Cash rebate credit cards provide consumers with the opportunity to receive a percentage of their total spend as a cash payment. Although there are other factors to take into account, a credit card reward scheme offers a way of making some extra cash from intended purchases. Deals can and do vary greatly, but performing appropriate research and asking the right questions will help to identify market leading credit card with cash back deals. It is important to appreciate that the way credit is managed is fundamental to whether a cash rebate card is the right option.
Eligibility Criteria for Cash Rebate Credit Cards
In order to get approval for the best reward credit cards, a good or excellent credit score is essential. Rising default rates amongst customers have led to issuers tightening their lending and eligibility criteria considerably. As Liz Pulliam-Weston of MSN Money points out: “That means you need to have FICO credit scores of at least 660 to qualify for most run-of-the-mill rewards cards.” Lenders can now cherry-pick their customers so the requirement of a score of 750 or above is not uncommon. It is advisable to perform some credit repair before applying for a reward card in order to increase the likelihood of approval.
How to Get the Best Credit Card with Cash Back Deals
- Pay down debt with savings before applying for new forms of credit. The amount of money owed, expressed as a percentage of the amount of available credit, accounts for up to 30 percent of a FICO credit score rating.
- Apply for credit card reward programs based on careful research. Don’t make too many card applications as each credit search shows for 12-months. Too many searches is likely to lead to rejection.
- Avoid using more than 30 percent of the allocated credit limit on a card. To achieve a better credit score, keep this figure under 10 percent.
- Don’t leave old credit and store cards gathering dust. Rather than closing them down, use them once or twice a month and settle the balance.
- Request a copy of a free credit report and check this for errors. For example, lapsed debts that still show as active or forms of credit that were never taken out. Provided that the appropriate supporting information is provided, this information can be disputed.
Is a Credit Card Reward Scheme Worthwhile?
Whether cash rebate credit cards are right for the consumer depends heavily upon how credit is managed. If the sort of person who carries a large balance forward each month, it is unlikely to be the right choice. This is because the rate of interest on unpaid debt will far exceed a credit card with cash back program. It is essential that discipline is exercised and that cash rewards cards are only used to make every-day and essential purchases.