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Opinions expressed here are the author's alone, not those of any bank, credit card issuer, airline or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

By Jason Steele
August 18, 2020
Chris Gash for Money

Ever since the COVID crisis impacted the U.S. in 2020, credit card issuers have made it more difficult to be approved for new cards. In fact, they’ve even reduced the credit limits of some existing cardholders.

But don’t give up hope, as card issuers are still willing to approve new accounts under the right circumstances. What you need to know is that if you’re applying for a new credit card, it’s never been more important to take every possible step to maximize your chances of being approved.

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How to Apply for a Credit Card and Get Approved

1. Check your credit score and only apply for cards you’re qualified for. If you’re new to credit, or you have serious problems in your credit history, then now isn’t the time to apply for a premium rewards card that requires excellent credit. Instead, check your credit reports and credit score, and find a suitable card for your credit profile. Thankfully, you’re entitled to receive copies of your credit reports from AnnualCreditReport.com, and there are many free services that will show you your credit score.

2. Pay down your existing credit balances. Opening up a new credit card account is essentially the same as asking for a loan. And as the old saying goes, banks only want to loan money to people who don’t need it. When you have very little apparent debt, your application for new credit will be looked on more favorably. So, before applying for a new credit card, you should pay off all of your existing credit card balances, or at least pay off as much as possible.

About half of all American credit card users avoid interest charges by paying their statement balances in full. Still, many of them would be surprised to learn that their monthly statement balances are listed on their credit reports as debt. But if you pay off your credit card balances before your statement closing date, then your credit report will show no debt, which will help your application for new credit. Just make sure to wait until a few days after your statements close before apply for a new credit card, to give time for the new balance to be reported to the major consumer credit bureaus. Paying down your balances before your statement closes may also increase your credit score, which will improve your chances of being approved for a new card.

3. Pay special attention to balances on other accounts from the same card issuer. Credit card issuers will be very hesitant to approve you for a new card when you already have a large outstanding balance on another one of their cards. For example, if you’re applying for a new Chase credit card, then it can help your application to first pay off any balances you have with other Chase cards. Unlike paying off balances with other card issuers, you only have to wait until your payment is credited to your account, as the card issuer will see it immediately.

4. List all available household income on your application. In 2013, the Consumer Financial Protection Bureau (CFPB) ruled that applicants for new credit who are 21 or older may list income from their spouse or partner, so long as they have a reasonable expectation of access to it. This means that you can apply for cards using your spouse or partner’s income in addition to your own. Furthermore, be sure to list all available sources of income, including child support, spousal support, government benefits and investment income.

5. If you’re not immediately approved for a new card, follow up immediately. While some credit card applications are immediately approved, many people will see a message saying that they should expect a decision in the mail within a few weeks. However, you shouldn’t wait that long. If your application isn’t approved right away, contact the card issuer to discuss the application. It may surprise you to learn that many card issuers empower their representatives to make credit decisions over the phone.

In fact, the representative you speak to may even be incentivized to open new accounts, so the two of you may be on the same team, so to speak. The card issuer will want to approve your new account, so long as it can minimize its exposure to default. During the call, you can explain that you’re seeking to enjoy the rewards and benefits of the new card, rather than fully utilizing a new line of credit. If you have additional accounts from the same card issuer, you can offer to transfer a portion of your credit line from an existing account to the new one, or perhaps even close an unused account. That way, the card issuer isn’t increasing its risk, and is much more likely to approve the new account.

Other times, you may simply have to answer questions over the phone regarding your income and other financial information before being approved.

6. If your application still isn’t approved, ask why. Whenever you’ve had an application for new credit rejected, the law says that credit card issuers and other lenders are required to let you know why. The reasons can be that you have high balances, too many accounts, too many recent inquiries, not enough income or, of course, low credit. Sometimes, there are even more mundane reasons like listing an unrecognized address, or the inability to verify your identity due to a typo or other mistake. Thankfully, some of these problems can be addressed quickly, so it’s always worth it to follow up with the card issuer to ask if there’s anything that you can do to be approved.

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Bottom Line

These are tough times for many Americans, but credit card issuers are still willing to open new accounts for qualified applicants. To increase your chances of approval, you’ll want to put your best foot forward when applying for new credit, and follow through if your application isn’t immediately approved.

More From Money:

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It’s Suddenly a Lot Harder to Find a New Credit Card. Here’s How You Can Still Get Approved

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Advertiser Disclosure

Money has partnered with CardRatings.com and ConsumersAdvocate.org, among other companies, for our coverage of credit card products. Money, CardRatings.com, and ConsumersAdvocate.org may receive a commission from card issuers. For example, Money receives a commission from Citi when you apply and are approved for a Citi product through the links on this site.

Opinions expressed here are the author's alone, not those of any bank, credit card issuer, airline or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

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