As a new immigrant, you are usually contending with at least one major hurdle when it comes to getting credit. It is normal for those first arriving in the United States to have absolutely no credit history with the American credit bureaus. Without a credit history, many lenders will be hesitant to give you a card even if you have a decent income. Luckily, the Petal Card is different. It’s a pretty solid option for immigrants or anyone with no existing credit history. Here’s a look at what the Petal Visa Card has to offer.
No Credit History Needed
The biggest reason the Petal Card is a great option for new immigrants is you can apply even if you don’t have a credit history. It’s designed to help people build their credit. Instead of evaluating your credit history, Petal looks at other details. For example, the company might examine your bank account transactions to see if you are financially responsible. If you don’t overdraft your account, maintain at least a small buffer, and have money coming in regularly, you have a decent chance of being approved.
Now, it’s important to note that, while Petal Card doesn’t have an issue with a non-existent credit history, the company does still perform a hard pull on your credit. This allows them to factor in any credit history details that are available. The card focuses on people without much credit history, not borrowers with poor credit. If you have negative items like bankruptcy, missed payments, or anything similar, you might not be approved.
Petal Cards Are Unsecured
The Petal Card doesn’t require a deposit, even if you don’t have much credit history. You can get an unsecured credit card through the company, which eliminates the need to send a large chunk of money as a means of getting a card.
The Petal Card is Fee-Free
With the Petal Card, you won’t get stuck with the high fees that often come with cards for those with no credit. The company doesn’t charge an annual fee, maintenance fee, late fee, fee to add an authorized user, or foreign transaction fee. Aside from interest, it’s an entirely fee-free option.
Competitive Interest Rates
While the Petal Card doesn’t qualify as a low-interest card, the rates are pretty reasonable for a credit card meant to help people who are new to credit in the United States. The annual percentage rate (APR) you receive should come in between 14.74 percent and 25.74 percent, making it reasonably competitive, especially on the lower end.
Potentially High Credit Limit
Cards for credit newbies usually have fairly low limits. While you might only get a $500 credit limit with the Petal Card, it’s possible to get one as high as $10,000.
Precisely what limit you get will depend on a few factors. Usually, this includes your income level, debt-to-income ratio, your housing costs, and credit history (if you have anything on your report already). Petal will examine your situation and determine an amount that it believes you can handle responsibly.
Credit Card Rewards
Many cards for people without credit histories don’t come with rewards, especially if they don’t charge an annual fee. However, the Petal Card is different. You can earn 1 percent cash back on eligible purchases, and you might be able to make more through good behavior.
After you make six on-time payments, you might be able to start earning 1.25 percent in cashback. Keep that up for another six payments, and that rate goes up to 1.5 percent. Those on-time payments don’t even necessarily have to be in a row, which is a pretty nice deal, and they don’t have to cover your full balance either.
Pre-Approval Available
If you want to see if you have a good chance of being approved, you can go through the Petal Card pre-approval process. This allows you to input some financial details and see if you are likely to qualify without a hard pull on your credit. Essentially, you can figure out if you are probably going to get approved before you take actions that impact your credit score. If you are, then you can move forward with confidence. If not, then you can stop short of applying, leaving your credit score unaffected.
Three Bureau Reporting
The Petal Card reports your activity to all three credit bureaus. By doing so, your credit history is built up at all of the bureaus simultaneously. This is incredibly beneficial for new immigrants who don’t have any history. You’ll now have a credit record at Equifax, Experian, and TransUnion with one card.
Set Your Own Purchase Limit
If you want to make sure you handle your Petal Card responsibly. You can set a purchase limit that is less than your credit limit. You won’t be able to make purchases beyond the limit you set. Thereby, ensuring you always have some credit available.
Since your credit utilization ratio has a big impact on your credit scores. This is a great feature. You can essentially force yourself to behave in a financially smart fashion, increasing the odds that your score will rise.
Ultimately, the Petal Card is an excellent option for new immigrants who don’t have much credit history in the United States. For the card category, it offers competitive interest rates and credit limits. Plus, it’s entirely fee-free. You can earn cashback rewards too. While you might not want to use it forever. The Petal Card is a solid choice for building your credit. Also, for increasing the odds that you can get approved for something better down the line without the drawbacks of many credit cards for newbies.
Do you know of another card like the Petal Card that is a great option for new immigrants or anyone with a limited credit history? Share it in the comments below.
Read More:
- What Is the Starting Credit Score?
- 15 Places to Get Your Credit Score for Free
- Credit Score Misconceptions: Do You Know These 7 Things That Most Consumers Don’t?
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Tamila McDonald is a U.S. Army veteran with 20 years of service, including five years as a military financial advisor. After retiring from the Army, she spent eight years as an AFCPE-certified personal financial advisor for wounded warriors and their families. Now she writes about personal finance and benefits programs for numerous financial websites.
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