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How to Select A Cash Rebate Credit Card

By Edited Sep 15, 2016 1 1

Cash Rebate Credit Card Overview

Select the right Cash Rebate Credit Card
A cash rebate credit card has many advantages over regular cards, and obviously the cash back incentive is the main attraction. Some cash rebate credit cards reward a certain percentage of cash back for a purchase, while others reward points. The rate for a cash rebate credit card ranges from 2% to 5% cash back. In addition to rebate incentives, a cash rebate credit card sometimes pays a one-time cash reward just for signing up for the card.

While rebate credit cards might sound great, the overall expenses of the card can easily outweigh the benefits if you choose a lousy card. If you don't qualify for zero percent interest, or at least a low interest rate, you could wind up paying too much if you tend to carry a big balance. Some rebate credit cards only provide rebates for certain purchases such as gas or groceries. While the gas savings can be a nice incentive, some rebate credit cards only allow rebates at certain gas stations. If you're able to qualify for a good card, a cash rebate credit card is a far better option than a regular credit card. If you're going to be making purchases, you might as well get something in return, even if it's only a couple of bucks.

Qualifying For A Cash Rebate Credit Card

Due to high default rates and new credit reform laws, many lenders have tightened their eligibility guidelines for credit cards. To get a decent cash rebate credit card with good benefits, you'll generally want to have an above-average credit score of at least 600, and to get the best cash rebate credit card available, you should have 750 or higher. People with excellent credit will get the best cash rebate credit card. The cards available for excellent credit status provide some great rewards and most of them have zero interest for one year to start. Some of those cards provide additional cash back perks for using specific online merchants. Before you select a cash rebate credit card, you should understand how to properly compare them.

Choosing the Best Cash Rebate Credit Card

Step 1
Select a cash rebate credit card that provides as many rewards as possible, but choose one with a higher return for the stores you frequently go too, such as the grocery store. You'll benefit the most from a card with a high return from grocery shopping since you'll be using it more often. If you need a cash rebate credit card for gas, you should spend some time to find a card with the highest possible return, but find out if there are any restrictions for using the card at different stations.
Step 2
Compare the annual percentage rates for each cash rebate credit card. If you have excellent credit, you may very well qualify for an intoductory rate of zero percent, which usually lasts for at least one year. Read the terms and conditions to find out the future APR after the intro period ends. If you plan on carrying a balance for more than a year, you'll need to choose a card with a reasonable future rate. If you have excellent credit status, you should have no problem getting a cash rebate credit card with a future APR of at least 10% to 14%.
Step 3
Find out about the fees. Practically every cash rebate credit card comes with fees, and some of them can really eat into rebate incentives which makes the benefits useless. Try to qualify for a cash reward credit card that doesn't have an annual fee. Some of them don't. Sometimes these fees are disguised as "membership fees" which are basically the same thing. Find a cash rebate credit card that has a low cash advance fee. Additional fees to look out for are the late payment fees. If you have a habit of making late payments, you could end up with a nasty fee on your next bill.
Step 4
Calculate the actual cash rebate credit card reward percentages earned. Some cash rebate cards reward cash back at a percentage of your purchases. The percentage rate for cash back is usually around 2% for many cards, but some cards offer more than that. Other rebate credit cards, such as travel cards, reward you with points that you must redeem. You earn a certain amount of points for every dollar spent. Carefully review the terms provided for cash rebate credit card offers before you apply. You should also call the company and ask a lot of questions if you don't understand the terms.
Step 5
Find a cash rebate credit card that does not have rewards limits, or at least limits that match your spending habits. Some rebate cards only allow rewards for a set limit of purchases each month. If you exceed that limit, you would not receive any cash back on those purchases. Calculate your spending habits to select the appropriate cash reward credit card. If you intend to use the card for groceries, you should determine your monthly spending habits at the grocery store so you can select the best card.
Step 6
Choose a cash rebate credit card with a fixed APR, not a variable rate. The variable rate means that the rate is more likely to increase at any given time. You could start off with 13% and end up with nearly 30% interest by the end of the year. If you're carrying a large balance, you'll be paying way too much interest. The fact is that companies can raise any type of rate whenever they want too, but the fixed rate on a cash rebate credit card is less risky.
Step 7
Avoid high balance transfer fees for rebate credit cards and try to find one with zero percent interest for at least one year. If you have a large balance, you could end up spending a couple hundred bucks just to have the balance transferred to a future cash rebate credit card. Many of these cards have a balance transfer fee. Choose one with a low fee or hopefully no fee at all. This might not be important if you plan on paying off your cash rebate card instead of transferring the balance, but it's always nice to have a card with low transfer expenses.


Sep 13, 2010 12:44pm
Good tips on how to choose a cash rebate credit card. Thanks for sharing.
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