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Admit it, we Americans love our credit cards. It’s one of those financial tools that have already been embedded in our daily lives since the ’80s. Its cashless convenience, access to low-cost loans, and cash advances have made these cards our financial crutch in good and bad times, so it’s only natural for us to have the gravitation towards owning one for ourselves. It’s invaluable to have that instant access to cash anytime without the hassle of bothering anyone. I hope this article of ours could answer some of the questions that you have about credit cards because I think even though it suffers some bad press, all in all, it’s a good thing to have so that when the need arises, you’re golden.
How to get a credit card with no job?
Unknown to many, having a job is not a requirement of owning a credit card. You could say that it’s the responsible thing to do if a job is your only income source, but not having one was never a roadblock. What consumers need to know is that a credit card application falls under that “Stated income” category kind of financial product, or what they call a liar loan. They would ask you how much you earn every month but they don’t really verify it. It’s the income that they care about that you bring in, not the actual job at best, at worst, it’s your capacity to scrape off enough to make your monthly payments from everyone and anyone around you. Some of you may say that’s it’s a recipe for personal finance disaster for consumers, and I agree with you on that one, it is, and it feels like a bait by the finance companies to keep up paying interest rates and fees, but it is what is, it’s the world we live in, it’s either we outsmart them in their own game(Plenty of laws and tools are provided to us) or we play by their rules, it’s our choice. The industry is so profitable as a whole that the percentage of the losses coming from bad borrowers is very tolerable to them, or else they won’t keep doing it.
Below is the step by step process of getting a credit card with no job.
Step 1
Check your mail first if you have pre-approved offers. Pre-approval offers are a good thing because it means that they’ve already done a soft pull on your credit report and have categorized you as their target customer so the chances of you getting approved when you apply with them are pretty high.
If you don’t have any pre-approval offers in the mail, you need to do a soft pull on your credit report using different online credit pulling services to see your score. It’s important to only do a soft pull, don’t go to a mortgage or real estate office and have them pull your credit report because that would be a hard pull. A hard pull brings down your credit score by 10 points and shows up as an inquiry on your report for 2 years, a big no-no when you’re about to apply for a credit card.
Step 2
After you’ve pulled your report check what your credit score is. Below are the breakdowns on what you should per credit score range.
629 and below
This is considered really bad credit. Most of the time what’s available for you are just secured credit cards. You need to start building your credit up because most credit card companies would just deny you automatically
630 to 679
This credit score range is considered okay but it’s closer to the lower end kind of okay. There would be some unsecured credit card companies that would approve you but the credit limit would be low, and the APR rates would be extremely high.
680 to 739
This is considered good. Almost all credit card companies will approve you for an unsecured credit card with high to okay APR rates and medium-high credit limits. It’s best that you pick and choose the best one the would fit your goals.
740 and above
On this credit score range, you pretty much have very low rates already and the credit limit offers are on the very high end. At this level, credit card companies are pretty much fighting for your business.
Note: Consumers that have 680 and above credit scores, I suggest to try out all credit cards with pre-approval soft pull options in that way you’ll know the APR and limit you’re approved for first before you submit the actual application and they’d do a hard pull on your report. Here is the list of high limit credit cards that have that soft pull options.
Step 3
When you’re filling up the application, just make sure that what you put on your stated monthly expenses and income is equals to 40% DTI (Debt to income ratio) or below. If you don’t know how to compute the DTI here’s an online calculator that could help. Well, the key takeaway when doing credit card applications is that you need to keep in mind that they weren’t called “liar loans” for nothing. Just read between the lines.
Do credit card companies know if you are unemployed?
There’s no way for them to know that you’re unemployed unless you tell them so. When applying for a new card the only way they could verify your employment is through the name and phone number that you enter on their form. In terms of verification of it, businesses are opened and closed every day so there is no way for them to actually verify if a business is new, old, open or not. As for phone verification, at most all they do is call and ask if so and so works here and if you’re actually making that amount on your application. It could be your mom or even yourself answering that phone there’s no way for them to verify it, all they care about is just making that phone call to cross it out on their approval guidelines, but usually, they never call.
Best credit card for an unemployed person
The best credit card for an unemployed person is broken down into two categories. These categories are the following: Are you an employed person with (1)With extra money and (2)Without extra money? We’ve broken down the following into those two because you’ve got to know on which you fall so that you’d be able to take advantage of each recommended card to the fullest. Below are the credit cards according to the said categories.
With Extra money
If you have a lot of sources of income then it wouldn’t be a problem at all. It’s a question if you have good credit or not.
If you have good credit and up then the following are the best credit cards for you per credit score.
700-749
Chase Sapphire Preferred Credit Card
Blue Cash Preferred Card from American Express
Southwest Rapid Rewards Priority Credit Card
HIlton Honors Aspire Card from American Express
Amazon Prime Rewards Visa Signature Card
750-850
Now if you have bad credit, I suggest the following secured credit cards.
Secured Mastercard from Capital One
Without Extra Money
If you’re unemployed and with no money then it’s very irresponsible to get a credit card if you feel like you wouldn’t be employed for a while, but if you have to, it would really depend on your credit. If you have a 700+ credit score then I suggest to get 2 or 3 credit cards so that you’ll be able to stretch you access to credit and cash until you get a job, but I must warn you that would be really risky and you have to manage your credit really well. Getting a secured credit card would be your best bet if you’re to get one and if you have bad credit. With this one, you’ll be approved for sure plus you’ll be using your own money as security for the lines of credit. Getting overextended on your finances wouldn’t be a problem.
how to build credit without a job?
There are a few options to build credit without a job and you’ve got to identify yourself first if you have extra money to spare for credit building or not. The strategies of building credit without a job with money and without money are way different from each other, so the identification of which type of unemployed person you are would be your first step. Below are the different strategies for both.
With Extra money
If you have extra money and your credit is above 680 then you could start building credit by adding tradelines to your credit report. Now if you’re in a hurry to build credit fast you could always ask someone with an aged (more than 2 years old) high limit credit card with no late payments to add you as an authorized user, then see your credit score go up in 30 to 60 days. If you couldn’t find anyone to add you as an authorized user, you can always go to this tradeline supply company to buy a couple.
Without Extra Money
If you don’t have extra money, one of the options you have if you have a 680+ credit score is to apply for a few credit cards, and volunteer to do the buying yourself in exchange for cash in your family or within your circle of friends. Of Course this one would require a little bit of sweat equity but definitely doable. The other one would be to ask friends and family with great credit scores to add you as an authorized user on their credit cards in that way you’d be able take advantage of the history. In asking someone to add you as an authorized user to their card, so that they could also pass their credit score juice to you, you need to make sure that their amount of debt in their cards is less than 30% of their credit limit, Ideally, it’s aged (2+ years, the older the better) and with no late payments. If you ever find those characteristics of a credit card account and they’re willing to add you as an authorized user then you’re golden.
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