Applying and getting approved for a credit card can be challenging, especially if you have no credit history or have had trouble applying for a card in the past. Many factors affect your chances of getting approved, so knowing how to apply for a credit card is crucial for securing the card you want.
But just because you’ve had problems with credit card applications in the past doesn’t mean it can’t be different this time around.
We’ll walk you through the steps you can take to increase your chances of getting approved for the credit card you’ve been hoping for.
1. Understand how your credit score affects your application
Before submitting any applications, you must understand how your credit score affects your approval chances.
Each issuer has its own criteria and may accept different credit scores for different credit card limits. Typically, the higher your score, the better your chances of being approved and getting a high credit limit.
There’s no standard minimum credit score all credit card issuers abide by. But generally, a credit score of at least 660 is needed for approval of an unsecured credit card.
| FICO® Credit score ranges |
| 300–579 |
Poor |
| 578–669 |
Fair |
| 670–739 |
Good |
| 740–799 |
Very Good |
| 800-850 |
Exceptional |
2. Learn how to access your credit history
Now that you understand the role of your credit score, the next step is to read your credit report. Having negative items on your report (things that hurt your credit, such as late payments, delinquent accounts, collection accounts, etc.) can be a significant factor in why you have a low credit score.
Luckily, getting a credit report is easy. You’re also entitled to a yearly free credit report from Equifax, TransUnion and Experian through AnnualCreditReport.com. Once you access your report, review it to ensure all the information is accurate and fair. For example, an inaccurately reported late payment could be keeping your credit down. If you find any discrepancies, you should challenge these errors with each credit bureau to make your credit report an accurate representation of you.
3. Improve your credit score
If your credit is lower than you’d like, now’s the best time to start implementing changes to boost it. Some key steps you may want to follow include:
- Staying current with your payments
- Lowering balances on any existing accounts
- Not taking on new debt
Since these three things directly impact your credit, they can also help improve it. For example, payment history is the most significant factor in your FICO credit score, accounting for 35 percent. So, you’ll want to prioritize making payments on time every time.
The amount you owe is the second-largest credit score factor, accounting for 30 percent. But what matters here is your credit utilization ratio—the ratio of how much credit you’ve used to how much credit you have available overall. Keeping a low balance on your credit accounts (i.e., a low amount owed) will keep your credit utilization low.
It’s recommended to keep your credit utilization below 30 percent. Typically, the lower your utilization, the better your credit.
4. Determine the best card for you
There are many different card offers available on the market. When evaluating your options, determine what factors are most important to you. Then, you can research and compare different cards based on your specific criteria.
Researching credit cards is essential. You’ll want to avoid applying for the first card you discover. Instead, consider factors such as:
- Card benefits: Choose a card with benefits that are important to you. Try to find a card offering a signup bonus for some additional benefits.
- Fees: If the card comes with fees, make sure you can pay them and that they’re worth the benefits.
- Familiarity: Consider applying for a card offered by your bank or credit union. Having an existing account and history may increase your likelihood of getting approved for a card.
- Annual percentage rate (APR): The APR on your credit card is your interest rate. If you can’t pay the card in full each month, you’ll be charged interest on the balance. Some cards come with a higher APR, so choosing a card with a lower rate is best.
- Card requirements: Consider your credit score and what credit cards you’re most likely to qualify for. This information is usually available online on the card issuer’s site.
You should also consider cards that allow you to check if you’re prequalified. This typically requires some paperwork and a soft inquiry to check your score. These checks can work in your favor since they indicate whether you meet all their requirements, giving you an early indicator of your approval chances. However, you still need to apply for the card to get fully approved.
5. Submit your application
Once you’ve done your research and picked a card, it’s time to apply. Most banks allow you to apply online, or you can apply in person if the bank has a location nearby. Applying in person can be helpful because a banker will likely be able to answer any additional questions you may have.
When applying for a credit card, you’ll typically need to provide the following personal information:
- Physical address
- Proof of income
- Social Security number
- Credit score
Credit application tip: Add all streams of income
To get any type of credit account, you need to prove you’re making money. This is so credit card companies know you have the ability to make your payments each month. It also helps determine your credit limit.
It’s important to include all forms of income to demonstrate your ability to pay and keep up with payments. A higher income puts your debt-to-income ratio in your favor.
Applying for a credit card with no credit history
If you’re applying for your first card or have no credit history, consider one of the following options:
- Secured credit card: A secured card is usually easier to get approved for because you put down a deposit with the bank that works as your credit limit. You charge the card and make payments each month.
- Student card: There are student credit cards geared toward college students to help them build their credit. These cards will accept students with little to no credit history, as long as you can prove enrollment and income.
- Authorized credit card user: You can be added to another person’s card as an authorized user. This gives you access to their card and allows you to build credit.
If you get approved for a credit card
Use your new credit card wisely. Everything you charge has to be paid back. If you carry balances over from month to month, you’ll also have to pay interest.
If you can, try to pay the entire balance off by the end of the month so you don’t have to pay interest—and remember to pay on time. You don’t want to pay late fees, and you don’t want late payments to show up on your credit report, as these can be damaging.
If you get rejected for a credit card
If you get declined for the card, don’t be discouraged. You can apply for another one, although too many applications in a short period can hurt your credit.
If you get declined for a credit card, the card issuer must tell you why. Once you know the reason, you’ll know what to work on to improve your approval odds in the future.
Credit cards and your credit
If you use it responsibly, a credit card can be a great tool to boost your credit. When looking for a credit card, keep your finances in mind and do some research to find the right credit card for your needs.
Even if you have poor credit right now, there’s still time to take steps to improve it. Once your credit is healthy, you may be able to secure any credit card you want. If you’re worried your credit is too low to get approved for a credit card, consider working with the team at Lexington Law Firm. We offer a free credit assessment to help you understand your credit report. Lexington Law Firm has helped hundreds of thousands of clients remove millions of unfair, inaccurate and unverified information from their credit history. Get started today.
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