Credit card companies rely on rewards and perks to draw customers, and the Chase Freedom Unlimited card is no exception. With an attractive promotional 0% APR and 1.5 percent unlimited cash back, the card is attractive to a variety of consumers, including college students seeking to both build their credit and obtain a financial fallback in case of emergencies.
While the Chase Freedom Unlimited card lands on its share of “top rewards” lists, is it the right choice for college students?
Applying for the Chase Freedom Unlimited Card
Chase uses a variety of factors when reviewing applications. And for some college students, particularly those with a thin or non-existent credit history, this can be a real positive, as many have yet to make their mark on credit reporting agencies.
That said, the Credit Card Accountability Responsibility and Disclosure (CARD) Act has changed the relationship between college students and credit cards, specifically when it comes to eligibility.
The CARD Act makes it harder for consumers under 21 to secure a credit card – in an effort to reduce the risks associated with young consumer debt. However, those under 21 are not entirely out of luck. To be considered and approved for a credit card, applicants under 21 must either have a cosigner or show that they have the ability to repay the debt by offering proof of income.
So, assuming you’re 18 or older with a proven and reliable source of income, can you get approved? The Chase Freedom Unlimited card is designed for borrowers with good credit. Though because of the other factors included in Chase’s decision (i.e., a limited the number of hard inquiries, minimum debt, and credit utilization), many applicants may find that they are approved with credit scores as low as 645, according to user reviews.
If you don’t meet credit requirements on your own, can you enlist a cosigner? Unfortunately, that’s not an option for the Chase Freedom Unlimited card, as Chase does not allow cosigners. However, if the goal is to simply have a credit card on hand, a student may be added as an authorized user on a parent’s credit card.
Chase Freedom Unlimited cards may not be as attractive as their other products, like the Chase Sapphire Reserve, but it does have competitive rates and terms. Currently, approved cardholders will be entitled to a 0% intro APR for 15 months; this includes purchases and balance transfers made during that promotional period.
At the close of the promotional period, the account holder will be responsible for paying interest on any remaining balance, and the interest, which is determined during the application process, will be anywhere from 17.24% to 25.99% variable.
In addition to the 0% promotional APR, this card offers 3% cash back on all purchases in your first year up to $20,000 spent. After that earn unlimited 1.5% cash back on all purchases. This differs from some other cards, including Chase Freedom, which limits or controls rewards based on categories. Cardholders may also be eligible for signup bonuses, such as extra cash back or cash bonuses, although promotions are limited and vary.
In addition to point rewards, the Chase Freedom Unlimited also offers users a host of other benefits, including no annual fee; purchase, return, price, and fraud protection; travel accident, car rental, and baggage insurance; as well as travel and roadside assistance.
Finally, and perhaps equally attractive for those who are looking for a credit card to use over the years, the Chase Freedom Unlimited has no annual fee and cash back rewards don’t expire.
When viewed as a general use credit card, then Chase Freedom Unlimited offers many perks and is competitive within its market. However, the same may not be true when the market is shifted to focus specifically on college students.
If you don’t have a steady stream of income and are under 21 and therefore ineligible under the CARD Act, you won’t be able to reach approval by adding on a cosigner. This would make other credit cards – that cater toward students or borrowers with poor credit – attractive. For example, Bank of America and Wells Fargo do allow applicants to add a cosigner.
Other student-focused credit cards, like the Discover It, offer student-specific perks, like GPA Rewards, late-fee passes, or account freezing, many of which could be more desirable for students and parents who are just testing the waters of credit responsibility.
If you have a positive credit history, even if it’s thin, and you have a reliable source of income, then the Chase Freedom Unlimited may be a good choice for you. The cash-back rewards add up over time, and the card can help you build a positive credit portfolio. However, if you don’t meet the requirements, or you are looking for a card that is designed specifically for students, you might want to continue your search.
Author: Jeff Gitlen
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