How to Build a Credit History with American Express
Apply for an American Express Prepaid Card., Apply for a USAA Secured American Express Card., Apply for an American Express charge card., Apply for an American Express credit card.
Step-by-Step Guide
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Step 1: Apply for an American Express Prepaid Card.
A prepaid card functions almost exactly like a debit card; you receive no credit and can only charge what you have deposited in the account.
American Express does not report your transactions with a prepaid card to the credit bureaus and so it will not influence your credit score.
However, American Express does keep an internal record of your transactions with the prepaid card.
If you use the card frequently and consistently deposit money on it, American Express might invite you to apply for a card with more stringent requirements.
For many with low credit, this card might be the only way to get a foot in the door with American Express, but it will not build your credit score.
You will need to build your credit score with other companies to make much progress toward obtaining American Card’s high end products.
Typically prepaid cards are a bad investment because they charge monthly fees and charge for every transaction you make with them.
However, the only fee for an American Express prepaid card is a $2 ATM fee, making it perhaps the best product of its kind on the market. -
Step 2: Apply for a USAA Secured American Express Card.
This card is only available to military veterans and their family members, but can be a great resource for those eligible.
As with other secured cards, you will need to submit a deposit as collateral and your credit limit will only be as high as your deposit.
However, your deposit will accumulate interest (currently,
0.54%) and the card has a low APR of
9.9% to
19.90% with many benefits.If you are eligible, this is a better option than the prepaid card, because it not only establishes a history with American Express, but also builds your credit score.If you use the card responsibly for 2 years, it will convert into a regular credit card., American Express offers several charge cards, such as the Gold Card and Green Card. "Charge card" means that all of your debts are due at the end of the month.
You cannot pay over time with a charge card.This is less of a liability for the company and because of that, average or slightly above average credit will typically suffice when applying for a charge card.
It will not improve your credit score as much as a regular credit card would, but it will establish a history with American Express and has some of the best reward programs available.
For a charge card such as the Gold Card you will probably need a credit score near the high 600s.Because you pay the full balance every month, you do not pay interest on your purchases.
There is an annual fee for American Express charge cards, ranging from $95 per year for the Green Card to $450 a year for the Platinum Card.
A charge card allows you to make purchases and pay them off.
Paying your account in a timely manner will build your credit history.A charge card can affect your credit score when bureaus calculate the frequency of on time payments and the length of credit history.
However, it is not considered in your debt utilization ratio because there are no credit limits for a charge card., A credit card, unlike a charge card, will allow you to carry a balance and pay over time.
Because of this, you usually need a higher credit score to be approved for an American Express credit card than you do for a charge card. (American Express does not release information regarding credit scores necessary to be approved for a card.) American Express offers a range of credit cards, which include various benefits such as travel miles, cash back, or business accounts.American Express has a "Choose a Card" feature that can help you choose which card is right for you.
You may have better chances of being approved for an American Express credit card if you apply for a card through your bank, where you have an account in good standing.
Bank of America, Citi, Wells Fargo , USAA, First National Bank, Barclays, and PenFed all issue American Express cards. -
Step 3: Apply for an American Express charge card.
-
Step 4: Apply for an American Express credit card.
Detailed Guide
A prepaid card functions almost exactly like a debit card; you receive no credit and can only charge what you have deposited in the account.
American Express does not report your transactions with a prepaid card to the credit bureaus and so it will not influence your credit score.
However, American Express does keep an internal record of your transactions with the prepaid card.
If you use the card frequently and consistently deposit money on it, American Express might invite you to apply for a card with more stringent requirements.
For many with low credit, this card might be the only way to get a foot in the door with American Express, but it will not build your credit score.
You will need to build your credit score with other companies to make much progress toward obtaining American Card’s high end products.
Typically prepaid cards are a bad investment because they charge monthly fees and charge for every transaction you make with them.
However, the only fee for an American Express prepaid card is a $2 ATM fee, making it perhaps the best product of its kind on the market.
This card is only available to military veterans and their family members, but can be a great resource for those eligible.
As with other secured cards, you will need to submit a deposit as collateral and your credit limit will only be as high as your deposit.
However, your deposit will accumulate interest (currently,
0.54%) and the card has a low APR of
9.9% to
19.90% with many benefits.If you are eligible, this is a better option than the prepaid card, because it not only establishes a history with American Express, but also builds your credit score.If you use the card responsibly for 2 years, it will convert into a regular credit card., American Express offers several charge cards, such as the Gold Card and Green Card. "Charge card" means that all of your debts are due at the end of the month.
You cannot pay over time with a charge card.This is less of a liability for the company and because of that, average or slightly above average credit will typically suffice when applying for a charge card.
It will not improve your credit score as much as a regular credit card would, but it will establish a history with American Express and has some of the best reward programs available.
For a charge card such as the Gold Card you will probably need a credit score near the high 600s.Because you pay the full balance every month, you do not pay interest on your purchases.
There is an annual fee for American Express charge cards, ranging from $95 per year for the Green Card to $450 a year for the Platinum Card.
A charge card allows you to make purchases and pay them off.
Paying your account in a timely manner will build your credit history.A charge card can affect your credit score when bureaus calculate the frequency of on time payments and the length of credit history.
However, it is not considered in your debt utilization ratio because there are no credit limits for a charge card., A credit card, unlike a charge card, will allow you to carry a balance and pay over time.
Because of this, you usually need a higher credit score to be approved for an American Express credit card than you do for a charge card. (American Express does not release information regarding credit scores necessary to be approved for a card.) American Express offers a range of credit cards, which include various benefits such as travel miles, cash back, or business accounts.American Express has a "Choose a Card" feature that can help you choose which card is right for you.
You may have better chances of being approved for an American Express credit card if you apply for a card through your bank, where you have an account in good standing.
Bank of America, Citi, Wells Fargo , USAA, First National Bank, Barclays, and PenFed all issue American Express cards.
About the Author
Cheryl Torres
Cheryl Torres is an experienced writer with over 11 years of expertise in arts and creative design. Passionate about sharing practical knowledge, Cheryl creates easy-to-follow guides that help readers achieve their goals.
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