Credit Card

8 Reasons Credit Card Application Declined

There are many possible ways to apply for credit card, either online or directly from a financial institution. Whatever way you applied for it, I want you to know that the issuer will undertakes a certain approval process before issuing the card. However, what could cause your application to be declined or rejected?

Why credit card application declined and solutions
Every issuers takes various factors into consideration before deciding whether to accept or decline a credit card application. But they rarely tell you immediately their decision. Instead, they’ll send you a mail within 7-10 business days, describing better their decision about your application whether it was accepted or declined.
In this article, I will share with you some possible reasons your credit card application can be declined.

Reasons Credit Card Applications are Declined.

 

1. Bad Credit Scores

 

What is Credit Score?

According to Investopedia, a credit score is a number between 300 to 850 that determine an individual trustworthiness. So, the higher the score, the better a borrower take potential lenders. Credit Score is determined by Credit history; total level of debt, number of account opening, loan repayment history and other factors.
So, how does this affect credit card application? – Most financial institutions uses credit scores to determine trustworthiness of individual customers and they have a different score rate. However, a good credit score should begin from 750+.
Moreso, your credit score will be negatively affected if;
  • You have requested for credit card from various institutions
  • You have applied for loans with various institutions
  • You don’t pay your EMIs early
  • Usually default on repayment of loans
Also, it is not advisable not to have a loan history, this will affect your credit card application – institutions will be blindfolded about your trustworthiness.

2. Default in Loan Repayment

As I have said earlier, when customer begin to skip repayment of their loan, their credit scores rate decreases and a chance to get a credit card from a financial institution will be very low.
Also, Don’t apply for too many loans from different lenders, this will also affect your credit score negatively which could lead to credit card application declined.

3. Low Income

Like I said earlier, financial institution uses many factors to decide the acceptance and rejection of credit card applications. Income eligibility criteria must meet the issuer requirements, as the applicants must submit all necessary documents regarding the income information such as; salary slips, form 16, income tax returns etc during the application.

4. Bad Use of Previous Credit Card

If you spend more then your available credit, especially when you are maxed out, this could affect your credit card application negatively.  So, it’s advisable to keep your balance below 30 percent – which is good for your credit score and more advantages to get your application approved fast.
Applying for too many credit card with in a short period of time is a bad ideas and can get your credit card application declined. So minimize your request to avoid spamming or not request.
Having a charge-off on credit card could cause rejection in the application. – a charge-off is a credit card debit that went unpaid for six (6) months or more. If you don’t pay your down debit, how will you expect another credit from a company?
Having a limited credit card history can also cause the rejection. Many Credit Card issuers will love to see your previous card history before offering another one. So if your history is not convincing enough, it might lead to credit card application declined.
Furthermore, having too many credit cards can cause the declined of your application. Avold having too many credit card to boost your credit score.

5. Occupation

Credit Card issuers also use this term as one of their factors when considering whether to accept or decline credit card application. Job position of the applicant matters, even when the fulfil the minimum creteria required. Reputation of a lender is to consider repayment capacity of an applicant before offering a loan or credit card. No institutions will approve a loan or credit card to applicant with unstable job history.

6. Too Young to get a Credit Card

Credit Card Applications are available to 18 years and above. So, you application might likely be declined unless you own an income history or request for it – manage under your parents or guardians.

7. Mistake in the Application Form

Nobody without mistake right? If applicants do any mistake in their application form, though it might be a minor issue for them, but this could cause the issuer to reject your credit card application. So when filling the form, you must be extraordinarily careful not to do any mistakes must especially in some vital information like; physical address or date of birth. That is why I told must of my readers to apply for credit card online, because online credit card application prompt applicant to fill in missing mandatory field that was omitted.

8. Address Verification Failed

Before you get any approval of credit card from an institution, they must have confirmed your submitted address to see if anything is wrong with it. A representative will go to the specification and confirm. So make sure you submit an accurate and physical address in your credit card application form.

How to Ensure Your Credit Card Applications Isn’t Declined

Many Financial institution (credit card issuer) did not normally disclosed the reasons behind the rejection of credit card application. However, the applicant should note the term and condition laid down by the card issuer. Here are steps to take when applying for credit card to ensure the application didn’t get declined.
  • Maintain and try get a good credit score
  • Keep record of good balance on your credit card and minimum request rate for new ones.
  • Include your other means of income when submitting your income eligibility information. This will enabled and increase your chances approval.
  • Before submitting your credit card application form, recheck your information for error or mistyped spellings.
  • Make sure you pay any available loan on time to avoid default that will reduce your credit score rate.

Conclusion

Credit Card issuers uses many factors to consider whether to accept or decline credit card application. However you must be wise while submitting the form and make sure you meet all their requirements to a get a credit card. Read and understand their terms and conditions – if you have all with it takes to get the application approved, you will surely get it done. Share this article via the social icon before and be free to ask questions. I will respond as soon as possible.
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