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Seven Things to Do If Your Credit Card Application is Denied

What to Do When You're Turned Down for a Credit Card

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You applied for a credit card and your application was denied. Now what? Having your credit card application denied is no fun. If you take the right steps, you could end up with a credit card after all. If not, work on your credit for a few months, then apply again later.

1. Apply again with caution.

Rejected' paperwork
David Gould/Photographer's Choice RF/Getty Images

The more credit card applications you put in, the more likely it is that you’ll get turned down again. That’s because additional inquiries on your credit report make you look desperate for credit. The good news is that it could take a few days days for the inquiries to show up on your credit report. If you want to apply for another credit card, do it soon. If you’re denied for a second credit card, hold off on the applications until you find out why you’re being denied.

2. Read your adverse action letter.

Within about 10 business days, you’ll receive a letter from the credit card issuer stating the specific reason your credit card application was denied. It could be related to something on your credit report. In that case, you’re entitled to review a free copy of your credit report to make sure the information in it is accurate. Or, you could be denied for a non-credit-related reason, like your income is too low.

3. Request your free credit report.

If your credit card application was denied because of information on your credit report, you’ll have 60 days to request a free copy of your credit report. Once you get your credit report, you can dispute any inaccurate information that may have caused your credit card application to be denied. After your credit report has been updated, ask the credit card issuer to review your credit card application. You can ask the credit bureau to automatically resend your credit report to anyone who’s reviewed it recently.

4. Review your free credit score.

Banks are now required to send a free credit score when your credit card application is denied. Unlike the adverse action credit report, you don't have to do anything to get your free credit score; the creditor should send it automatically. The free credit score will also list a few factors affecting your credit score, e.g. too high balances or too few installment accounts. Your credit score, along with the adverse action notice, will give you a better understanding of why you were denied.

5. Repair your credit.

Your credit card application may have been denied because you have bad credit. Unpaid collections, recent delinquencies, and high credit card balances are all things that need to be fixed before you can be approved for a credit card (or a decent one at least). Plus, once your credit is better, you’ll be in a better position to pay a credit card balance.

6. Apply for a retail store card.

Often, store credit cards offer approval when major credit cards don’t, even if you have a low credit score. If you get approved for a store credit card, you’ll likely start out with a low credit limit that can be raised based on your purchases and payment history. Interest rates are typically higher, so be careful about carrying a balance. Use a store credit card wisely can help you improve your credit score and qualify for a better card in the future.

7. Get a secured credit card.

A secured credit card requires an upfront security deposit to be made against the card’s credit limit. The deposit is placed in a savings account and only used when you default on your credit card payment. If you’ve made your payments on time for six to twelve months, some credit card issuers will convert your secured credit card to an unsecured one.

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