Most credit card lenders take a traditional approach to applications while Household Bank provides an interesting alternative.
When you apply for a new credit card with a traditional credit card application, you are applying for a particular card with set terms and conditions.
When you submit a credit application on a traditional application it will be approved or denied.
Either way, the request for a credit rating and a record of the application is on your credit file. This is important as it is your creditworthiness that determines acceptance by the lender.
You may be tempted to apply for a card with the best terms only to find only those with perfect credit can qualify.
Household Bank (HSBC) operates in a different way. The goal is to offer you a credit card that will suit you based on your application, qualifications and credit report.
Shaky Credit?
If you think your credit is shaky, this is a good option. You may or may not be granted the credit card you initially applied for but there’s a good chance you will be offered some type of credit card account.
Rather than applying for several credit accounts in order to be approved for one, you need to make only one application for a Household card and wait to see what the lender offers.
You might be offered an unsecured credit card and it may include a 0% introductory APR or a rewards feature. The offer is determined before your application is fully processed and you are offered terms for a credit card Household Bank feels you qualify for.
If the credit offered has terms and APR you can accept, your applications is fully processed and the card is issued. The terms of the account are clearly provided as well as the APR that will be charged and any fees the might apply.
The MasterCard from HSBC has competitive interest rates of between 12.99% and 19.99% which is determined by your credit history and carries no annual fee.
Those who qualify have a choices of Household Bank Platinum MasterCard accounts with reward choices of cash back and
plus rewards which adds merchandise to the cash back and flight options. There is also a non-rewards card that is simple and straight forward.
Advantages
If you are unsure of your credit rating or know you have some black marks in your credit file, HSBC is a good credit card to apply for. Chances are you will be offered a new credit card.
It may be the MasterCard with the rewards programs you requested. However, if you don’t qualify for a standard credit account you will be offered a secured credit card.
Secured credit cards are useful for rebuilding damaged credit. The Household Bank Secured MasterCard has a $35 annual fee. You choose the spending limit by the amount you deposit to this card.
It may be as little as $300 or up to $5000. You have the same online account management as other unsecured HSBC credit accounts and your card can be used worldwide wherever the priceless MasterCard is accepted.
If HSBC offers you only the option of a secured card, it is due to bad credit or insufficient credit history.
The card is not identifiable by a merchant as a “secured” card and you are establishing a savings account as collateral for the credit card.
The value of a secured card through HSBC is that they report to credit rating bureaus regularly.
Requirements for a secured card are minimal and include:
- Legal age in state of residence
- Home telephone
- US resident
- Valid Social Security Number
Disadvantages
HSBC is a huge financial organization that has long been well known in Europe Asia. HSBC stands for Hong Kong and Shanghai Banking Corporation. The purchase of Household Bank several yeas ago led to rapid growth in the credit card market in North America.
There is no annual fee for the standard MasterCard from Household. However, this does seem to change frequently and it’s wise to ask whether the fee has been waived for the first year only or if there is $0 annual fee.
There is no guarantee of approval or even that you will be offered a secured credit card. The approval rate has been judged as average with only those nearing a credit rating of 700 can assume they will receive the account and reward terms they applied for.
If you have little credit or feel your credit is good or better, this is an excellent credit lender.
However, if you know you have a low credit rating it would be better to compare the terms and fees for other lenders who offer secured credit cards before making application for a MasterCard issued by Household Bank.
Summary
Household Bank is a trusted lender backed by the huge financial clout of HSBC. Applications are processed quickly and the lender prides itself on simple to understand terms, online management tools for your account and on tailoring account to fit your qualifications.
