If you have excellent credit, you are in the very small minority of consumers who
have been able to maintain top-notch scores in recent years, and as a result, lenders
will extend to you the best credit card offers available. This might be reason enough
to start looking into discontinuing the use of your old credit cards and upgrading
to the new ones available to you.
Often, credit cards for consumers with excellent credit will combine the best features
for a number of cards you might have had in the past into a single, extremely beneficial
Why will you get better terms on your new credit card?
For instance, you might have had any number of credit cards that granted you a low
interest rate on your purchases, came with a great introductory rate, carried no
annual fee or even granted you rewards points, miles or cash back for every dollar
you spent on the account. The general rule of thumb for credit ratings is that the
better your score, the better the rates and benefits your card will offer you.
As a result, in many cases, the best credit cards reserved for those with excellent
credit will offer a few of these attractive features, if not all of them simultaneously.
The reason lenders are so eager to extend you so many great benefits on one card
like this is because your credit score shows that you are generally a good investment.
They know that you're far less likely to run up high balances that you can't pay
off, or miss a payment, than other consumers because you've been avoiding those
issues for years. And again, people with borrowing habits like yours are a very
small minority in the lending community, and those with excellent credit - typically
defined as a FICO rating of between 750 and 799 - are very unlikely to ever fall
seriously behind on payments.
In fact, only 2 percent of that small group is likely to fall 90 days or more behind
on a payment within any two-year period. Compare that with those whose scores range
between 550 and 599, of which slightly more than half are likely to miss three months'
worth of payments. Consequently, many with low credit ratings are penalized by paying
far higher interest rates than you will have to face, and often these cards come
with sizable fees to help lenders protect their investments.
Choose what works best for you
Whenever you're choosing a new type of credit, whether it's a credit card or a loan,
you should think hard about what you want from it, and compare a reasonable number
of the best credit card offers that broadly meet your most important priorities.
For instance, if you fly a lot, you might want an
airline rewards credit card that rewards spending with miles that can be
put toward a number of travel-related perks. Or if you are carrying a high balance,
transfer credit cards with a low APR could potentially save you far more
in interest than the value of the airline rewards that sound so attractive.
Because credit cards for people with excellent credit come with so many perks, it
can be easy to get overwhelmed by the values offered on a number of cards. Therefore,
it's important to focus on narrowing down the features you want so that you find
that card that will have the most benefit before you apply for a credit card.
In summary, identifying your best credit card deals is a question of first identifying
the features and benefits available to you given your excellent credit rating and
then specifically identifying the most important feature or features you use will
actually use your new credit card.
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