How Does Your Credit Score Affect Your Credit Card Application?

Did you know that your credit score can have a great influence on your credit card application?

If you want to apply for a credit card, the bank will use your credit score to estimate their risk in terms of whether you will pay your charges or not.

In that regard, the higher your credit score, the higher your chances are of getting approved for your desired card when you fill out that next credit card application.

Credit Card Application

Insights

Most credit card issuers will use your credit score to weigh their options and to determine how much credit limit to offer you after your credit card has been approved.

This teaches us to always know the status of our credit scores. There are free credit score estimators and calculators online that you can make use of.

You should, at all times, keep track of your credit score to get reports in case of any issues with your credit report and also show how your score keeps going up as a result of timely payments.

You also have an option where you can compare with national averages and find out how you are doing in terms of maintaining a healthy credit score.

Minimum Requirements and Scores

In some cases, you might be denied a credit card even with a good credit score. This might happen if your credit score is not in 700s and above.

Banks usually follow criteria to approve your credit cards, but in most cases, these are the reasons you might be denied a credit card even with a good credit score.

  • Having too much debt or remaining with high credit balances after clearing the balances.
  • Having a short credit history.
  • Having too much available credit.
  • Having recent charge-offs, late payments, or other negative items.

In some cases, if your credit score is in the high 600s, and depending on the institution with which you are applying for a card, they might accept your application, but you need to be extremely alert.

You will be approved if you have more than one year at least of timely payments plus little credit card debt. Also, if your score is below 700 because of either revolving debt or missed payments, the chances are high that you will not get approved.

Do you have any recent significant balances or late payments on your current credit card? If so, do not apply for a new credit card. It doesn’t matter if you have paid your balances in full; that big balance from the month you traveled might look like a debt to computers in the bank.

When to Apply for a New Card

However, all is not lost. If you want to apply for a new card, only do so under the following circumstances.

  • You do not have any missed credit card payments for at least the past two years.
  • You do not have any credit card balances that are too high.
  • You have not applied for any credit in the recent past.

Conclusion

As you apply for a credit card, the first thing to remember is to maintain a healthy credit score. Always pay your credit cards on time and in full. Doing so will help you quickly get your credit card application approved in case you want to apply for another credit card.