New Credit Card Offers Flood Mailboxes this Spring

As credit from banks and other lenders begins to loosen up a little bit compared to the credit drought of recent years, credit card companies are busy rolling out new packages and offers to lure customers. Millions of pieces of mail have been sent to those consumers who have decent credit, for example, because whereas card companies used to target people with terrible credit they are now catering to those who pay their bills and do not carry outrageous amounts of debt that they cannot manage.

There have been major shifts in policy and philosophy at the big card companies, and while some have been voluntary most are primarily in reaction to increased scrutiny and new legislation passed to help protect consumers from predator credit card lending practices. That's why you'll see many offers in the mail promoting new cards with features that help you manage your household finances, balance your budget, keep track of your expense categories, pay down balances faster, and just do a better overall job of tracking and consolidating your credit card purchases and payments. What happened was that Congress made some of these features mandatory, and as soon as credit card companies realized they had to comply with the new consumer credit regulations, they figured out some creative ways to turn that potential impediment into a positive marketing feature. In other words they adopted a philosophy of “if you can't beat em, join em and then came up with new cards that encourage consumers to use their credit wisely and make payments in smarter ways.

One example is that Congress mandated that credit card companies could not apply your payments the way they used to – by using it to pay down your least expensive balances first. Now your card company has to apply your payment according to your preferences, by applying it for example to the highest interest rate balance or the balance you're been carrying and trying to pay off for the longest time. So faced with that new regulation, card companies launched a bunch of new features that basically do what is required of them – but in a more user-friendly way that makes the cardholder feel that they are more in control of their payments and budgets. That's a good thing, though, because no matter why the card companies did it they have now given cardholders better tools with which to understand their debt, prioritize it, and pay it off in a timely fashion.

This kind of card – coupled with cash back or rebate features and a really low or zero percent introductory rate – can be a good deal for you if you're in the market for a new card. Lots of consumers are trying to pare down their plastic and find one card that serves all of their credit card needs, and this may be a great time to do just that because many of the new deals being offered to consumers with good credit are quite reasonable and attractive. You can get a card with perks like a zero percent APR on purchases and balance transfers (after paying a transfer fee) and the intro rate last for 12 months. Meanwhile you can use the card to qualify for cash back benefits while taking advantage of the kind of payment and budget management tools mentioned earlier. If you later decide that the card is not for you, just drop it before your zero percent teaser rate expires. But chances are that if you are searching for a single-resource type of card to become your constant wallet card, you might find what you're looking for by studying the offers being mailed out this spring.

The card companies are really targeting those with the best credit, however, so if your mailbox seems a bit empty it may be because your credit history has a few blemishes. Consumers who will get lots of great looking offers are those who have outstanding credit and may have canceled some cards in recent months in order to streamline their finances. Card companies are eager to win those customers back, hoping that as the economy picks up steam that those new customers will become a steady source of card company revenue. If the economy gains momentum, the Federal Reserve will probably start to ratchet up interest rates, too, and as that happens credit card companies will raise their rates and cut back on the zero percent offers.

One of the best things about these new promotional offers in the mail is that they are readable. You may still need a magnifying glass to study the smaller print, but in general the newer formats – demanded by Congress – offer a good snapshot of features, benefits, rates, terms, and penalties. They also typically have a bold statement on them telling you how to opt out of future credit card offers, just in case you are sick of getting junk mail. But the more things change, the more some things stay the same – so you should still pay closer attention to the complicated smaller print on the back of the letter than you do to the rosy and optimistic marketing hype on the front of the letter. If it's in beautiful pastel colors like baby blue and calming green and the font just jumps out at you, it is probably slick marketing without a lot of substance. But if the print is smaller, harder to read, and in basic black and white then that's probably where the real meat and potatoes of the offer is spelled out for you to really understand the pros and cons of the offer.