It’s Getting Harder to Get Credit Cards

This recession has most certainly made credit more difficult to get and credit cards are no exception. Banks and credit card issuers are becoming increasingly more reticent to grant credit to anyone that has less than perfect credit histories.

Granting credit always was a calculated risk on the part of the credit card companies and it is that very risk that has gotten them into trouble now that they are facing record defaults as the unemployment rate skyrockets and more and more people find themselves in debt that they are unable to pay.

Consumers with poor credit histories will not be the only ones having a more difficult time getting a credit card, if they can get one at all going forward. People with little or no credit history will also have a very difficult time getting credit extended to them.

College students as a whole will no longer have easy access to credit cards. As a part of the Credit Card Reform Act anyone under the age of 21 will now need a cosigner or must be able to prove that they have an income that is substantial enough to warrant them receiving a line of credit.

Those people that do have good to excellent credit ratings however, will still be able to get access to credit cards. But in fact, we will more than likely see lower lines of credit extended.

There will also more than likely be less credit cards available through the providers. There is little doubt there will be less credit card providers period. We have already seen Advanta stop issuing credit cards and they were one the largest credit card issuers for small businesses and were in fact, the 11th largest credit card issuer in the United States.

How long this tightening of credit will last is anyone’s guess but it may be a long time before we see the easy availability of credit that we have seen over the past decade.

For individuals with poor or even less than perfect credit but still need a “plastic” option, which is anyone that wants to buy something online or order something from a catalog over the telephone, there are other forms of payment that can be used.

Debit cards and secured credit cards can be used in place of traditional credit cards. Using a stored value credit card allows you to load money onto the card and gives you the ability to make payments anywhere Visa and MasterCard are accepted by merchants by tapping into and accessing those funds.