Five Tips to Keep in Mind Before Re-Applying After a Credit Card Rejection
Credit Cards are the cornerstone of modern lifestyle. With a single swipe, individuals can now make big purchases easily without having the money at the moment. Banks provide this facility to individuals with regular income and good credibility. Depending on your income level and credit-worthiness, your credit limit is set by the lender. However, if a bank feels that your credit history is not up to the mark, they might turn down your application when you apply for credit card. In such cases, here are some steps you should keep in mind to safely avail your credit card without hurting your credit rating and creditworthiness:
1.Review Your Application
The first thing to do when a bank rejects your credit card application is to check your application for errors in personal & financial details. If your account details or personal details are incorrect, the lender might reject your application on the basis of inaccuracy or misrepresentation.
2.Ask Bank to Reconsider
Before re-applying for a credit card, you should ask the bank regarding your application and find out the cause behind the rejection. During that process, you can refer to the terms of eligibility provided by the bank for credit card application. If the bank has a certain credit limit or income related eligibility criteria for application, you should refer to it before re-applying.
3.Check Your Credit Rating
Credit Scores are a significant measure that is used by banks for checking the creditworthiness of customers. If your credit rating is below 700, Banks might reject your loan or credit card application. If your credit rating is lower, then you should work on building your credit score till you re-apply for a credit card.
4.Work on Current Debts
One of the ways you can improve your creditworthiness is by ensuring timely payment of loans or credit card bills. If you have multiple ongoing debts, you should start by clearing the ones with the highest interest rate and then work your way down.
If you re-apply for a credit card immediately after a rejection, it will reflect negatively on your reputation and creditworthiness. Most lenders prefer if you wait for at least six-months before re-applying for a credit card. While it might be inconvenient for a short time, it will ensure that your long-term credit history is reliable and robust.