The days of easy money are long gone. Banks and building societies are now very fussy about their customers, so you might find it harder than you were expecting to get a credit card.
Check your credit file
When you apply for a credit card, your credit history is key and if your credit score isn’t high enough your application will be turned down.
There are a number of things you can do to increase your chances of approval. First, make sure that your name is on the electoral register at your current address.
Next, check that your credit file is up to date by contacting one or all of the big three agencies – Call Credit, Equifax, and Experian. If there are any errors or inaccurate information, make sure they are corrected as it could affect your score.
You will lose points if you have previously missed any loan payments, such as your mortgage, or if you have struggled with debts in the past. So try to manage your money carefully. Set up direct debits to ensure you always pay bills on time and if you’re running into problems and struggling to keep up with your bills, contact your providers as soon as possible.
If you make an application that is declined, the temptation may be to apply for another card. But multiple applications within a short space of time can set alarm bells ringing with lenders – it might signify that you’re desperate for money.
Cards for low scorers
Anyone with a low credit score should not give up hope. There are a number of cards aimed at people with a poor credit history. The cards usually charge high interest rates of 30% or more, but if you always pay off your balance in full each month, you need not pay any interest and can gradually start to improve your credit score.
Personalise your search
Card issuers save the best deals for the best borrowers. The leading 0% offers will only be available to those with excellent credit histories so there’s no point in applying if you have little chance of being accepted. This is where MoneySupermarket can help. To find out which cards you'd be accepted for without affecting your credit score, try our quick and easy card search.
You can further boost your chances of success by cutting up and cancelling credit cards you no longer use.
Another option is to take a prepaid card which comes with a Creditbuilder facility. This works by the card provider effectively ‘lending’ you a full year’s worth of monthly card fees in advance. You won’t pay interest on the loan but will be required to pay it back over the course of the year. Details of your payment reliability will be passed to credit reference agencies and – providing it’s good – will help boost your credit score. In other words you can help yourself, without running the risk of getting into debt or paying a penny in interest.
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