As a young adult just starting out, you may not have a stellar credit score yet. While this can be frustrating, it doesn’t mean you are doomed to a life of limited credit card offers for the rest of your life. Getting your first credit card (and subsequent credit cards) is challenging because so many factors go into your credit score: age, current debt load, types and length of credit history, recent inquiries, and more. Things like having no established credit history or an inactive bank account can hurt your chances of being approved for new accounts. But it’s not all bad news - there are some tricks to get around these roadblocks so you can qualify for multiple great offers! If getting approved for a new credit card seems like a daunting task right now, don’t worry! There are plenty of ways to increase your chances of being accepted when applying for new cards. In this article we will cover the ins and outs of how to get approved for new credit cards when you aren’t sure if you have good enough credit yet.
Establishing Credit history
Credit card companies have several factors they use to determine your creditworthiness. One of the most important factors they look at is your credit history. This is one reason why it can be difficult for young people to get credit cards. There’s a standard expectation that you will have no credit history whatsoever and not much proof you’re financially responsible. If you have no credit history and you’re trying to get a credit card, you’re gonna have a really hard time. If you do have a credit history but it’s not great, you may still be able to get approved for a card but with a much higher interest rate than someone with excellent credit. The good news is that you can build up your credit history by getting a secured credit card. This is designed for people who don’t have any credit history. You put down a deposit that becomes your credit limit. The difference between this and a regular credit card is that the secured credit card company holds the money in escrow. This is because you don’t have a long enough credit history to demonstrate that you’ll pay back the credit card company.
Check Your Credit Score
Before you apply for a new credit card, you should check your credit score. You can do this for free through CreditKarma or CreditSesame. Alternatively, you can get a free credit report summary on AnnualCreditReport.com. A good credit score can make a difference in the cards you can get approved for. If you have no credit history, you may have to put down a deposit to open an account. If you have bad credit, you may be unable to get any credit cards. A credit score is like a report card for your credit. Having a good score demonstrates that you’re a responsible borrower. This means you can get approved for a wider variety of credit cards and better terms, such as a lower interest rate.
Get a Secured Card First
If you’re just getting started with credit and aren’t sure what your credit history looks like yet, the best way to get started is with a secured credit card. With a secured card, you deposit money into a security account. The money in this account is what the credit card company will charge you maxed out. For example, if you put down $500 as your deposit and you max out the credit card by charging $500, the credit card company will charge you $500. This is a great way to build up your credit history quickly. You can usually apply for these cards online, and you don’t need a long credit history to be approved. You may pay a significantly higher interest rate than if you had excellent credit, but it’s better than having no credit at all! Its best to open 2 secured credit cards this will establish your score faster than having just 1.
Fix Errors in Your Credit Report
If you want to get approved for the best credit cards, you need a pristine credit report. Unfortunately, many people have errors on their credit reports that can significantly lower their credit scores. If you have a low credit score or no credit history, it’s even more likely that you have errors on your credit report. You should definitely check your credit report to make sure it’s accurate before you start applying for new credit cards. Credit-repair companies can help you get inaccurate information removed from your credit report. This will help you get a higher credit score, which can make it easier to get approved for credit cards. If you have a low score and are trying to get approved for a credit card, you’ll likely need to put down a deposit. If you have errors on your credit report, you may be able to get those removed and have a higher score. If you can get your credit report fixed and have a higher score, you may be able to get the card with a deposit waived or lower interest rate.
Get a Co-Signer (Or Maybe a Parent)
If you don’t have any credit history or a low score, you may have to get a co-signer for a credit card. This is when someone else signs on to your credit card account to help you get approved. If you have a parent with good credit and they will co-sign with you, you may be able to get approved for cards that you previously weren’t able to get. If you don’t have a parent with good credit, you can get a credit card with a low limit like a secured card. This will help you start to build up your credit history. A co-signer is like a parent who signs on to be financially responsible for you. This means if you don’t pay the credit card bill, they have to pay it. If you have a parent with good credit, they may be willing to co-sign with you. This will help you get better terms and a lower interest rate. If you have a low credit score, you’ll likely need to start with a secured card.
Bottom Line
If you’re trying to get approved for new credit cards, the best thing to do is to start building up your credit history. This will show creditors that you’re a responsible borrower who pays back their debts. You can do this by getting a secured credit card that will help you to build up your credit history and a good credit score. You can also get a co-signer if you don’t have any credit history or a low score.
