Best way to go about applying credit cards for a newbie

If you are just getting started, there is a sequence of credit card applications that would help while accumulating points. Generally speaking, the cards applications tends to drop over time and you focus on select few that has higher payoffs in terms of giving you points or has exception bonus offers. But at the back of your mind, you might have this pesky thought of this particular card that has been out of your grasp always. This post is a lesson learnt from my experience that can be used by others, especially new comers as they go about applying cards in a certain sequence. The first instinct is to go after the big hitters or the "50k points" cards. That is quite logical given that you can redeem them for higher points or cash back or miles and get the maximum payoff. Usually at the start, there is also lot of big-ticket items to spend on. Beginners have fees, rents, simple spending on items such as furniture or clothes or electronics including the usually expensive laptops/cameras among others.

Why is this important? Banks such as US Banks or Wells Fargo have very stringent credit card lending practices and policies and they scrutinize your credit history more stringently compared to a Bank of America. So it pays to sequence your application. Without much ado, if I had the opportunity to time travel and apply for a new set of credit cards on my as such unblemished credit score/history, I would go with the following order:

1. Barclays Bank: Arrival Plus here and then put some good spending and immediately apply for the US Airways card ( as it is being closed out of this bank entirely ) and hopefully apply for one another card here such as the Lufthansa card.

2. US Bank: Another stringent bank and it is better to apply their Flexperks card off-hand before you go about apping more cards with other banks

3. Wells Fargo: They scrutinize your credit history like nobody's business. Better to apply for their Propel family cards off-hand.

4. Chase/Bank of America/Citi/American Express: All in one go. In a single day, you can just go about apping them after you have sorted out their credit card bonuses

5. Credit unions like the local ones or the national ones - though they are not picky, some like the NASA Federal credit union do look at your credit history for even basic cards.

6. Rest of the gang such as PNC or prepaid cards or Citizens, Citadel, Union or what have you. They are generally eager to snatch your business and would be happy to approve you as long as you are a new customer to them. Sun Trust is one such bank. Though they are well-known for their terrible customer service, which yours truly has experience in several occasions, they are overall flexible with approving accounts. But good luck getting any decent rewards or points with them on an ongoing basis.

Any other ideas that you have or sequence or bank that I have missed?

Max number of credit cards issued by Bank

Is there any limit on the number of credit cards or any cards by Bank? Officially, many banks do not have any explicit policies related to this. Some banks do mention that they are not interested in more than x amount of cards. For instance, I have seen with Capital One and Barclays that they would not approve a third card unless your existing two cards have ample history with them. Some banks go with credit line usage rather than number of cards so they would allot a credit of say $5000 per customer and as long as you are under that limit, you could have 5 cards with $1000 on each. American Express is one of those banks. They deny that there is any limit on the number of cards allotted. They do accept that each customer has his account reviewed periodically and the credit line adjusted. This means they go thru your account history and determine if you need or might use more credit and just up the limit on these cards. Most banks such as Chase or Amex accept transfer credit line requests to another card. With chase, this is breeze. You could email them and voila, it is all set. With Amex and the rest, you have to submit a request and they sometimes make another inquiry into your credit history.

In Flyer talk forums, the Amex gets it limit as 4 - including both personal and business credit cards but excluding the charge cards. Most Amex charge cards are easy to get and they approve immediately but the main difference between charge card and credit card is that the former has been paid in full at the end of billing cycle while the latter, in theory, could be carried over. Of course, carrying balance over to next billing cycle is detrimental to your finance and should be done only if you are getting a 0% APR.

So in a nutshell, Amex has a 4 or 5 card limit depending on income, spending history, your cumulative card limit vs approved credit line among others.

For Chase, there appears no such limit. There are multiple cards that have been approved by Chase. Some daring FT folks claim they have almost all credit cards issued by Chase at one point or the other. I for one, am pretty close to that stage myself.

Barclays seem to have a hard limit of approximately 3. Anything more than that and you are given the dreaded "Your application is under review" page.

Capital One seems to have a hard limit of around 4. They are very region and market specific. So while there are reports to have gotten up to 4 cards if you are in Mid-Atlantic region, north-east users seem to have difficulty in even getting one approved. They seem to have a limit of one or two for west and down south. Which is understandable given they have limited footprint in those areas.

Most credit unions, smaller banks limit you to one or maximum two.

Bank of America, being a big one, seems to not have such limits. There are instances of 5 or 7 credit cards being approved. In general, Bank of America is also the most lenient - that is the consensus.

PNC/Principal/Citizens/Citadel - all seem to have a limit of about 2.

US Bank has about 3 as the maximum number. There are consistent reports where they ask you why you need so many credit cards. Which is ironic given they issue so many partner and co-branded credit cards.

The big bank, Citi, also has a hard limit of about 3. They were pretty generous once upon a time and I have had more than that at one point. But they have cracked down heavily and are issuing way less credit cards than in the past. They are also notorious to randomly close the accounts. So even if you are having multiple cards, I would tread this one with caution. Also, in terms of sign up rewards or redeemable points, both Citi and Bank of America are not really the cream. Though they do have pretty good daily usage cards or simple credit cards which are flexible with not much hassles.

Will cover more banks in future as they come.

Looking around for some cards ..

Sooner or later, you are going to reach a point where you have apped, been approved or rejected, maximized spending of at least one major card from each major bank. The thing is many cards, especially from Amex, come with a lifetime earning of just one time per card. Other cards have a mix luck of again getting approved once you have cancelled it. So make sure when you cancel a card, you do not bad mouth the card or the bank! These details are all captured these days ..so I was looking at what next card to apply. I saw a bunch of cards in this blog as well as other blogs which had the standard rooster. One thing that was lacking was a list of cards by bank. By which I mean, take a bank, and these are the available cards that are there. Of course you can go to the bank website and view them all there directly :) .. But I am not going to list all cards here. Rather just some cards that are relatively better compared to the rest.

So this post will just detail few banks and some of the cards that are good/flagship products and are ideal candidates for you to churn periodically.

Citi:

AAdvantage card

I would argue that this is the best card that Citi has .. compared to their flagship "Thank you"
flavors such as Premier or Preferred cards. Their 2% Cash back card is also pretty good if you are interested in no hassle, just 2% return on all purchases.

American Express:

Their prepaid cards such as Target Redcard ( wait till atleast 2015 end), Bluebird, Serve card are must have cards.

Charge cards here are pretty good including the Platinum cards and Gold cards.

Credit cards here are the best for SPG card, Jetblue card and the Blue Preferred card.

Chase:

IHG Rewards 80k points offer - The 60k points offer is in chase.com

Marriott has a 50k points offer too. Those are handy for Towne Suites or Residence Inn where you will get more bang for your points.

All Cards - No harm in applying most of their cards .. it is useful one way or the another but cards such as Amazon or IHG/Disney/Marriott are highly specific to those brands. Are they really that useful apart from your one time usage, I would tend to say No.

The best card here is the Southwest card which can be directly found in Chase website. There is Simply no better offer outside. Though it has a $99 annual fee, it is much worth more if you travel southwest frequently. They pretty much fly the whole of US to all the major cities.

US Bank:

Flexperks card and the Select card are pretty good. This bank is notorious to look at more than the three major credit bureaus before deciding whether you their credit worthy. They do have many airlines card but no stand outs. The best card here would be the Club Carlson Cards. They come in two flavors of $75 and $50 each in annual fees.

Barclays:

US Airways : Last few days to apply this card as soon Citi would be managing this one.

Arrival Card

All Cards : Some of the cards like LL Bean or Apple cards are really not that worth applying unless you frequent those places.

Wells Fargo:

They have  good customer service. I would be inclined to look at the propel card family for their a) Amex brand b) decent features and points

Bank of America:

Cash rewards card is the best here. I would definitely give a look to their airlines card such as the Alaska Air card or the Virgin Atlantic card.

Best Cards of 2015 as of January

Hey all! Here we are in the new year! A new beginning in our journey to collect points and travel. 2015 seems to be a good year based on the positive buzz being generated around various credit cards/checking accounts and generally any kind of banking relationships. There is increased focus on consumer activities and generous targeted bonuses are doing the rounds. The marketing teams in big financial firms are creating their strategies in attracting more customers with bigger incentives than ever.

Some examples: Barclayscards US, which has been issuing the US Airways card for US Airways has increased the sign up bonus to attract new customers before this business is handled by Citi post merger of US Airways with American. Barclays will still continue to maintain the existing accounts and hence there are a lot of initiatives to target customers.

Barclays card here: http://www.worldgotbigger.com/us-airways-credit-card/?campaignId=2062&cellNumber=8&referrerid=PTRBAEMWELG

Note that Citi gives a similar card for American but that also has a $99 annual fee.

Chase, as usual has some exciting cards, primarily:

Chase Southwest card: Again started with the 50k points offer after 2k spend.

Chase Slate Card: I have not tried this card yet but it seems a standout primarily because there is a 0% APR and ZERO FEE BALANCE TRANSFER .. balance transfer fee is the transaction fee that is typically 3% or 4% of the transaction amount and makes a significant change. Chase Slate waiving of this fee makes it the only card, apart from the Navy Fed CU GO card which waive the balance transfer fees. That is a huge savings there if you want to transfer over the balances. I am planning on doing this sometime this month. Fingers crossed on getting approved.

https://creditcards.chase.com/credit-card-search.aspx?F42G=Y71UH0&CELL=63WS&jp_ltg=leftnav&list=4,2,1

There are reconsideration lines which are rather soul draining and honestly not worth that much given that there are so many offers available that are not limited to just one bank these days.

Over the course of this year, this blog will start having posts that are not just limited to credit cards but also other kind of financial services as well as evolving into a money blog. Not that we are going to post stock tips here but would post different strategies that are out there and try to split the wheat from chaff. A lot of noise in financial world and jargons are very difficult to lay man as well professionals to comprehend completely. On top of that there is often subliminal data to convince people that a particular strategy or solution is the best one. This blog would try to distill some of these thoughts and ideas and have actionable items that would make this whole exercise less stressful. Same way, managing credit cards offers and spending is one of the prime goals of this blog.