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Easy access to credit cards thanks to high competition and instant approval online forms. Is it good or bad for consumers?

(PRWEB) January 11, 2006 -- The trend is getting bigger and bigger as younger adults enter the job world to accumulate credit cards. The new generations worldwide have grown up with computers. It is almost more "natural" for them to search on the internet than to go to the nearest bank. However, easier and faster does not mean better:

First applying for a credit card instant approval and filling the credit card application are two different processes. The approval of a credit card does not necessarily mean that such a card would be delivered fast. It only suggests that the person is qualified to apply for a credit card. The credit card application is the next step once the "go signal" has been given by the online bank.

Also, it is impossible to get an instant approval if the credit record is not spotless. This approval is only targeted at customers with good credit records. However, because of the competition between banks, a new factor is emerging: Because of the high credit market today, banks are willing to stretch their limits and offer an instant approval program to a wider spectrum of people. This entirely depends on the bank selected to apply the credit card on.

Most banks nowadays provide customers with a credit card application form online. Theoretically, most banks are securing the data and keep them confidential. However, beware of internal employee fraud, (it happened). The information needed is seriously confidential: name of the applicant, current address, social security number, and previous addresses over the years.

This is the most common information asked. It can even be more detailed, such as salary level.

The trend today is to get as many credit cards as possible. With rising living costs, it is handy to get a free reserve. However, some figure are scary: in North America, the average number of credit cards per household is said to be 7 with a recurring balance of 13.500 USD.

How is it possible to pay it back? Often, a second mortgage on the house is taken to clear all the credit cards. Problem is, soon the need of extra cash is back, and a new application is filled out. So faster, is not always better.

Francois Marin
Financial Advisor
http://www.refinance-solutions.info



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Yes, low APR credit cards are on the rise. Many credit cards are competing for your business to give you the best and lowest rates available today. There are so many credit cards from you to choose from that they are doing all kinds of things to get your attention including lowering their interest rate and giving you no annual fees.

Why is this happening? Because there are so many credit card companies. They all want your business and this is an attractive incentive to get you to apply and own one of their credit cards. If you choose a low APR credit card over one with 19.99 percent you are sure to go with the lower APR.

The only problem is that sometime these 0% and low APR credit cards are only promotional ways to get you to apply and then later your interest rate will rise. Many credit card companies have low APR credit cards for a certain amount of time such as 3 months, 6 months and some up to one year. You will have to compare to find out which one keeps the lower APR after the promotional period to ensure you are getting the best deal around.

No matter what the reason low APR credit cards are here to stay as long as the companies are competing for your business. Just remember to compare everything they offer besides the lower interest rate. You may find that several credit card companies are now offering other wonderful incentives for you to apply with them such as reward programs.

No matter which company you choose, you will enjoy the low APR credit cards even if it is only for a limited time. You will be able to save money on your purchases because you will not have to pay any interest until the promotional period is over. Just be sure your balance is very low when the interest rate kicks in and you will be fine.