Excellent credit is certainly made a good impact on your credit card when you apply for one of them, however just because you have a good credit score doesn’t mean that your application will get approved. Many companies decide whether to approve and whom to reject despite a good score. Some of you may have faced of being denied for a new credit card even though your score is good enough for approval, right? You might get shocked, gets angry, and even shouted, “Why this happens to me despite having an excellent score?”
Well, the fact that your credit scores are important, but unfortunately, it’s not enough to qualify you for a credit card. There are also other factors that determine your credit card approval. And we are going look at them in this article, that why you could be denied for having a credit card despite an excellent score. Not only these factors are important in the previous days but still nowadays, they play a vital role in the higher chance of rejection in credit card applications.
So, instead of getting angry towards your credit card issuer or bank, take a look at the following factors to own below regarding your denied credit card.
Also read: 8 Top Best Travel Credit Cards of 2022
Table of Contents
Reason Behind the Denied for Having a Credit Card Despite an Excellent Score
We do a lot of research regarding the rejection application of credit cards even though people have an excellent credit score. At last, we came into the final reason through our research and listed the few important reasons. So, head through the following list down below to know why you got declined for a credit card.
One of the causes of the credit card rejection is maybe your income. Maybe your income is not sufficient for the credit card which you are applying. When you apply for the credit card, your application will be examined with all your personal document factors, which helps to make a final decision. If the card issuer finds out that your income level is below the minimum which is set by your issuer, you may face the rejection.
You should first figure out which credit card is suitable for you based on your level of income. But that’s the trickiest part just like a guessing game. So, don’t think that your good credit score only helps your application to get approved.
When you have a good credit card, you have to fulfill the requirements of the card issuer. But do not ever misrepresent your income for your approval. If your lie is detected by the card issuer, you may face the fine and even sentenced to jail.
Stuck in Debt
Your credit report says all whether you are buried down in debt or not. The credit card issuer or a bank whichever you choose – wants to know that you are capable of paying the monthly bill on time. Let’s say if you haven’t continuously made a payment, such as a mortgage payment, credit card payment, including other monthly payments, and then it will add in your credit report. And when the card company views your report, it will hit them like you are not fulfilling the monthly payment, result in credit card rejection.
Likewise, your card issuer will calculate all your monthly payments to your gross salary. If the calculated percentage is higher than 50%, your application more likely to get rejected, but if it’s below 40%, there is a good chance of your credit card approval.
However, it depends on the bank and the card company what types of debt should be included in credit card approval. Besides, the above ratios can also change according to the person portfolio.
But still, too much debt can lead to rejection of credit card applications.
Doesn’t Have Updated Credit Reports
If you don’t have a habit of reviewing your credit report, then you should. Let’s say you recently paid a high amount than usual. Your statement may not be shown on your credit report for the next few couples of days. That’s because it depends on your card issuer on how often they report to the credit bureaus. Sometimes, it takes time to forward your credit card report details to the bureaus, and your report can have outdated information.
Always check your report every month. This way, if you find any kind of outdated information, do contact the credit bureaus to remove the information. Your false information or error can remain on your credit card for up to 7 years. So, this can hurt your credit score history.
Multiple Credit Cards
Despite having a good credit score, having too many credit cards can also deny your application. That’s because when you have a multiple credit card, then your issuer may find uneasy regarding the card. You may be able to handle your different cards in a proper way; however, your card issuer may not want to handle the risk. Let’s say in the future, if you can’t handle your additional credit card bill payment, then your debt will rise in a rapid way. So, this kind of behavior has a negative impact on your credit company.
If you have multiple credit cards, then first properly utilize them for a couple of years. If you follow that then you can avoid Denied for Having Credit Card Despite an Excellent Score.
Locked Credit Reports
Some of you may not be heard about the frozen reports, right? Well, it’s a condition when a cardholder hides the payment information pattern and locks the report from seeing. When your report is frozen, your card issuer can’t pull out your credit report unless you provide the password to the credit bureau to unlock the report.
So, if you report your credit card before for a fraud issue, then the card issuer has to confirm your identity before they approve your application. This may be the reason that your application is getting denied because the card issuer can’t see your full report. So, previously if you have locked your credit card report then, do unlock your report and let it go.
However, if you still want to freeze your credit report, you can temporarily unlock it during the application process. For that, you even don’t have to pay any additional fees.
Multiple Recent Applications
Here’s a thing about the multiple credit application. Let’s say you apply for a credit card several times within a short period of time; your card issuer has approved your two or more cards. After that, you again apply for the next one, and that’s where the trouble begins. The credit card company inquiry your reports and can see the multiple credit card application. They might think that you are having financial trouble, and that’s why you are taking too much credit. When this kind of behavior hits the card issuer, they will reject your application for a new credit card.
Well, the credit card inquiry may not have that much impact on your credit score – which only works 10% of your score, but your credit report can talk. So, better not to apply for multiple credit cards within a short period of time. Take your time to your current credit card for about 2 to 3 years then only think about getting a new one.
Also read: Best College Student Credit Cards of 2022
Things to Do If the Credit Card Application Got Rejected?
Well, your credit card application is processed in an electronic system. A system automatically pulls out your credit history and checks the information of your credit card application. If the system matches your application to their predefined criteria, then you will get approved and, if not, then rejected.
In that case, you can call your card issuer through their phone number and talk about your application. You can properly explain about your credit history and personal details. If you pledge them well enough, then you may get approved.
In another case, if your application got denied, then the card issuer will send you a reason regarding a rejection in the letter. So check the letter and finds out why your application was not approved. In addition, you can also get a free score if your credit was used while accessing your credit report.
The most important thing, your credit score range is more necessary than the actual number. If your credit score is above 750 in the FICO then you are good to go but if your score is below 600 then you are highly like to be declined or rejected for a credit card.
Now, you might have a clear idea of why a person’s application can be denied for having a credit card despite an excellent score. If your application also got rejected, then try to solve the above-mentioned problem. After that, once again apply for a credit card, maybe this time your application gets approved.
So, your credit score always doesn’t play an important role in credit card application approval. If you are lucky enough, your application won’t be denied next time, but you have to follow the above-mentioned method.
Do you have any questions regarding the article? Throw them in the comment section down below.