At O1ne Mortgage, we prioritize your financial education and well-being. Understanding the various financial tools available to you can help you make informed decisions that benefit your financial health. One such tool is the co-branded credit card. In this article, we will explore how co-branded credit cards work, their benefits, and whether they are the right choice for you.

How Co-Branded Credit Cards Work

A co-branded credit card is a result of a partnership between a credit card issuer and a non-credit card brand. These cards are commonly associated with airlines, hotels, big box stores, automobile manufacturers, entertainment companies, and various travel brands. The primary advantage of these partnerships is that they allow brands to offer special perks to their loyal customers.

Co-branded credit cards function similarly to other credit cards but often come with brand-specific rewards and benefits. For instance, you might earn additional points per dollar spent on purchases made through the co-branded company. These cards also offer the same types of purchase protections, benefits, and insurance as other credit cards, such as zero liability for unauthorized purchases.

One key difference is that some co-branded cards are closed-loop store cards, meaning they can only be used at the brand’s stores. Open-loop cards, on the other hand, can be used anywhere that accepts the associated credit card network, such as American Express, Discover, Mastercard, or Visa.

Benefits of Co-Branded Credit Cards

The benefits of co-branded credit cards can vary depending on the card, but they generally include:

• Status in a loyalty program
• Bonus rewards for using the card
• Annual benefits like coupons or free hotel night vouchers
• Ongoing brand-specific benefits such as free shipping, extended returns, free checked bags, or statement credits for purchases from the brand

Additionally, many travel brands offer co-branded cards that do not have foreign transaction fees. Even brands without a loyalty program might offer co-branded cards with cash back rewards.

Should You Get a Co-Branded Credit Card?

Co-branded credit cards can be a valuable addition to your wallet, but it’s essential to have a specific reason for opening one. Here are three good reasons to consider:

1. You want a new everyday credit card that allows you to earn rewards in one of your favorite loyalty programs whenever you shop.
2. You want to save money by using the card for specific purchases, such as booking airline tickets with a card that offers free checked bags.
3. You don’t plan on using the card often but will take advantage of one of its benefits, such as free airport lounge access or an annual hotel night voucher.

Before applying, review how applying for a credit card can affect your credit scores and consider if having a new card might lead you to overspend. If the card has an annual fee, weigh the benefits you’ll receive against the cost.

When you’re ready to apply, check the current welcome bonus offers for new cardholders. Sometimes you can get a coupon for your next purchase or bonus rewards if you meet certain requirements. However, you might only be able to receive the welcome bonus offer on a card once or once every couple of years. Make sure you can meet the requirements and will get good value from the bonus offer.

Check Your Credit Score Before Applying

Your credit history and credit scores can affect your eligibility for a new credit card, including co-branded credit cards. Check your credit score for free to see where you stand and get tips on how to improve your credit score. You can also use tools from O1ne Mortgage to compare current credit card offers, including co-branded credit cards, based on your unique credit profile.

Contact O1ne Mortgage for Your Mortgage Service Needs

At O1ne Mortgage, we are committed to helping you navigate your financial journey. Whether you’re looking for a new credit card or need assistance with mortgage services, our team of experts is here to help. Call us today at 213-732-3074 for any mortgage service needs. Let us help you achieve your financial goals with confidence.