Find the credit card that's right for you

Rejection hurts, even when a credit card issuer rejects an application using an automated system. To improve your odds of being approved for a new account, try these steps. First, request your free credit score from Credit.com to find out where your credit worthiness stands. Next, learn which credit cards are designed for those with your credit profile, so that you only fill out applications that are likely to be approved.

When filling out the application, be sure to list all forms of household income, including investments, child support, alimony payments and the income of your spouse or domestic partner if it can be used to pay the credit card account. And if your application is initially rejected, be sure to call the card issuer and ask for reconsideration. In many cases, applicants may be able to reallocate their credit lines or offer other information that results in approval.

There is no best time of year to apply for a credit card, so the right time will vary for each individual cardholder. A good rule of thumb for building or maintaining good credit is to apply for credit only when needed, keep credit card balances low or paid off whenever possible, and make on-time payments with all creditors.

However, applicants with excellent credit (a 750+ FICO score) might also choose to apply for a new card if they feel that they can benefit from a card's rewards, benefits or other terms. Those with credit scores below that should be sure to only apply for cards that they are likely to be approved for, or just wait until their credit has improved enough to ensure they meet the credit issuer's criteria.

Furthermore, anyone who is considering applying for a home mortgage should wait until they have closed on their loan before applying for a new credit card. While new credit card applications do not have a major impact on credit scores, mortgage lenders do not like to see applicants requesting new lines of credit before they close on their loan.

APR stands for Annual Percentage Rate, and is an interest rate expressed in terms of a year. This is a standard unit for measuring an interest rate, just like "miles per hour" is a standardized way of measuring speed. When a card's APR is divided by 12 (to get a monthly rate), and that rate is multiplied by an account's average daily balance, it results in the interest charges that must be paid when cardholders carry a balance on their credit card.

Cards can have separate APRs for purchases, balance transfers and cash advances. Some cards even offer an introductory APR that is valid for a limited period of time when a new account is opened. In addition, most cards impose a higher penalty APR when cardholders fail to make a payment for 60 days.

Credit cards seem like simple financial instruments, but they arrive with pages of fine print that use terms more suited to a law office than a kitchen table. Here are some key terms you need to know.

A Balance Transfer is when cardholders pay off one card by making a charge to another. Promotional balance transfers offer lower interest rates for a limited period of time, allowing cardholders to save money by paying off their balance on cards that have a higher interest rate.

A Grace Period is the time period after a statement period closes when cardholders can pay their statement balance in full without the risk of accruing interest.

A Foreign Transaction Fee is imposed on all charges processed outside of the U.S., regardless of where you are, or what currency you use. Some credit cards offer the benefit of no foreign transaction fees.

For more information, see Credit Card Terms Everyone Should Know.

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