Anyone can now apply for a credit card by simply entering their information into an online form and clicking “Submit”. Getting approved for a credit card, however, requires some planning that starts long before you apply.
One of the most important factors is your credit score. There might be some slight differences depending on what bank you’re working with, but the scores are usually classified by lenders as follows:
300-629: Bad credit
630-689: Average credit
690-719: Good credit
720 and up: Excellent credit
Most rewards credit cards will require that you have either good or excellent credit. If you’ve struggled with your credit history, it would probably be a good idea to put off applying for a rewards card until you can get your finances in order. Do this by making payments on time, avoiding new debt, and keeping your current balances low.
Reduce your debt
They determine 30% of your credit score by how much you owe, so those high credit card balances are especially damaging. Your credit utilization ratio, which is your balance divided by your credit limit, should be below 30% on each of your credit cards. For example, if you have a credit limit of $10,000, keep the balance below $3,000 at all times.
By paying down an existing balance as quickly as possible, you can lower your credit utilization. You can also consider paying off purchases more than once a month in order to keep your total balance lower throughout the entire month.
Don’t apply for the first offer you see
Without good credit, they may not approve you for a large sign-up bonus or a lucrative reward structure. Every credit card application will end up on your credit report, so be confident that they will accept you before applying. You can always call the card issuer and ask about a specific card’s requirements to be sure.