Your chances of being approved
|Credit card approval rate by score range|
|Credit score range||Approval rate|
There are some conclusions to be drawn from these numbers. As Pearson mentioned, it is possible to have a great credit rating and be denied a credit card. It’s also possible to qualify for a credit card even if you don’t have any credit, which is encouraging if you’re just starting to build your credit history.
Improve your chances of being approved for a card
Whether your credit is excellent or fair, there are steps you can take to increase your chances of being approved for a new credit card offer.
Check your credit report and score
If you haven’t verified your credit report and scores again, this is a good place to start in trying to improve your chances of getting a credit card. Your credit report is a collection of information used to calculate your credit scores. This includes things like payment history, account balances, new credit applications, defaults, and public records.
You can get your credit report for free once a year of the three main credit bureaus, Experian, Equifax and TransUnion, through the AnnualCreditReport.com website. If you’ve never checked your credit report before, it may be helpful to get all three reports at the same time to see how your credit history compares. You may have a creditor who reports to only one office instead of all three, for example, which could affect your credit score.
When you review your reports, verify that all of the information is correct. If you find an error or inaccuracy, you have the right to dispute it with the credit bureau reporting the information. If the office checks that an error exists, it is legally obligated to remove or correct it, which could potentially add a few points to your score.
Adopt healthy credit score habits
Two factors in particular carry the most weight for FICO score calculations: payment history and credit usage. Credit usage is how much of your credit limit you are using at any given time. Knowing how to manage these two factors is essential to improving your credit score. “Your payment history is the first thing that goes into calculating your credit score,” says Pearson. “One late or missed payment can lower your credit rating by more than 50 points. ”
You can avoid this scenario by making your payments on time every month. If you’re struggling to manage due dates, automating payments from your bank account can simplify the process of paying bills. Alternatively, you can set up alerts through your bank or with your billers to let you know when a due date is approaching.
If you already have one or more credit cards, keeping balances low can improve your score as well. “Most lenders like to see your credit utilization rate at 30% or less,” says Pearson.
Paying off your current balances can improve your utilization rate. Another option that you can try is to request a credit limit increase on your cards. By increasing your available credit limit, you could improve your usage rate, assuming you don’t make any new purchases above the upper limit.
Compare card offers carefully before applying
Credit card companies change regularly credit card offers. While they may not explicitly state the minimum credit score they seek from consumers, many do give a general range that indicates who the card is for. For example, a credit card company might offer a cash back card with a single reward rate for consumers with good or fair credit and reserve a card with a higher cash reward rate or better benefits. for consumers with excellent credit.
Take the time to do your homework and search card options can help you narrow the field to the cards that are best for you, based on your credit profile. From there, you can further streamline the list by determining which cards best suit your needs. For example, if you have a balance, you might prefer a card that offers a low annual percentage rate (APR) on purchases. Or you might be interested in a card that offers miles or travel points rather than cash back.
Remember to look beyond credit scores and consider other requirements a lender may set, such as a minimum income threshold. Also check the card options your bank offers against what other banks advertise. If you have a positive banking history with your bank or credit union, you may find it easier to qualify for a card. Take the time to review the APR and fees for any card you choose, so you know what the card will cost you.
Try other credit creation options if you are denied
if you can’t get a credit card approved, don’t give up hope. You may need to work a little harder to increase your credit score. In the meantime, consider other options for using credit, such as a secure credit card or a loan of credit-builder. These are small personal loans that you can use to establish and / or develop credit by making timely payments.
If you are unable to obtain approval for a card because you are under 21, the age limit for obtaining credit cards imposed by the CARD law 2009, you can try the Authorized user road. This involves asking your parents to add you to one of their cards as an authorized user. You would not be responsible for the debts incurred on the card, but you could enjoy the benefits of their responsible use of the card. This could be a stepping stone to getting your own card approved down the line.
The bottom line
Approving a credit card can take a long time if you don’t have a long credit history or if your credit score is recovering from a past mistake. Remember to be patient when building credit, as it may take some time before your efforts are reflected in your credit score. In the meantime, continue to practice good credit habits, like paying your bills on time, and consider signing up for a free program. credit monitoring service to track your progress from month to month. You can also choose from one of the best credit monitoring services available.