Before applying for a loan or a credit card, you need to keep in mind that lenders will base their decision by looking at your credit score. If you have a low score, there are higher chances that your application might be rejected. Lenders tend to scrutinize the applications of new as well as current customers. It is not the major defaults that make lenders uneasy. There are other items that scare the lenders, and they will prefer to not lend you any money.

Multiple loan applications
It is not at all acceptable to apply for a large number of credit cards within a very short period of time. This immediately shows that you are not financially stable and are asking for money from everywhere. Credit card companies have a habit of monitoring all your accounts, and if you have made a large number of applications, they will not be happy.

Somebody else’s debt
Whenever you sign a loan with a co-applicant, you need to keep in mind that the debt will be a part of your credit report, and if your co-applicant defaults on a payment, the same will be a part of your credit report as well.

History of minimum payments
No lender would like to see a history of only minimum payments made by you. This is a sign of financial instability and shows higher chances of default. Paying the minimum amount on rare occasions is acceptable, but making it a habit is not acceptable to lenders.

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Credit inquiries
Every time you make an application, the lender will review your credit report, and this could lead to a hard inquiry on your report. Hard inquiries are shown on the credit report, and the number of such queries has an impact as well. If there are many queries on your report, you could face problems.

Cash advances against credit card
Cash advances taken on a credit card show that you are not financially stable and are desperately looking for funds. The amount of advance you take will be added to the debt and will eventually reduce your credit score. Avoid taking an advance for as long as you can. It is a sign that your creditworthiness is low, and lenders would choose to stay away from lending funds to you.

Whenever you apply for a credit card, keep these five items in mind. Stay away from debt if you want your credit card to be approved at the earliest. A good credit score helps your mortgage or credit card application. If you have a good credit score, your application will be processed and approved at the earliest. However, even if you have a low credit score, you can build it by taking financially responsible decisions and making your outstanding payments in due time.

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