This is a tough question. What exactly constitutes "low tier" or "high tier"? Excluding really obvious tiered cards like the Palladium and Centurion on the high-end and anything from First Premiere on the garbage-end, it's not as cut-and-dry as you might think.
Chase's Freedom, for example, is the first Chase card that many people get, but it's not trivially easy to acquire. Just search the forum for all the threads by people who have tried and failed to do so. So given allo that, is the Freedom an "entry-level" card or not? I honestly couldn't tell you.
Less than 2% cash back is low tier. greater than 2% is high tier.
2% is the average amount you should expect to obtain...
Well, at least that definition works for me.
@longtimelurker wrote:
@Stralem wrote:This is a tough question. What exactly constitutes "low tier" or "high tier"? Excluding really obvious tiered cards like the Palladium and Centurion on the high-end and anything from First Premiere on the garbage-end, it's not as cut-and-dry as you might think.
Chase's Freedom, for example, is the first Chase card that many people get, but it's not trivially easy to acquire. Just search the forum for all the threads by people who have tried and failed to do so. So given allo that, is the Freedom an "entry-level" card or not? I honestly couldn't tell you.
I think the Freedom is one of Chase's entry level cards (along with say the Slate) simply because it is easier to get than some of the other cards, such as CSP (which are easier to get than the Palladium!) But "entry level" doesn't mean anything negative, or imply that is itrivial to get, merely that, for that particular issuer, you would be more likely to be approved for that than one of the higher tiered cards.
But I agree it is not cut and dried in most cases. Sometimes, like with say US Bank, they tell you that if they are unable to approve you for the Cash Plus, you will be considered for (don't recall the name). So that tells us the order between those two cards. In other situations it is if we cannot give you the Sig/World we will consider you for the Platinum.
IF you go by UW guidelines (which is about all you can do really) I fully agree with longtimelurker.
That said, I think it's pointless: some cards are better suited for an individual others - much as I'm surprised by it, the Freedom this year is better than a CSP for me, but it's not debatable that Freedom is Chase's entry level card currently, and CSP is effectively their top tier (Palladium doesn't count in my estimation: deposit $100k and pay a fee for mediocre benefits /yawn, I could get that card and I'm not so certain I could get a CSP right now though if I took the 100k deposit I probably could).
You can find pretty similar things for virtually every lender out there, but these things change on a regular basis. As an example neither the CSP nor Amex's BCP are nearly as presetigous from an underwriting perspective as they were up to the first half of 2012. Until consumers start defaulting again, we're still seeing a race to the bottom as the newly banked consumers is likely a blue water market.
While there are certainly 'bottom-tier' cards (CreditOne, First Premier, anything with a rediculous AF/MF and deposit, etc.) as well as 'super-high-tier' cards (Centurion, Paladium, that Dubai one with a diamond in it, etc.), there really isn't a whole lot of difference between what's in the middle.
Sure, CapitalOne is more of an entry level issuer, since they will be more likely to give out credit to people that have none. And some banks are more stingy with who they will approve for anything. But in the end, the benefits that the cards come with, and how valuable they are to you, is what really matters. For example, the CapitalOne QuickSilver card (either version) comes with 2% cash back across the board for any purchases. That's a pretty nice perk that can double your earnings in categories that aren't usually included in promotions (gas, food, travel, etc.). But it's also considered a lower status card.
On the other hand, Amex Platinum still has a lot of prestige. But the benefits are mediocre for most and getting worse every year. Unless you travel a LOT, there is no reason to get it. Amex keeps pestering me to upgrade my PRG to the Platinum, but I have no interest in it.
In the end, for the middle spectrum that covers 90% of the cards out there, prestige is meaningless. The average person has no idea what cards actually have more stringent UW guidelines and would technically imply that the cardholder had better credit. Especially in the US where the highest category cards (Visa Signature, Mastercard World) have paltry requirements to some of their overseas counterparts.
So you shouldn't concern yourself as much with what is better simply because a bank says it is, and focus more on what's better for you.
Freedom is a good card but probably not entry level. People still need fairly good credit and a little thickness to their file for a decent limit. Approval with a low limit can be pretty frustrating.
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