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Credit - Third Party Credit
When evaluating a credit card solicitation, you should determine who is making the offer. Is the offer coming from a financial institution which actually issues credit cards or from a company which claims it will obtain a credit card for you? Virtually, all third party credit card offers involve a fee to obtain a credit card application. Some firms refer to it as a "processing" fee, while others may use a "900" telephone number to call for an application, which can cost the consumer a considerable amount. The firm that is promoting a credit card offer and is requiring an up front fee, usually is promoting either a secured or an unsecured credit card. If the offer is for a secured card, once you receive the application, you may learn that you must maintain a deposit in an out-of-state bank's account before you can get the card. The amount of money deposited will equal the line of credit offered. The money deposited will serve as collateral for the credit card. A collateralized account may be a way for consumers to prove responsibility in paying credit card bills, but you may be able to obtain such a card without paying a fee to a third party. Consumers should comparison shop among various local financial institutions. Offers for an unsecured card typically do not require any deposits to a bank, but they may turn out to be a card which can only be used to make purchases from the promoting company's own merchandise catalogs, rather than a credit card which is recognized by local merchants. Prosepective purchasers of this type of card should consider the merchandise contained in the catalog and the prices charged for the merchandise in order to determine the value of this offer. BBB advises consumers that it is unlikely that any firm or individual can guarantee you a nationally known credit card which is recognized by local merchants without first conducting a credit check on the applicant. BBB has been advised by officials of nationally known credit card companies that these companies do not charge an advance application processing fee.