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- Have you been having trouble getting approved for credit cards? It could be because your credit isn’t in the best place — even though some credit reporting services might say you have good credit.
- If you don’t have a credit history, have more credit card debt than long-term debt, or have some negative marks on your credit report like bankruptcy, you could be denied for the best credit card offers.
- By understanding how negative points are preventing you from getting more approvals, you can make changes that will improve your odds over time — allowing you to earn more rewards for your everyday spending.
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If you have "good" credit but keep getting declined for big points and miles bonuses from credit cards, or have noticed a decline in "pre-approved" offers coming to your mail, it may have everything to do with your credit report.
It is entirely possible to believe your credit is in a good place, but banks and other lenders may see it otherwise.
Getting your credit score through one of many different free services may present an optimistic view of your credit history and current situation. However, while you pay your balances on time and try to use your available balances responsibly, your reports may not be as stellar as you think. The result is often lower FICO scores and mixed reviews of your position across all three credit bureaus — resulting in rejections.
What’s holding you back from getting the credit you deserve? More importantly, how can you improve your situation and start receiving rewards for your spending? Before you put in another unsuccessful application, start by checking these three situations.
You don’t have a credit history
Before banks will trust you with a line of credit of your own, they want to make sure that you can handle the responsibility. With a track record of good spending and low balances, you may qualify for the biggest bonus offers and best credit card rates. Until that time comes, you may get denied for the best credit card offers.
If you’re just building your credit history, or rebuilding after a bankruptcy or charged-off debts, then consider your application strategy carefully.
Earning rewards from the top-tier credit cards is a marathon activity — not a sprint. Before applying for the best cards in the industry, start with cards that offer no annual fee and cash back to build a solid report. Through good usage and regular spending, it’s rather easy to work up to the top-tier credit cards.
You have too much ‘bad’ debt
When banks look at a credit report, they consider two different types of debt: good debt and bad debt. "Good" debts are long-term loans on big purchases, like homes, autos, and even student loans. If you have one of these in your name and are responsibly paying them down every month, both your credit score and overall report are in a much more favorable space with lenders.
On the other hand, "bad" debt is your current balance on credit cards or store credit. High balances and late payments can make your credit score suffer and disqualify you for the best credit card options. Before putting together another application, start paying down your balances to get your credit in a better place.
It’s important to note that "good" and "bad" debts are not mutually exclusive. If you have many different credit cards but your overall utilization is low, then your credit score will go up and put you in a prime position to get the best credit cards. But if you have only two or three credit cards that are always used to the max, your credit score will go lower.
Your credit history isn’t stellar
Everyone falls on hard times.
With a bankruptcy or debt write-offs on your credit report, lenders may wary about approving you for their best credit products. The good news is that everything passes with time — including bankruptcy. If you have bad marks on your credit today, it’s okay. Most negative reports fall off your credit report in seven years.
What’s more important is how you treat your current lines of credit during that time. By keeping low balances and making responsible purchases, you can get approved for better credit card offers, resulting in more rewards you can use in your everyday life.
- Read more about credit:
- How to cancel a credit card you no longer want
- Paying off your credit card can quickly improve your credit score, but it has another benefit that might feel even more important
- I have 26 credit cards and excellent credit. Here’s the best advice I can give you on keeping up your score, no matter how many cards you have.
- Your credit score is based on a complicated, murky calculation, but you can fix it by focusing on 2 easily controllable factors
- Experts say canceling a credit card can do more harm than good, even if you don’t use it often
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