If you are unsure about your credit rating, MasterCard from Capital One offers help in assessing which offers are best for you.
Most credit lenders advertise the bonuses and features of the credit cards they offer but don’t provide guidelines for consumers to help them know which credit cards they can qualify for.
You may not know what is meant when lending banks say their credit card is “for those with good credit” or “APR depends on creditworthiness of applicant”. What is considered “worthy”?
You might simply apply for any card that appeals to you due to the interest rate, terms or the rewards program attached to the account.
That can further harm your credit file if you are applying for and being rejected for one credit card after another.
Capital One has taken some of the guesswork out of choosing which credit card accounts to apply for. Their website provides clear and concise information about the APR for each credit card offer and any annual feels associated with the card.
Each MasterCard issued by Capital One gives consumer information on the credit rating required to be approved for that particular credit account.
Labeled and color coded, Capital One offer a credit standing that is needed to obtain the card, such as:
- Excellent Credit
- Good Credit
- Average Credit
- Limited Credit
In addition, there is a pre-qualifier page on the Capital One website where you can get a quick estimate of whether you will qualify for a certain offer.
This pre-qualification page is not a guarantee you will qualify for a certain card but can tell you if you will not quality with placing a mark on your credit report.
If you are uneasy about what your credit standing is, the pre-qualification can be extremely helpful to you.
Only those credit cards listed for “excellent credit” have low interest rates and 0% introductory APR. When included, the 0% offer is good for one full year.
The APR applied to credit cards requiring excellent credit are 11.9% and 14.9% which is far below the national APR average today. Those cards have no annual fee attached.
If you have “good” credit the variable rate APR will be 16.9% and you will have the option of a 0% introductory rate for 12 months with no annual fee. The most common card in this category is the No Hassle Miles Rewards account.
Consumers With Average Credit Are Charged…
Consumers with “average” credit are charged the higher interest rates at Capital One. They will pay an average of 19.8% variable APR and the rate may be as high as 24%.
There is no transfer fee for balances transferred to the card but most of the credit cards available to those with average credit ratings carry an annual fee of $39. 0% introductory rate on the “average” accounts are available but for 9 months rather than for one year.
MasterCards from Capital One that accept “limited credit” are not for consumers with bad credit. Limited credit accounts are available mainly to college students and to those who have not established a credit file.
For the young adult, limited credit can be a real problem when trying to rent an apartment, get insurance or buy a car. No one has credit until they establish credit.
As you might expect, this card offers that approve applicants with limited credit carry high interest rates of 24.9% variable APR. They also have a $19 annual fee which is waived for the first year.
Advantages
The variety of options makes this credit card a top contender in the credit card marketplace.
Once known for providing credit even to those consumers with shaky credit ratings, Capital One has adjusted its focus since new credit lending laws took effect.
Knowing what level of credit rating you need to be accepted for a certain credit card can save you from wasting time applying for credit you will be denied.
It also saves you from further damaging your credit by having too many inquiries sent to the credit rating agencies.
The pre-qualification page is not cast in stone. You may be declined even though your pre-qualification indicated potential approval.
However, this is less likely to happen than with other credit lenders who provide no guidelines on what is expected of consumers applying for a certain account.
Disadvantages
If you have average credit you may be able to find better interest rates with other banks. The 24.9% variable APR for average credit is quite high and adding on an annual fee provides a credit card that is quite expensive to use.
If you have a limited credit history due to just entering college or the workplace, the fees are reasonable. With annual fees waived for the first year, you have a chance to build a good credit file and could qualify for better terms at the end of the first year.
Conclusion
The Capital One MasterCard offers consumers real help in choosing the right credit account to apply for. A pre-qualification that is not reported to credit bureaus and credit card applications that clearly state what level of credit is required for approval makes Capital One an excellent credit lender in today’s shaky credit market.
