Like any other person across the world, you most likely do not like rejection. This is especially true when you apply for a credit card. Building up your credit score means becoming an attractive potential customer to a plethora of credit card companies.
If you want to be a desirable customer to major credit card companies, then you need to learn how to improve your credit card approval odds. Here are some tips to increase your chances of getting your credit card application approved. Be sure to keep them all in mind!
#1. Don’t Apply For Lots Of Cards At Once
Whenever you apply for a credit card, it automatically affects your credit score. In other words, applying for many cards at once will not look good to lenders or credit card companies. Your best course of action is to take things slow and find the right card to apply for. Never put all of your eggs in a number of baskets. As for requests, it is recommended to spread them out at least six or more months apart.
#2. Reduce Your Debt
This is the part where most people fail to realize. If you really want to improve your credit card approval odds, you need to reduce your debt first. The ideal move is to keep your credit utilization ratio below 30 percent. In case you did not know, the ratio refers to the total balance divided by the total credit limit. For instance, you have around $1,000 in available credit. You must ensure not to use up over $300 of this limit at any given time.
#3. Include All Of Your Income In Your Application
By now you should already know that higher income means getting a better chance for a new credit card. This is where you want to include all of your income when you apply for a credit card. Do you have a side income? If so, then include it. Do you also earn money from babysitting, freelancing, or any other side tasks you have? If your answer is also “yes,” then do not hesitate to include them in your application.
Basically, your goal is to impress lenders and show to them that you are financially capable. Of course, this is not a way to exaggerate your income – doing so will only affect your credit card approval odds for worse. Think of this one here like this: Any income you earn and you plan to report on your tax return must be detailed on your credit card application.
#4. Apply For Cards That Fit Your Credit Score
This is really a no-brainer here, but you will be surprised by the number of individuals having no understanding of what this means. Let’s say you have a fair credit. Your move here is apply for a credit card that fits this score. To put it simply, applying for a credit card meant for individuals with excellent credit, when you have fair or poor credit, will definitely result in an automatic rejection.
So, as much as possible, you should only apply for credit cards that perfectly match your current score. Do not go around it. Instead, build your credit score from there. It is better to be in this situation than receiving a rejection in the end.
#5. Always Apply Through Your Main Bank
There is a reason why many experts suggest applying for a credit card through the main bank. This is simply because your chances of improving your credit card approval odds are high – and you are even likely to get an approval later on. If your bank comes with an offer that has credit cards with perks that fit your needs, then you should consider applying for it.
Remember that applying through your main bank will dramatically speed up the overall application process. Why? Well, that is because it already has concrete knowledge of your financial information. For instance, you have a direct deposit. The bank already knows about your salary information. Due to this, your income is verified and, thus, your chances of getting an approval are high.
#6. Go For A Secured Card To Build Credit History
Without a credit score that will qualify you for a traditional credit card, it is a good idea to find a secured credit card just so you can build a reliable credit history. But if you apply for a secured credit card, you will be asked to put in some cash deposit in order for your credit line to be equal to a particular amount. As long as you make on-time payments (e.g. for six months or a year max), your chances of getting an approval for a traditional credit card are likely to raise dramatically. The same thing can be said even if you go for an unsecured, conventional credit card. Again, it is important that you are faithful in making payments. Otherwise, the lender or credit card company will not notice your positive efforts; hence, the approval is likely to be a rejection.