How We Make A Decision
We consider a range of factors, including:
- Your current level of borrowing and financial commitments.
- Your employment status and how long youve held your job.
- Your residential status, including how long youve lived in one place.
- Whether or not youre on the electoral register.
- Whether you have kept up with loan or credit card payments.
- The length of time you have held a current account.
What To Do If Your Application Is Denied
If you find that, despite your efforts, your , its not the end of the world. Its possible your application didnt go through for a number of reasons. Maybe your credit score or income is too low, or maybe you dont have the best credit history.
If you want to know why your application was rejected, lenders are required to tell you why you have been denied credit, either electronically, orally or in writing. This is called an adverse action notice, and it typically arrives in the mail seven to 10 business days after your denied application.
Being denied multiple times for a line of credit wont hurt your credit score. What hurts your credit score are the multiple hard inquiries during the application processthis will knock your score down a few points or more.
Before you apply for another new card, make sure you meet the minimum application requirements and know why youve been rejected before. This way, you likely wont get hit with another hard inquiry and a denied application. However, if you keep getting denied, go back to your initial research and look at what other options are on the table. For example, you could apply for a secured credit card to help build up your credit score to improve your chances of being approved for your next credit card application.
Improve Your Chances Of Approval
Before you apply for a new card there are a few things you can do to increase your likelihood of getting approved. First, clear up any outstanding debts. If you have any past due or delinquent accounts, pay them off as soon as you can.
Next, if possible, aim to decrease your ratio. If youre nearly at the limit on your other lines of credit, it will adversely affect your credit score. Ideally youd use 30% or less of your available credit across all credit cards and on each individual account.
Set realistic expectations and look for a card thats aligned with your credit score. Premium cards are generally designed for those with top-notch credit. If your score is more middle-of-the-road, consider a card thats meant for those with fair credit or good credit. Over time, your good payment behavior will help increase your score, and you may then qualify for a higher-end card.
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Emv Security And Your Personal Information
Many cards have what’s known as an EMV chip, which acts as a form of security to prevent your personal data from being stolen. This little chip, integrated into your card, generates a one-time code with each transaction. This keeps fraudsters from using your card. However, the chip can only protect you when you’re using the physical cardit can’t protect you if you’re using your card to purchase online or over the phone.
Applying For A Credit Card
Before you complete a credit card application, make sure you understand all of the terms and conditions that apply to the card.
If you apply for a credit card from a federally regulated financial institution such as a bank, the application must include an information box. The information box must present key features of the credit card such as interest rates, fees and other charges in a clear and easy-to-understand way.
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Mbna True Line Gold Mastercard*
People looking to reduce the amount of interest they pay should consider a low-interest credit card like the MBNA True Line Gold card. You wont earn anything for your spending on the card, but the interest rate is just 8.99%, which is significantly lower than the average of 19.99% most other credit cards charge. If youre currently carrying a balance on a credit card with a higher interest rate, then you should also consider taking advantage of the optional balance transfer at the time of application. Balances transferred wont be charged interest for a full six months, which could save you bundles.
- Annual fee: $39
- Purchase interest rate: 8.99%
- Balance transfer offer: Optional balance transfer at 0% interest for the first 6 months
NOTE: this offer is not available for residents of Quebec
Compare Credit Card Interest Rates
A credit cards interest rate may be an important factor if you regularly carry a balance. A balance is the amount of money you owe on your credit card. The higher the interest rate, the more interest you’ll pay on an outstanding balance. A lower interest rate card may save you money over time.
The interest rate may not be an important factor in choosing a credit card if you:
- pay your balance in full every month
- dont take out cash advances or make cash-like transactions
There are many credit cards with low interest rates available. Some low rate cards charge an annual fee. Even if there is a fee, a low rate card may be a better option.
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Getting Too Close To Your Limit Can Sink Your Credit Score
The percentage of available credit you use is called your . This is a major factor in your credit scores. When your utilization ratio creeps up too high if, for example, you have a balance of $1,500 on a card with a $2,000 limit your credit scores can take a beating.
The lower your credit utilization ratio is, the better. To keep your score in good shape, try to use less than 30% of your limit at all times. That way, you can be sure that whenever the issuer reports your accounts status to the credit bureaus, your balance wont be too close to your limit.
Apply When Youre Ready
New to CommBank or dont have NetBank? We’ll just need some of your personal details, photo ID and proof of income.
If youre already a CommBank customer and registered for NetBank, you can save time by confirming your personal details before providing your proof of income.
You can also apply for a credit card at your nearest branch. Just make sure you remember to bring your ID and proof of income.
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What Kind Of Credit Card Can I Get If I Have Bad Or No Credit
Those with a credit score below 650 will likely find it difficult to be approved for premium cards. However, there are a few different types of cards that you can still qualify for that may help you build your credit score.
Retail Credit Cards
One option is to apply for a retail credit card. A retail credit card is an offering created when retailers partner up with banks or banking networks to provide a credit service. Typically, retailers are less stringent on credit ratings and there have even been cases where they do not conduct a at all. Getting a retail credit card can also entitle you to discounts and loyalty rewards programs as long as you keep your account in good standing. A downside to retail credit cards is that interest rates tend to be higher, which will increase your interest expense if you do not have the cash flow to clear the account balance each month.
Prepaid Credit Cards
Prepaid credit cards are another alternative for those with low credit scores. These cards require the cardholder to top them up with cash before any purchases can be made. After funds have been added to the card, it can be used just like any other credit card. However, prepaid credit cards will not help you build your credit as it is not a credit product.
Student Credit Cards
Secured Credit Cards
What Is A Credit Card
A credit card is a transactional card that enables the holder to make purchases of goods and services or withdraw advance cash on credit. It is issued by banks and financial institutions to bring convenience of payment. Credit cards act as a micro loan tool where the individual makes purchases under the condition of paying off the same within a specific time period. There are no interest payouts if the due amount is paid within a specific time . A custom borrowing limit is pre-set by the issuer and this determines the maximum amount of credit a user can spend from a credit card. Credit card brings users the opportunity to save big through discounts and deals, making it a popular choice.
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Consider Calling The Issuers Reconsideration Line
If youve assessed the reason for your denial and determined that you werent far off from approval, call the issuers reconsideration line.
Now, if you applied for a card that requires excellent credit while having poor credit, you probably wont be able to talk your way to approval. However, you may be able to call the issuer and politely explain the situation, citing your timely recent payments and steadily improving credit. Theres no guarantee that youll be approved, but it doesnt hurt to ask. If you are approved, youll have the card you wanted and save yourself an additional credit inquiry.
What Are The Types Of Information You Need On A Credit Card Application
Here are some details youll typically need to supply on a credit card application, whether filling it out online or by mail.
- How long youve lived at that address
- Whether you own or rent your home or have another type of living arrangement
- Country of citizenship
Pc Financial World Elite Mastercard*
Due to its association with Loblaws stores and Shoppers Drug Mart, the PC Optimum program offers members access to a wide variety of ways to earn PC Optimum Points, including gas, drug store and grocery purchases. With an earn rate of 30 points per $1 in Loblaws-owned stores , 45 per $1 at Shoppers Drug Mart, and 10 everywhere else, this card is one of the best no-fee cards for gas and groceries on the market. Its simple to redeem points. You simply show the card at checkout anywhere PC products are sold and get $10 back for every 10,000 points. Theres even an included package of travel and car rental insuranceand it carries no annual fee.
- Annual fee: $0
- Earn rate: 30 points per $1 in Loblaws stores and PC Travel 45 points per $1 spent at Shoppers Drug Mart 30 points per litre at Esso and 10 points everywhere else
- Income requirement: $80,000 or $150,000 , as well as a $15,000 minimum annual spending requirement
- Additional perks: Travel insurance car rental coverage
For Flat Rate: American Express Simplycash Preferred*
If you want a cash-back credit card but dont want the fuss of figuring out how the spending categories work, consider the American Express SimplyCash Preferred card. You get a flat rate of 2% cash back on everything you buy, periodwith no limit to how much you can earn. Plus, for new members, theres a juicy 10% cash-back promotional offer for the first four months . Additional cards are free , which will appeal to couples or families who want to combine their reward earnings. The drawback to be aware of is that rewards can be redeemed only once per year.
- Annual fee: $99
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S Best Credit Cards To Apply For
Figuring out how to apply for a credit card is one thing. Determining which credit card to apply for is quite another. The best way to approach this task is to make a list of the credit card features that are most important to you. Prioritize, in other words. No credit card offers perfection across the board, after all.
Once you figure out what type of credit card youre looking for, youre all set. WalletHubs editors have already done the heavy lifting, comparing more than 1,000 offers to identify the best credit cards in the most popular categories.
Here are 2022s best credit cards to apply for:
Disclaimer: Editorial and user-generated content is not provided or commissioned by financial institutions. Opinions expressed here are the authors alone and have not been approved or otherwise endorsed by any financial institution, including those that are WalletHub advertising partners. Our content is intended for informational purposes only, and we encourage everyone to respect our content guidelines. Please keep in mind that it is not a financial institutions responsibility to ensure all posts and questions are answered.
Compare Credit Card Rewards And Benefits
A rewards card allows you to earn discounts on products and services or get cash back when you use the card to purchase goods and services. Credit cards may also come with benefits such as travel insurance or car rental insurance. You may have to pay an annual fee.
Before you choose a credit card for its rewards program or benefits, consider the following:
- if you carry a monthly balance, the interest youll pay may reduce the value of the cards rewards or benefits
- the cards annual fee may be more than the value you earn with points or miles
- how often you expect to use the cards benefits such as insurance for rental cars
Compare the rewards and benefits offered by different cards.
- how likely you are to use each benefit
- how long it will take you to earn rewards
- if you already have access to the benefit some other way
- if there are any restrictions or limitations that might reduce the value of the rewards and benefits
Read the terms and conditions of the credit card application and agreement carefully. Ask questions about anything you don’t understand.
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Consider Your Spending Personality
The right card for you will depend on what you want from your credit card and how you use it. Lets call this your spending personality.
Brand new applicants, or those with bad credit, are not shut out of the credit card game. If this is you, look into a secured credit card. In addition to the interest rate, also compare the sizes of deposit required and whether they have an annual fee.
If youre looking at cash back or travel, most rewards credit cards have accelerated earn rates on certain types of purchases. These spending categories can run the gamut, from groceries to drugstore purchases to streaming services. Your best bet is to review which cards offer the highest earn rates in categories you frequently use.
Dont forget to check out the perks. Some cards include benefits that can add up to hundreds of dollars per year. If you use your credit card selectively or you want to limit your credit card spending, then consider a no-fee rewards credit card, which will have fewer perks, but also costs you nothing to use.
If you carry debt, youll want to find the card that helps you pay it off fastest. In addition to looking for a card with the lowest interest, check for promotions. Some low interest credit cards offer promotions on balance transfers, which can buy you even more time to tackle your debt.
What Are The Benefits Of A Credit Card
- Reward PointsYou can earn reward points with every purchase made using credit cards. Subsequently, the accumulated reward points can be redeemed to make another purchase.
- Enhances Your Credit RatingPaying back your credit card bills on time is the easiest way to build your credit rating. If you have a high credit score, you can avail loans easily at a low-interest rate.
- Cash-Backs and DiscountsBy making purchases through credit cards, you can also earn cash-backs on select purchases. Some merchants also offer special discounts on credit card purchases.
- Frequent Flyer MilesAs a credit card holder, you can earn frequent flyer miles with every air ticket purchase. Ultimately, the frequent flyer miles can be redeemed against the price of another ticket.
- Universal AcceptanceAt times, debit cards even from reputed banks may be turned down when you travel abroad. On the other hand, a credit card is universally accepted as a convenient mode of payment across the world.
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If Youre Rejected For A Credit Card The Issuer Will Tell You Why
Getting rejected for a credit card is a bummer, but you can learn from it. Card issuers are required by federal law to send you an explanation for their decision, called an adverse action notice. For example, an issuer might say you were rejected because your income was too low, or you lack a credit history. This feedback could help you decide how to improve your chances for approval next time.
About the author:Claire Tsosie is an assigning editor for NerdWallet. Her work has been featured by Forbes, USA Today and The Associated Press. Read more
Example: Compare Low Interest Rate Cards And Standard Cards
Suppose you regularly carry a balance on your credit card. Your current credit card has an interest rate of 21% with no annual fee. You want to pay off your balance in one year and are considering switching to a low interest rate card with a 9% interest rate and a $50 annual fee.
|Type of credit card|
In this example, you’ll pay $273 less in interest with the low interest rate card. This is even with the $50 annual fee. Keep in mind that this example assumes you don’t use your credit card while you paid down your balance.
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