How to Apply for a Credit Card (and Get Approved)

It's normal to feel a little nervous when you apply for a credit card. A credit card application may not be a life-or-death situation, but there's always the frustrating possibility it won't be approved. It can be especially nerve-wracking if you're applying for your first credit card or you've recently had an application denied.

Although you can't guarantee success, you can make it much more likely. Here's your step-by-step guide on how to get approved for a credit card.

1. Check your credit

Your credit score plays a significant role in the credit cards you can get. Every credit card is aimed at a certain range of credit scores. These ranges are usually referred to as bad credit, fair credit, good credit, and excellent credit.

To know which cards you qualify for, you need to check your credit. You can do this for free with an online credit score tool, such as Experian CreditWorks℠ Basic. These tools show you which range your credit score falls into and the factors contributing to your current score.

CHECK YOUR CREDIT: How to Find Out Your Credit Score

If your credit score is lower than expected, review your full credit report for any errors that could be affecting it. You're legally entitled to one free credit report per year from each of the three consumer credit bureaus, which are Equifax, Experian, and TransUnion.

2. Choose the right credit card

Picking the right credit card is the most important part of getting your application approved. If you don't have good credit yet or you don't have any credit history, then the best credit cards will be out of reach for now and it'd be a waste of time to apply for one.

So how can you figure out your credit card options? Here are a few tips:

Look for cards that fit your credit range. Here are the top options for all the different credit score ranges:

• Best Credit Cards for Excellent Credit
• Best Credit Cards for Good Credit
• Best Credit Cards for Fair/Average Credit
• Best Credit Cards for Bad Credit

Check with your bank or credit union. If you're new to credit, it could be easier to get a credit card with your own bank. Since you have a history there, it may be more willing to issue you a card. Here are a couple other types of credit cards that are good when you're new to credit:

• Best Starter Credit Cards for No Credit History
• Best Student Credit Cards
• Best Secured Credit Cards

See if you're prequalified for any credit cards. Several credit card companies have tools you can use to see if you prequalify for any of their cards. While a prequalification isn't a guaranteed approval, it does mean you have a good shot at getting that card. Here's how to check this:

• Go to the credit card issuer's prequalification tool. I've found the easiest way to do this is by searching the name of the card issuer and the words "credit card prequalification."
• Enter the required information. Card issuers usually just ask for your name, address, and the last four digits of your Social Security number.
• Check for offers. After you submit that information, the card issuer will show you any prequalified card offers it has for you.

3. Pay down debt

If you have debt, especially credit card debt, try to pay it down before applying for a credit card. While debt isn't a dealbreaker, a large amount can make credit card companies think twice about approving your application. There are two factors, in particular, they consider:

1. Credit utilization ratio: The amount of your total credit that you're using. It's calculated monthly by dividing your credit card balances by your credit limits. Since it's updated every month, you could raise your credit score in a short period of time by paying off high credit card balances.
   
   LEARN MORE: What Is a Credit Utilization Ratio?
   
   
2. Debt-to-income (DTI) ratio: Your monthly debt payments divided by your income. It's an important factor when applying for a mortgage, but it can also affect credit card applications. If your DTI ratio is too high, it can indicate you may have trouble paying an additional credit card bill.
   
   LEARN MORE: What Is Your Debt-to-Income Ratio?

Once you're ready to apply for a credit card, the simplest option is to apply online. You'll see an "Apply Now" option on the credit card's webpage. Click on that to start the application. Be prepared to provide the following information:

• Full name
• Date of birth
• Social Security number (SSN) or individual taxpayer identification number (ITIN)
• Mailing address (and your previous address if you've lived at your current mailing address for less than two years)
• Email address
• Phone number
• Annual income

5. Submit the application (and follow up if necessary)

At this point, you've done all the hard work. Double check everything on the credit card application, and once you're satisfied, submit it. The application will process, and you'll get one of these responses:

• Approved: Your application was a success. You should get your new credit card in the mail within seven to 10 business days.
• Under review: The credit card company needs more time to review your application. This usually takes a few business days. If you want, you can call in to check on the status of your application. You'll receive a letter with the card issuer's decision, and you may also get an email with this information.
• Denied: The card issuer didn't approve you. This is the response consumer's dread, but it's not always the card issuer's final answer.

It may surprise you, but it's possible to overturn a credit card denial. Call the card issuer and ask the representative if they can give your application another look. There's most likely a phone number listed either in your denial letter or email you can use. If not, the card issuer's standard customer service number also works.

Find out why your application was denied in the first place and explain to the representative why you'd be a good cardholder. For example, you could point out your strong payment history on other credit cards and loans.

You can even call the card issuer multiple times if necessary. I've had success this way when the first representative wouldn't help me. Remember, you only need one person to say yes and overturn that denial for you.

How to raise your credit score and get the card you want

When credit card applications aren't successful, it's often because of the applicant's credit score. In this situation, the best solution is to work on your credit, and then apply again later. Here's what you can do:

• Make all your payments on time. Late payments can lower your credit score, so it's important to pay everything by the due date. With credit cards and loans, on-time payments typically get reported to the credit bureaus and help your credit history.
• Cut your credit utilization. Like we covered earlier, this is one of the fastest ways to boost your credit score. Work on reducing your credit card balances so you're not using as much credit. Another option that can work is to ask your card issuers to increase your credit limit, because having more credit can also lower your credit utilization.
• Wait at least three months between credit applications. When you apply for a credit account, the card issuer performs a hard credit check. It only has a minor impact on your credit, but too many hard credit checks in a short span of time can cause you to be considered a higher-risk applicant.

GET A HIGHER CREDIT SCORE: How to Build Credit Fast

Still have questions?

Here are some other questions we've answered:

• How to Get Your First Credit Card
• How to Understand Your Credit Score
• Cash vs. Credit Card: Which Is the Better Way to Pay?