Were your high hopes for that rewards or cash back card crushed when you got the response: credit card application denied? Not to worry, there is plenty you can do to get back on track to getting the card you want.
1. Ask Why Your Credit Card Application Was Denied
In most cases they will tell you in the response sent to you when your application was denied. There can be many different reasons, from your income to your current credit score. Occasionally, there is a mistake on the application that you made, and you can contact the credit card company to have the error fixed and reapply for the card. Asking why will let know what you need to work on in order to get the card you want.
2. Check Your Credit Score
Credit card companies are required to send you a free credit score report as part of your denied application. If this does not come with your credit card denial letter, contact the credit card company and ask for it. Another way to obtain your credit score is to look it up yourself. You are entitled to 3 free credit reports a year. You can obtain a free report of your credit score from sites like freecreditscore.com. You will have to sign up for membership to their service, but as of this writing, they are offering a free 7-day trial. After you receive your score, you can cancel your account and avoid any costs. If the reason for your denial was a low credit score, you now know how much work needs to be done to repair it.
3. Apply For Another Credit Card
Be careful though, too many applications for credit cards in a short period of time may make you look desperate for credit, lower your credit score, and increase your chance to have another credit card application denied. You might be better off obtaining a card which has a lower credit score requirement or a secured credit card. Secured credit cards require an upfront deposit that acts as your credit limit and will be used if you default on your bill. But, if you keep up with your payments, you will see your credit score improve and you can get your deposit back when you close out your account. Another avenue you can take is to obtain a gas or retail credit card. These issuers are more likely to approve you, and it can be used to build up your credit as long as you pay your bills on time. Be careful though, these cards typically carry a very high interest rate so be sure to pay your balance in full each month. This will increase your chances to not have your next credit card application denied.
4. Close Out Any Outstanding Credit Card Balances You Have
If you already have a credit card with an outstanding balance, that could very well be the reason your credit card application was denied. Work to pay off the debt on the card, but do not close the account. One of the factors in your credit score is the length of your current credit history. You can leave your paid-off credit card in a drawer at no cost to you (as long as there is no annual fee) and use it to help build your credit score.
5. Give Your Credit Score Time To Rebuild
It can take anywhere from 6 to 12 months for improvements you have made to your credit to show up on your credit score. This may seem like a long time, but the sooner you start, the sooner you can get the card you want and start reaping the benefits. From the best cash back credit card, to lower interest rates based on your credit score, making it a goal to obtain the card you want is very beneficial. After obtaining the credit card you want that comes with free airline flights, gift cards, or cash back for purchases, work hard to keep your credit score high and you will probably never have to worry about getting a credit card application denied message again.