It might be awhile before you’re getting a constant barrage of email and traditional snail mail exclaiming how you’re pre-approved for a new credit card and practically begging you to complete the signup process.
Yes, in the wake of the COVID-19 pandemic, lenders are likely to be tightening their purse strings a bit and becoming more restrictive as it pertains to who they approve for new credit cards. The highly qualified consumer with outstanding credit and a steady, reliable income likely has nothing to worry about, but those with good to average credit, or those who have faced financial hardship from the pandemic, are another story.
The good news is there are a few quick ways you can give yourself a better chance at approval if you want to take advantage of some of the great offers that credit card companies are offering. Here’s a look:
Improve Your Credit Score
If your credit score is poor or average, we suggest committing to a repair strategy that can put it in the “good” to “excellent” range. There are a variety of simple ways you can do this, including:
- Ensuring you’re paying your bills on time.
- Getting your credit utilization ratio to 30 percent or less.
- Disputing any negative marks on your credit report.
- If applicable, asking for a higher credit limit (sometimes this can help lower your overall credit utilization ratio and help your score).
Demonstrate Verified Income
When you apply for a mortgage or auto loan, it’s common for lenders to want to see pay stubs so they’re sure you’ll be able to repay them according to the agreement. Credit cards have a little bit more leniency, but lenders still usually want to see some sort of demonstration of verified income. Even if you’re among the millions of Americans out of work, you can still get accepted for a new credit card so long as you can prove that you can adequately pay it.
Aside from a pay stub, alternative sources of income that you can provide include:
- Unemployment benefits
- Spousal income
- Returns from investments
- Child support/alimony that you receive
- Social security checks
Don’t Let Your Guard Down
Lastly, we strongly recommend that you stay on top of your financial situation – not just as it pertains to credit card approval, but for any type of loan approval. Right now, this is easier than ever. In fact, you’re privy to one free credit report every week from now through April 2021 from each of the three main credit bureaus. Being that it’s estimated as many as 20 percent of consumers have some sort of an error on their credit report, it behooves you to get into the habit of regularly checking this report for any inaccuracies. Inaccuracies may not just hurt your credit score, but they could throw up a red flag for any lenders you’re hoping for approval from.
