When looking at all the travelers at the airport, you may wonder how they pay for it all. Naturally, there’s always the busy business people that have a corporate credit card footing the bill. However, there are everyday folks hopping on planes to exotic locations several times a year. Many travelers want a frequent flyer or miles credit card to benefit from all the perks, such as bonus miles or lounge access, providing cheap travel all the time. However, many people have credit scores that aren’t high enough to qualify. To improve your chances when applying for a miles card, fix your credit with a few simple steps.
Check Your Credit History
Your credit score is the value card companies look for when qualifying you for an account. Traveling cheaply is a benefit of responsible borrowers, so maintain a score higher than 700, if possible. Achieving this score requires diligent credit management. Access your credit report at least once a year to see if there are any unusual listings. Accounts opened in your name that you aren’t aware of could be a sign of fraud or identity theft. Protest any accounts or issues that aren’t correct to clean up the history.
Maintain Low Balances
If you have a $10,000 limit on a typical credit card, keep your balance well below $2,000. Your score improves when you have a lot of available credit. If you maintain a high balance compared to your limit, the score actually dips. There isn’t a lot of credit available, making it look like you are living beyond your means. Mile cards are meant to help you travel on a budget, not to place you in more debt. You will only qualify for these cards if you show purchasing responsibility.
Pay on Time
It sounds like a simple idea, but it’s crucial to pay all your bills on time each month. Even one late payment causes a decreased score. If you have other credit cards, try to pay more than the minimum payment amount. You want to pay down the balance as quickly as possible to improve your score and qualify for cheap travel through mile cards. Interest rates also drop with lower balances. Avoid balance transfers, however moving debt around doesn’t help your score like paying the balance down.
Your sister or other relative may be your best friend, but avoid co-signing on any loans. You can’t travel the world cheaply with a mile card in your hand and a huge debt you’ve promised to pay back to another person. If that person defaults on the loan, you must pay it back in full. Depending on the amount, you may not be able to pay it. Your credit score ends up being adversely affected, disqualifying you from any lucrative travel cards in the near future.
Choose Credit Cards Carefully
Every time you visit a store, it seems like they always offer a credit card application. Don’t apply for every card offered to you, especially boutique-type stores. Each time you apply for a card, your credit score drops slightly. If you’re trying to improve your score through credit card use, only apply for one or two cards that are accepted almost anywhere. You’ll have more options to use them and improve your credit simultaneously. That mile card will be easier to obtain as you charge items on other cards and pay down the balance.
Other Debts Count Too
Paying your credit cards on time are not the only debts that count toward your score. Student loans, mortgages, rent and utilities all count toward a good credit score. Essentially, they all combine to show your responsibility profile. Mile cards allow you to travel cheaply because you’ve earned the perks they offer. Keep all your debts current to see the score rise. If you have any joint accounts with someone else, those debts also count. However, it’s best to only have accounts in your name to control the on-time payment schedule.
The Eventual Benefits
Although every credit situation is unique, you’ll eventually be eligible for a mile card when your credit score improves. By that time, you’ll have the responsibility level necessary to handle the card wisely. Your perks add up as you use the card and pay it down. Save up the points or miles to travel for almost no money at all! You’ll discover the world with an approved credit line and smart spending.
Experts at MileCards.com advise that though it may take several months or even years to qualify for the best miles credit cards, but it’s worth the time. With good credit and a trusty card, you can improve your entire financial outlook with diligent budgeting. From buying that new car or investing in real estate, good credit leads to perks on credit cards and in life.