Will You be Accepted for a Credit Card? Here are the Key Considerations

Credit Card

There are a huge amount of credit card holders in the UK, with this number set to grow further in the years ahead.

As of 2016, there were an estimated 32.3 million credit card holders located throughout Great Britain. This is in comparison with the 50 million citizens who own and use a debit card.

Interestingly, there are millions more Brits who make unsuccessful credit applications on an annual basis. These individuals fail to meet lenders’ criteria. The issue is that failed applications can impact your credit score negatively. So let’s take a look at the key considerations when appraising your chances of being accepted by a lender.

Do you have a Good Credit Report?

You can review your credit score for free in most instances. Either by signing up with traditional service providers such as Equifax, Experian or Callcredit, or opening a complimentary online account with providers such as ClearScore or TotallyMoney.  

If you want to achieve a more detailed insight into your full report and credit history, you may be required to pay a small fee and receive this either electronically or by post.

This will offer the clearest indication of your credit score and eligibility. Essentially you are looking to determine precisely how attractive you are in the eyes of lenders.

What Type of Credit Card are you Eligible for?

If you deem that you are eligible for credit, the next step is to identify the product that is most suited to your needs.

Remember, the best rates and products are typically reserved for customers with the highest credit scores. Conversely, individuals with a lower rating may need to accept less favourable terms.

If you have a poor credit score that limits your chances of being accepted for a credit card. However, you may be best served by identifying specialist products that have been designed for you and similar customers.

Take cards that have been created for individuals with a poor score, for example. These cards can help you to build a history of positive lending and build your score in the eyes of lenders.

They also boast low limits and capped interest rates, creating a smaller debt that is easier to repay over time.

Have you Taken out a Large Number of Unsecured Loans Previously?

Outside of credit card borrowing, it’s also important to determine how many personal loans you have taken out in your recent history.

After all, these are also increasingly accessible in the current climate. Products such as short-term payday loans having caused particular controversy among financial regulators.

Now, if lenders can see that you have a history of regularly borrowing funds, they may decide that you’re using credit to support your lifestyle.

This means that they may decline a subsequent credit card application. This can even happen in instances where you have met monthly repayments and settled your debts.

Conversely, any late or missed payments are unlikely to impress lenders. They will also have a cumulative and negative impact on your credit score.

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