Credit cards are an awesome way to earn bunches of airline miles and hotel points. But what happens if your credit card application is declined? It can be frustrating, embarrassing, and lead you to question your credit score. Just because you have been declined, it doesn’t mean that you should give up. Here’s what you should do if your credit card application is declined.
Understand The Bank Rules
Banks are becoming incredibly more restrictive with credit card applications. Sometimes a decline has nothing to do with you and your credit. Here’s a quick primer on the major banks’ credit card application rules.
American Express
American Express has a “once per lifetime” rule. This rule limits applicants to receive the bonus only once for each credit card. Although the rule says lifetime, many people report being able to get the bonus again after seven years.
Capital One
Capital One limits cardholders to a maximum of two credit cards at a time. You must have your current credit card for at least one year before you can apply for another card. Applicants should space out applications by at least six months.
Chase
Chase is known for their 5/24 Rule. If you’ve opened five or more credit cards from any bank in the last two years, then Chase will decline your application. This includes lines of credit and being added as an authorized user on someone else’s account.
Citibank
With Citibank, you have a bit more flexibility as long as you space out your applications. You can apply for a second credit card eight days after your first and a third 65 days after the first.
Citibank will not grant a sign-up bonus if you’ve opened or closed a card within that family of credit cards within the last two years. For example, American Airlines AAdvantage or ThankYou points cards are two different families that offer multiple cards.
Click here for a list of our favorite travel rewards cards
If Your Credit Card Application Has Been Declined
Assuming that you were following the rules of the bank that you applied with, here’s what do you if your credit card application has been declined.
Call The Reconsideration Department
Just because your application wasn’t instantly approved online, that doesn’t mean you weren’t approved. About half of my online applications go pending. All this means is that your application needs to be reviewed by a person instead of a computer.
Wait 24 hours then call the bank’s reconsideration line. Say that you are calling on the status of your application. Then ask if there are any questions that you can answer to make a decision on your application.
Here are the numbers of several popular banks
| Bank | Reconsideration Number |
|---|---|
| American Express | (866) 314-0237 |
| Barclaycard | (888) 232-0780 |
| Bank of America | (877)-383-0120 |
| Chase | (888) 245-0625 |
| Citibank | (800) 695-5171 |
| Capital One | (800) 625-7866 |
| US Bank | (800) 947-1444 |
| Wells Fargo | (866) 412-5956 |
Check Your Pre-Qualified Offers
Banks want your business even if you don’t qualify for the credit card you applied for. On each bank’s website, there is a section where you can see what pre-qualified offers you are eligible for. The bank uses a soft inquiry when you use this process, so it won’t affect your credit score.
When you apply, you aren’t guaranteed approval, but there is a strong likelihood that you’ll get one of these credit cards.
Review Your Credit Report For Free
Federal law requires the credit bureaus to provide a free credit report for anyone that was declined for credit. However, you have to actively request your credit report within 60 days of your denial. The credit bureaus will not provide you with a credit report unless you request it. Review your credit report online or request a hard copy and look for any problem areas.
When you are denied credit you will receive a letter stating which credit bureau they used. You can only get a free credit report from the same bureau that was used in the decision-making process.
- Experian Customer Service: (888) 397-3742
- Transunion Customer Service: (800) 916-8800
- Equifax Customer Service: (888) 548-7878
Check Your Credit Score
When you receive your free credit reports, they will not include your credit score. The good news is that you can get your credit score for free from many places online. Sites like Credit Sesame and Credit Karma offer your credit score for free. And most banks now provide your free credit score in their app and online.
Additionally, the decline letter from the bank should also include your credit score.
Click here for a list of our favorite travel rewards cards
Review Your Decline Letter
Whenever a bank declines a credit application, they will make you a letter stating the reasons why. Unfortunately, the letter doesn’t highlight the specifics and is written with mostly boilerplate language by an attorney.
But there are some nuggets within the letter that will give you clues about where to focus when reviewing your credit report and your credit score. Many banks will also include your credit score in the decline letter.
Repair Your Credit Report and Score
Now that you know what problems the bank has with your credit profile, you know where to focus your efforts. If you have unpaid collections, levies, or past-due balances, get them corrected. Are there accounts on your credit report that you don’t recognize? You may be the victim of identity theft.
Or you may just need to focus on paying down your balances because your utilization is too high. A debt consolidation loan could help you focus on paying off your debt with the added benefit of increasing your score if you keep the paid-off account open.
Strengthen Your Credit Profile
Some people have done everything right. They just haven’t done enough of it. These people need to take steps to beef up their credit reports by adding some accounts that have a high approval rate.
Secured credit cards and retail store cards are the easiest credit cards to get approved for. The credit limit on a secured credit card is usually limited to the deposit you make with the credit card issuer. As you show responsible credit card use, the credit limit should increase and the card may be converted into an unsecured card.
Retail store cards may only be used at the retailer that issues it. Although they cannot be used at other stores, they are generally easy to get approved for. I have a Kohl’s credit card that was instantly approved. Not only was it easy to get, but it also offers some amazing discounts when I shop for the family.
Getting Declined For A Credit Card Happens To Everyone
If you’ve been declined for a credit card, you and I have something in common. I’ve been playing the credit card airline miles and hotel points game for years. My credit card applications get declined at least a couple of times each year. The same thing happens to many of my friends as well.
The next time your credit card application is declined, follow this list to pinpoint why. Then take the necessary steps so you’re in the best position to get approved the next time.
Have you been declined for a credit card application recently? Why do you think that was? And what steps have you taken since then to address the reason? Please share your story in the comment section below.
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If you really want to maximize your travel rewards check out Ultimate Guide to Credit Card Travel Rewards series!
