Many consumers are curious about rewards credit cards. Rewards credit cards are a special classification of cards in which the company issues credits to the cardholder for various actions. In most cases, the credits come in the form of points. Once the cardholder accumulates a certain amount of points, he or she can use them to purchase goods or services.
Travel rewards credit card companies issue points to their cardholders once they spend a certain amount of money on tickets. The company may also offer the benefits when the customers have traveled a certain amount of miles. The consumer can use the bonus points for discounts on airline ticket purchases or time at a participating hotel.
A travel reward card may have additional benefits and features such as a 0% annual percentage rate, no annual fee, or free balance transfers. Consumers generally need to have excellent credit to qualify for travel rewards cards. An excellent credit score is a score that is higher than 700. Creditors determine one’s credit score by using a calculation that measures available balances, longevity of accounts, payment history, and other variables.
How to get a Travel Rewards Credit Card
The best way for a consumer to obtain a travel rewards card is by applying for another type of credit card first. The goal is for the consumer to gain a strong credit rating by making responsible and timely payments. Building one’s credit score can take approximately six months to one year. After the individual gains a positive credit rating, he or she may wish to apply for a rewards credit card with a major airline.
If the lender approves the card, the individual should use it to reserve airline tickets. He or she can build points very quickly by using the card for each reservation. In time, the cardholder will have a large amount of available spending points. Additionally, by making timely payments, the individual is increasing his or her credit score over time. The lender may increase that person’s credit line, which will allow him or her to earn more bonus points.