Credit card applications are highly accessible, so it is easy to apply for a new card. While the process itself seems simple, common mistakes can result in instant rejections. Before you tackle your application in a hurry, consider five steps to make sure the bank approves you for your new plastic.
Fill Out the Entire Application
This sounds easy enough, but many consumers are rejected over incomplete credit card applications. Filling out applications online increases the prevalence of this type of mistake because you may easily hit the tab button too many times or accidentally pass over a box. Read through everything carefully and plug in any missing information before hitting the submit button. The same type of care should be given to mail-in applications to prevent rejections.
Before you're approved for a credit card, the company first has to determine that all the information you provide is accurate. Consumers lead busy lives these days, and it is easy to transpose numbers or accidentally write down an old address. Still, these easy mistakes can translate into instant rejection. Before submitting your application, read it a few times to make sure all your information is accurate. This will avoid future headaches in trying to fight a rejection based on inaccurate information on your part.
Understand Agreement Terms
When you fill out credit card applications, you have to agree to the terms. If the application is accepted, your card is sent to you, and in filling out the application you already have a contract with the bank. It is different from a personal loan in which you have to sign on the dotted line after gaining approval. Once you have filled out the application and gained approval for the card, there is no turning back unless you want to close the card and risk a decline of your credit score for closing the account.
Due to the instant contract an application entails, it is important to ask questions about the card if there is anything you aren't sure about. If the card has a low APR, for example, then you should ask the bank if there is ever a chance that the interest rate will increase over time and under what circumstances. You should also understand any late fees and overage charges. In addition, make sure there is room to grow with the card in the way of an increased credit line if you maintain good standing and on time payments.
Check Your Credit
The credit card application process will become futile if your credit score is on shaky ground. Lenders and credit companies aren't as quick to open new lines of credit for just anyone, especially after new laws passed under the Credit CARD Act of 2009. While such laws are designed to help prevent consumers from succumbing to unnecessary debt, it is now more difficult to apply for credit if your FICO score is low or if you don't have a steady income. For this reason, you should always check for errors in your credit report before filling out any application for credit.