Before filling in a credit card application, it’s worth doing your homework to see if you’re likely to be accepted.
If you’ve been turned down in the past, say, or simply want to ensure acceptance, there are steps you can take to make you more attractive to lenders by improving your credit rating. Lenders look at a certain set of criteria when it comes to applications for a credit card, and each will have different requirements that will produce a ‘score’ to see if you are a suitable candidate. But to make yourself more attractive, you can work on cleaning up your credit history – particularly if you’ve never borrowed before.
Get a copy of your credit report
It is worth regularly checking your credit report – at least once a year – to make sure the detail is correct and you know where your score stands. If you spot errors these could pose significant problems when applying for a credit card, say, or other loan, so it’s vital that the details are correct.
Add your name to the electoral roll
When your local authority sends you a form once a year to put your name on the electoral roll, make sure you add it. This enables you to vote, but also makes it far easier to get credit.
Before applying for a credit card
Making numerous applications for cards in the hope of being approved for one is unwise. Each application is likely to leave a ‘footprint’ on your credit file as the lender does a search on your history, and if your application is then turned down you’ll find it harder to be accepted elsewhere.
Get stability in your life
Lenders like to see that you’re a trustworthy candidate for credit, so a history of several years at the same address, say, may help, along with holding the same job for a decent period of, say, three years. If you’re heading for a life change, then it might be worth applying for a credit card before making the shift.
Reduce your current debt
While lenders want to see some history of making regular repayments on some form of credit, they’re unlikely to rush to offer you more if you’ve already got a mass of cards and loans. So if you have a lot of credit cards in your wallet but are keen for a particular card, consider closing some of these accounts to make you more attractive.
Dealing with no credit history
While a poor or bad credit history will affect your chances of being accepted by any lender, having no credit history will also impact on this and could mean you’re limited to cards aimed at this situation. Unfortunately, many of these ‘credit builder’ cards have huge interest rates, and low credit limits. So if you do opt for one of these, make sure to repay the balance in full every month to avoid incurring nasty interest charges.