Credit Card Application

What is a credit card application anyways? It is what you have to fill out to notify credit card companies that you want a certain credit card. Applications usually take between 10 and 30 minutes to fill out from start to finish. Upon receiving your application credit card companies will look at your financial situation, maybe even do a quick background check and then they will either send you a credit card or they will let you know that your application was denied within a couple of weeks.

Why are credit card applications necessary? When you receive an unsecured credit card you are basically getting a loan from the credit card company of up to the maximum limit. Credit card companies make money from charging their cardholders interest [the APR you pay on your credit card] and from charging their cardholders fees [annual fees, late payment fees…] but they can lose money by loaning money out to one of their customers and never getting the money back. When their customers default on their loan credit card companies can lose thousands of dollars which really hurts the company. Therefore credit card companies want to make sure they are dealing with fiscally responsible people who will be able to pay back their loans on time. This is why one’s credit score, credit history, and employment information are so important when filling out a credit card application or any application for a line of credit.

There is no difference between paper and online credit card applications, each have an equal chance of approving you. Paper applications are “old school”, you will need a stamp and it will take you longer to hear from the credit card company because it will take a few days for the paper application to get to the company. Online applications have grown in popularity over the past decade and they are now more popular than paper applications. It all comes down to personal preference, but in my opinion I see no reason why you should not apply for a credit card online, it is quicker and easier in every way.

One thing you should know when applying for credit cards is your credit score. If you have a poor credit score, under 650, you should not bother to waste your time applying for credit cards that require great credit. While these credit cards generally have better interest rates, less fees, and better rewards programs you have virtually no shot at landing one of these cards if you do not have a spotless credit history. If your credit score is excellent, 750 or higher you should not waste your time applying for average-poor credit credit cards, simply put, you can do better. Knowing your credit score and what type of credit cards you should be able to be accepted for will make your credit card application process much more pleasant.

It is vital that you be honest on your credit card application. Do not purposely misinterpret any financial or personal information. While your credit score is very important to credit card companies as far as whether you get a card or a denial, other factors are important as well. Your yearly income is very important to credit card companies, they know they will be able to get their money back even if you are fiscally irresponsible as long as you make enough money each year. Lying on your credit card application is not only wrong, it is illegal. Credit card companies are not naïve, they know what they are doing and they will know if you lie on their applications.

The last words of advice I have for people regarding credit card applications is to be patient. While it cannot hurt your status to follow up on your application you should expect to wait a few weeks before hearing back from the credit card company. There are a few credit card applications on the internet that are “instant decision” “guaranteed approval” cards, but these cards are generally not worth having, they either have terrible terms or very high interest rates. Good things take time, you should not expect a credit card to receive your application, ensure all the information is accurate and make a decision on your application in a matter of days, it takes weeks sometimes. If two weeks go by and you do not hear from the credit card company about your application it would be a good idea for you to follow up and give the company a call, but be sure to be patient and understanding.

Applying for a credit card is not the best experience in the world but it is something that has to be done.