Could it be a positive sign of the economic times? GalTime found credit is on the rebound and card offers could once again start filling your mailbox. But why the change-- even as many Americans are still shoveling out from under debt? And who’s getting these offers?
Credit Worthy Consumers
Banks say they’re only sending out applications for plastic to consumers they judge as “credit worthy." That’s why stacks of card offers have been filling Miranda Marquit’s mailbox, she has excellent credit. “I've noticed a big difference from this year to last year."
Greg McBride from Bankrate.Com confirms that offers are up and issuers have come out of their shells. “They're now back on offense, they are trying to grow their businesses, but they're trying to do so primarily through top credit quality consumers.”
According to McBride, if you have strong credit, you're really in the driver’s seat. If you have a credit score of above 740, now is the time to shop around for:
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Single Digit Interest Rates
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No Fee Balance Transfer Offers
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Cash Back Cards
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Premiere Reward Programs
Pushing Plastic?
Why the credit push? Banks now make more money from swipe fees when people use credit versus debit cards. Banking guru Nessa Feddis from the American Bankers Association says the US financial future is looking a bit brighter than it has in the past few years. “The economy has stabilized. It’s more predictable about who will be able to repay their debt. They've eliminated a lot of the debt that people weren't able to pay.”
Feddis reveals offers could also start arrive in consumer's mailboxes who don’t have perfect credit. “We are seeing them reaching out and testing the waters with people who maybe have had some problems over the economic downturn or who are new to credit.”
Credit Caution
But even if the offers are coming your way, it doesn’t necessarily mean you should take them. Credit experts say as always, compare rates being offered to what you already have.
If you just dug out of being deep in debt, you may want to hold off on extending yourself again, especially if it was a struggle. Financial experts predict card promotions and deals to increase as the year goes on, and banks will start to compete with one another.
Bill Hazelton, founder of CreditCardAssist.com has a word of warning. “I would encourage people to be diligent with their card comparison shopping and, if possible, try to be patient. Marketing by the card issuers this year will continue to ramp up with more aggressive promotions, longer 0% APR introductory periods, lower interest rates and more attractive cash back and rewards features.”
Miranda says she hasn't applied for new credit accounts, but she does like the promotions she’s getting in the mail. “I actually look through them all to see if any of them make sense for me now but I feel like I have enough credit cards so most of them just end up going straight to the shredder.”
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