When it comes to applying for credit cards, especially those through business credit, there are some choice ones you should go for.
However, for every great card, there is equally one that isn’t great.
While the techniques and tips I teach to my Credit Stacking students can cover both personal and business credit, it defeats the purpose if you use those tips for the wrong cards.
Here, I’m going to give you the list of cards and banks to stay away from.
Top 3 Credit Cards to Avoid Applying For
So why exactly would you want to avoid applying for certain credit cards?
A huge reason to avoid certain cards is:
Lack of rewards or points
Lack of or no high limits
Lack of or no 0% interest cards
Let me explain each of these.
Lack of Rewards or Points
One of the big advantages of business credit cards are the rewards and points you can get. This can cover anything from 1-3% on groceries to points on using streaming services.
A huge one is the ability to use points towards travel, which can save you a ton of money on air travel (especially if you do a lot for your business).
In addition, some cards have rewards that give you access to the airport lounge of the specific carrier.
Lack of or No High Limits
Along with rewards and points, another reason – probably one of the most important – to avoid applying for certain cards is the lack of high limit cards.
High limit cards are available for both personal and business, but certain cards won’t go as high as you’d want.
For instance, American Express or Chase can offer $50,000 limits on their cards; hence why these are the cards you should actively pursue.
Lack of or No 0% Interest Cards
Another reason to avoid some cards is the lack of or not having any 0% interest on them.
Guys, interest is the biggest scam banks and financial institutions use against their customers.
It’s a huge waste of money, as that’s usually taken out from your account.
Most 0% interest cards are an introductory offer, however this can be anywhere from 6 months up to 24 months of not paying interest.
Now that you know the reasons not to get certain cards, let’s look at which cards you absolutely avoid.
Capital One
o No reason to build a relationship with them
o Business cards are reported to your personal credit
o Only get the Venture One (if you need it)
Discover IT Business
o Reports to your personal credit
Wells Fargo
o Doesn’t many 0% interest business card options
o Don’t really give out high limit cards
Both Capital One and Discover cards can negatively affect your personal credit score; Capital One pulls from all 3 credit bureaus and several hard pulls in a short period of time can lower your score.
Discover IT Business reports to your personal credit, which is no bueno as the whole purpose of business credit is that it’s NOT reported to the personal side.
While Wells Fargo is okay, their lack of 0% interest and high limit card options is something to be desired.
Is There Any Exception to These?
As with most things, there are exceptions to the rule.
If you’re in a situation where you’ve just started getting credit or you have a broken relationship with some of the top banks, then these bottom-tier banks can be helpful.
Discover does have some good secured cards that can be used to get your credit standing, especially if you’re repairing your credit.
And that’s it. Avoid these cards unless you’re in the above situations. I don’t want you to apply for the wrong cards or make the mistakes I did that will take a while to recover from.
If you want to learn more about business credit and the cards that can truly make an impact for you, don’t wait. Come and join our community.