How to Apply for a Credit Card in 7 Steps

If you’re in the market for a new credit card, you can usually apply by providing some personal information — like your legal name and employment status — through an online application. But before you click on an “apply now” button, it’s important to know some common credit card terms and the types of credit cards that are available to you.

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1. Check your credit

Because credit card companies typically perform a credit check to determine if you qualify for a card and ultimately set your interest rate, it’s a good idea to know your credit score prior to applying.

There are several ways to check your credit score without negatively impacting your credit. For example, you can request a free copy of your FICO Score every 30 days through Experian, or sign up for a free credit score through LendingTree Spring.

In addition, the Fair Credit Reporting Act (FCRA) requires each of the three major credit bureaus (Equifax, Experian and TransUnion) to provide you with a free copy of your credit report every 12 months through AnnualCreditReport.com. Note, these reports are currently available online weekly.

Your credit report is not the same as your credit score, but the information contained therein is what your credit score is based upon. A close look at your credit report can give you valuable insight as to why your credit score is the number that it is.

You’ll also receive a copy of your credit report any time that a company takes adverse action against you, such as rejecting you for a credit card or loan.

Tip

If you find errors on your reports, you can file an online dispute or mail the dispute to the credit bureaus. Removing incorrect information may help improve your score before submitting a card application.

FICO Score and VantageScore are the two main credit-scoring models that lenders use when making credit decisions. Borrowers with higher scores are usually rewarded with better interest rates. Here’s a look at how the two compare and what a good credit score really is.

FICO Score

VantageScore

2. Learn important credit card terms

Becoming familiar with important credit card terms can help you determine if a credit card is a good fit for you before applying. Here are some common credit card terms and definitions you should know:

Annual fee: An annual fee is the cost some issuers charge each year to use their credit cards. Some credit cards have no annual fee, while others charge fees of $95 or more.

APR: An annual percentage rate (APR) is the annual interest you’ll be charged if you carry a balance on your card from month to month.

Balance transfer: A balance transfer is the process of moving debt from one or more credit cards to another credit card. Because these transactions often involve transferring high-interest debt to a card with a lower APR, they can typically help you pay down your debt faster while also saving on interest charges.

Cash advance fee: A cash advance fee is a fee charged to withdraw cash from your credit line. Still, it’s best to avoid cash advance credit cards, as they don’t offer grace periods and interest is calculated from day one.

Foreign transaction fee: Some credit card issuers charge a foreign transaction fee when you use your card to make purchases outside the U.S. or make a purchase online using a foreign currency. If you travel abroad frequently, it’s good to have a credit card with no foreign transaction fee.

Late fee: A late fee is the amount a credit card issuer may charge if you fail to make at least the minimum payment due by the billing due date. These typically range from $25 to $40.

3. Determine what kind of credit card fits your needs

Credit card companies offer different types of credit cards to serve different needs. Here are some options you could explore:

• Low-interest credit cards: If you plan to carry a balance on your credit card from month to month, a card with a low ongoing APR can help you save on interest charges.
• 0% APR credit cards: Whether you need to make a large purchase and pay it off over time, or transfer a balance from a high-interest credit card to get out of debt faster, a card that offers a 0% intro APR is ideal. Since these cards provide interest-free periods — often ranging from 12 to 21 months — they can help you save a significant amount on interest charges while you pay down your balance.
• Rewards credit cards: Rewards credit cards offer points, cash back or miles on eligible purchases. Depending on the card, you may be able to redeem those rewards for statement credits, gift cards, travel, merchandise and more.
• Business credit cards: If you’re a small business owner, there are a variety of business credit cards to choose from, including cash back cards, travel cards, 0% APR cards, no annual fee cards and more. In addition, these cards often offer business-related benefits, like expense management tools and free employee cards.
• Travel credit cards: Travel credit cards typically offer elevated rewards on travel purchases that can be used to help offset the cost of flights, hotel stays and more. These cards may also offer travel-related perks, like insurance or credits. The main types of travel credit cards are airline credit cards, hotel credit cards and general travel rewards cards.
• Credit-building credit cards: If you have poor or limited credit, these cards can help you boost your credit profile after you’ve demonstrated responsible card usage over time.

4. Compare credit card offers

Once you decide which type of credit card to apply for, you’ll need to narrow down your search results. Ask yourself these questions to help weed out cards that aren’t the best fit for you:

• Is it a card that offers the benefits you want most, such as no annual fee, cash back or an intro 0% APR?
• Do you meet the credit requirements?
• Are you okay with the fee structure, in terms of annual fees and foreign transaction fees?
• If you plan to carry a balance, does the card offer a low APR?
• Will you be able to meet the requirements for a sign-up bonus, if any?
• How much is the security deposit, if any?

5. Gather the required information to apply

When you’re ready to apply, card issuers may ask for the following information:

• Your full legal name
• Date of birth
• Your Social Security number (SSN) or Individual Taxpayer Identification Number (ITIN)
• Your residential address
• Your annual gross income
• Your employment status
• Your housing costs
• Your phone number

6. Prepare for some impact to your credit score

Each time you apply for a credit card, a hard inquiry will typically appear on your credit report and lower your credit score by a few points. A hard inquiry can stay on your credit report for two years — however, the negative impact will lessen over time.

There are cards available that don’t require a credit check when you apply. However, those tend to be secured cards that require a security deposit.

Tip

Several issuers offer prequalification tools that can tell you if you’re preapproved for a card by performing a soft pull of your credit — which won’t affect your credit score.

7. Choose a place to apply

When you’re ready to apply for a credit card, you can submit a credit card application online, in person or by responding to card offers that come in the mail. Here’s how each process works:

Online: Online applications involve filling out a secure form on the issuer’s website. While the length of time it takes to receive an answer may vary, this is typically the fastest way to get a response.

In-person: If the issuer has physical bank locations, you can apply in person during branch business hours.

Over the phone: You can call the bank or credit card issuer, and then complete the application process over the phone.

Mail: You can send your application to the credit card issuer through the mail. However, know that this method often takes the longest, since you’ll have to wait for the application to physically be sent to the issuer.

How long does it take to get a credit card?

The process of applying for a card varies. You may receive an immediate approval or denial, or your application could be placed under review. Once approved, though, many credit card issuers will send a physical card through the mail within 10 to 14 days. Plus, some companies, like American Express, give you an instant credit card number, so you can begin using your card right away.

What happens if I get denied for a credit card?

If your application is denied, don’t lose hope. Here are some steps you can take:

Find out the reason why Credit card companies are required to tell you why your application was denied. Review the explanation to find out if there’s an issue you need to address. You can call the reconsideration line and ask for your application to be reviewed again.

Improve your credit score Disputing negative records and establishing on-time payment history with other accounts, such as student loans, could help improve your credit score for future applications.
Lower your credit utilization ratio Paying off balances on other credit cards can help lower your credit utilization ratio — the amount you owe divided by your credit limit total. In fact, we recommend keeping your credit utilization below 30%.

Identify a card that better fits your profile Secured cards and credit cards geared to borrowers with average or fair credit could be easier to get approved for.

Wait a while Applying for cards back to back could result in multiple credit inquiries, which could cause a larger credit hit. Consider holding off on other card applications until you’re in a better position to qualify.