Before applying for a credit card, one thing you need to ask yourself is what do they check when applying for a credit card? There are two reasons why this question is so important during the process of applying for a credit card. Firstly, this allows you to understand the required information or factors that get you approved for the credit card. This helps you to find the most qualified credit card that meets your qualification for the card. Secondly, limiting your credit card produce a great result in helping to remove negative history on your credit score.
But what do they check or need when applying for a credit card? However, there are certain factors that determine your approval for the card or increase the chance of you getting approved for the credit card especially if you are new to using a credit or you’re trying to rebuild your credit score. The following below helps to explain what they check when people want to apply for a credit card.
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What do they check when applying for a credit card?
Credit Scores
Yes, your credit score is one of the factors used in determining the qualification for a credit card in general. Credit card companies make use of your credit score data from companies such as FICO and Vantage to estimate your creditworthiness.
Aside from the fact that your credit score is not the only factor when applying for a credit card, but is considered most important for the application. However, people who have good credit to excellent credit scores have a higher chance of being approved than people with fair or bad credit scores.
- Number of Delinquencies
The number of the delinquent account on your credit reports is another factor credit card companies watch out for when applying for a credit card. A delinquent account is an account that has past due. Initially, most creditors won’t submit that an account is delinquent until he/she has passed the due date given to him/her to the credit bureaus. And one that is done reduces your chances of getting approval for the card.
Hard Inquiries
The word “Hard Inquiries” simply means that credit card issuers have to thoroughly check your credit before deciding whether or not you qualify for the application of the card. The particular iniquity can last on your credit report for a very long time.
If you have so many hard inquiries this can cause disapproval for the card thereby presenting a red flag to the credit card issuer. Therefore, you need to ensure that you don’t have high hard inquiries.
Credit Card Utilization Rate
Your payment history or credit score is not the only important factor to consider for the application for a credit card. Even if you were on time in making the required payment before due, could still pose a risk. How? Your credit card utilization is one thing you need to consider for these kinds of problems.
Your credit utilization is estimated by the overall available credit used by you. Most importantly, you need to ensure that you make use of less than 30% of your total credit limit.
Income
During the process of the credit card application, you might be required to provide information about your income. The credit card issuer might likely compare your overall income to all your debt. This is commonly referred to as the debt-to-income ratio.
Credit History
If there is a limit on your credit history, this can affect the approval for a credit card. Generally, credit card issuers want a trustworthy person that is willing to repay their debts. If you have a short credit history, this indicates that you’re not creditworthy. If you don’t have a good credit history to indicate your creditworthiness, this can stop you from applying for a credit card.
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However, for those with low credit history, it is advisable to start with a secured credit card that includes Capital One Platinum Secured Credit Card. With a secured card, you can easily build credit only if you make use of the card responsibly.
In conclusion, those with great credit scores get instant approval when applying for a credit card. But not only does your credit score determine approval for the card. But other following factors listed above are also worth looking at as well.
FAQ
How to know if you get approved for a credit card?
Regardless of where you’re applying for a credit card, either online, over the phone, or in person. Once you ensure that the information you provided is current. Then you can find out if you are approved for the card in 60 seconds or less.
However, before submitting the application, you need to ensure that you provide the correct information and you don’t press the back button, this can utter the application.
How to get a credit card for the first time
Getting a credit card for the first time is simple, all you need to do is ensure that you have the following factors needed when applying for a credit card. Plus, you can apply for the credit card either online, via phone, or in person from the credit card issuer.
What is the minimum credit score to get a credit card?
The required minimum credit score to get a credit card is 750 according to the CIBIL minimum score. Any applicants with a credit score below this might not get the chance for approval for credit from top companies. Besides, there are certain banks that offer credit cards for applicants with no credit history or who have below the 750 minimum required credit score.
