of credit, expressed as a yearly rate. The card issuer must also disclose the "periodic rate," which is a rate applied to your outstanding balance to figure the Finance Charge for each Billing Cycle. Some student credit cards plans allow the issuer to change your APR when interest rates or other economic indicators (called indexes) change. Because the rate change is linked to the indexes' performance, these plans are called "Variable Rate" programs. Rate changes raise or lower the Finance Charge on your account. If you're considering a Variable Rate card, the issuer must also provide information that discloses to you:

  • That the rate may change.
  • How the rate is determined, which index is used and what additional amount (the "margin") is added to determine your new rate.

NOTE: Most credit card plans allow the issuer to "reprice" your current APR if the account falls into poor standing or becomes delinquent. Credit Card Repricing is the act of increasing the APR.

Credit Card Annual Fee
Some issuers charge annual membership or participation fees. They often range from $25 to $50, and sometimes reach as much as $100. "Gold" or "Platinum" cards sometimes reach as much as several hundred dollars. These fees may be charged whether or not you use the credit cards.

Balance Computation Method for the Finance Charge
If you don't have a Grace Period or if you expect to pay for purchases over time, it's important to know what balance computation method the issuer uses to calculate your Finance Charge. This can make a big difference in how much of a Finance Charge you'll pay Ð even if the APR and your buying patterns remain relatively constant.

Examples of balance computation methods include the following:

Average Daily Balance: This is the most common calculation method. The issuer totals the beginning balance for each day in the Billing Period and subtracts any credits made to your account that day. While new purchases may or may not be added to the balance, depending on your plan, Cash Advances are typically included. The resulting daily balances are added for the Billing Cycle. The total is then divided by the number of days in the Billing Period to get the "Average Daily Balance."

Two-cycle Balances: Issuers sometimes use various methods to calculate your balance that make use of your last two months' account activity. Read your agreement carefully to find out if your issuer uses this approach. This is the sum of the Average Daily Balances for two Billing Cycles.

The Truth in Lending Act requires a lender to inform you of the cost to borrow, so that you can compare the cost and terms of credit offered by various lenders.

Editor's thought ~ With the many laws which affect credit cards and consumers, a new strong bill headed by Senator Richard Dodd [D], with many other intelligent attorneys and senators, the CARD ACT has been signed into LAW. For Young Consumers: "no tangible gifts to college students in exchange for completing a credit card application;.." This is a good ting because on campus credit card hustlers will not be allowed to hand out gifts, "tangible gifts" in exchange for completing a credit card application. College students and their parents can now learn about credit first, education the student and compare a credit card when they are ready themselves.

   


>CONTINUE TO >PART 2 of our STUDENT CREDIT SECTION.

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