Credit Cards Becoming Harder To Get

Over the last six months, 2.5 million credit card applications have been rejected by banks – making it 10% more difficult to obtain credit than last year.

New research by Credit Confidential shows that it is becoming more difficult for consumers to obtain unsecured credit from lenders.

By comparison, secured loans such as mortgages are now 13% more likely to be rejected, meaning one in three people will fail in their secured loan application. This is the highest failure rate since the height of the financial crisis in 2009.

Failed applicants also face an additional challenge: ‘footprints’ in their credit history.

Each time an application is filed, it is noted on your credit history, which is shared among credit card companies. If they see you’ve been turned down elsewhere, especially more than once, they are less likely to approve your application.

Applying to multiple providers in quick succession will decrease your chances still further.

Independent credit checks

Consumers can avoid this by checking their credit rating to find out whether or not they qualify for credit before making an application.

Unfortunately, a third of failed applicants have no idea why they were rejected and make no further effort to find out.

It’s a mistake. If you have recently been refused a credit card, it could be an indication of identity theft, fraud or simply a mistake on your credit report. Each of these things can be fixed to improve your creditworthiness.

MoneyHighStreet.com comments: “If you are refused credit, be persistent – but be sure to apply for a credit card that suits your needs.

“In the current financial climate, it’s more important than ever to check your credit rating before you apply. Not only does this improve your chances of success, it can also help you secure a card with a lower APR – so you don’t end up paying more interest than you need to.”