Being denied is always painful whether it’s a school dance or a rejected loan. As the economy works itself out of a recession, creditors have cut back on credit card solicitations and are not doling out the approvals like they used to for those that do apply.
If you’ve been denied credit, the first place to look is your credit report. If you need help assessing your report, a credit counselor can help make sense of it in and help you improve your credit worthiness.
Recently rejected while applying for credit? Read on to find out what are the top reason for being rejected and what a person can do to get approved the next time.
The Top 5 Reasons Credit Card Applications Are Rejected
- Delinquent credit obligations. Late payments, bad debts, or legal judgments against you.
- Credit application is incomplete.
- Too many credit inquiries. (Generally more than four in six months.) Inquiries are made whenever you apply for credit.
- Errors in your credit file.
- Insufficient credit file; too few or no transactions in your record.
Take Charge: If you have no credit history…
- Open up a checking and savings account, if you don’t have one.
- Apply for a secure credit card and pay it (and all your bills) on time.
- Go after the “small fry” of department store credit cards.
- Keep spending to under 30% of your credit card balances.
If you have less-than-optimal credit…
- Verify the accuracy of your personal information (name, social security, address, length of time at your job and residence). Look for accounts listed that aren’t yours, make sure all the accounts you pay on time are reported, and follow up with creditors and the bureau to make sure any errors or omissions are corrected and posted immediately.
The Little Things Count. What you think is a harmless or even beneficial act on your credit report can actually hurt your credit score. Some of these acts include:
- Closing accounts
- Opening one or more accounts in any year
- Transferring credit card balances
- Settling debts
- Incurring library fines, parking tickets or other penalties seemingly unrelated to credit
If you’re unsure how to contest the creditor’s decision to reject you, consider working with a credit counselor who can help you rebuild your credit and reduce the likelihood of future rejections.
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Tags: Credit Counselors, Credit Help, Credit Scores, Debt Consolidation, Debt Relief, Personal Finance
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