Getting a credit card
When is the Best Time to Apply for a Credit Card? contents
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When you need to build or rebuild your credit history, applying for a secured credit card might help.
You may also want a new card to make a large purchase or transfer an existing balance to a lower-interest card.
You may want to wait if your income, age, and credit score don’t meet the minimum requirements.
When it comes to getting a new credit card, timing is important. Applying at the right time for you may improve your chances of credit approval. But how do you know when to take the leap?
The best time to apply for a new credit card depends on your personal financial circumstances, preferences, and credit needs. You may weigh several factors to determine when you’re ready to apply for a new card.
If the following situations apply to you, then the time may be right to apply for a credit card:
Your credit history plays a role in determining the personal loans, credit cards, apartments, auto loans, and mortgages you qualify for. Typically, lenders want to see that you have experience using credit and that you’ve managed your loans over the long term. Your credit history—including activity associated with credit card accounts—appears on your credit report and contributes to your credit score.
A credit card can be a valuable credit-building tool. If you’re just beginning to establish your credit history or working to improve a bad credit score, a secured credit card or student credit cards may help.
If you’ve only managed installment debt, like personal loans, opening a credit card account may also increase your credit mix.
The key to building your credit history is to practice good credit habits from the start, like keeping your credit utilization ratio low and paying your credit card bill on time each month. Before you complete a credit card application, make sure you’re prepared to manage a credit card responsibly.
With a rewards credit card, you may earn cash back or miles on every qualifying purchase. It’s an effortless way to get an additional benefit for shopping.
Ideally, credit card rewards allow you to get a little extra for something you were going to buy anyway. You may maximize your rewards by applying for a credit card that offers cash back on your everyday purchases. For example, a credit card with a high rewards rate at gas stations may be a good fit if you drive far to work each day.
If you’re not earning many rewards from your current card, it may be time for an upgrade. Or maybe you like your current rewards card, but you want to earn more. Some people also choose to carry multiple credit cards that offer rewards in different categories. If you already have a credit card that rewards everyday purchases like groceries, for example, you may consider adding a travel credit card to your wallet.
Some credit card companies offer bonus rewards for new cardmembers. By taking advantage of these promotions, you may boost your rewards earnings.
Your credit card issuer may require you to meet a certain spending threshold within the first few months after account opening to access rewards. Before you apply, consider whether you’ll be able to hit the minimum spending requirement. Discover doesn’t have that requirement.
All Discover cash back cards automatically come with Discover Cashback Match. At Discover, we’ll automatically match all the cash back you’ve on your credit card at the end of your first year. There is no limit to how much we’ll match.1
Certain credit cards come with a low introductory interest rate for new cardmembers. Applicants with a very good credit score may even qualify for a 0% intro APR. Any transactions you make during the promotional period accrue interest at the lower introductory rate.
If you have a large purchase planned (think appliances, vacations, or other major expenses), a new credit card with a low introductory APR may make it easier to cover those costs comfortably. But to avoid accruing interest, stay on top of your monthly payment. Any balance that remains when the promotional period ends accrues interest at the standard rate.
Applying for a new credit card with a low-interest balance transfer offer may also help you get your existing credit card debt under control, as long as you have a good credit score.
Did you know?
With a balance transfer credit card offer, you may be able to consolidate debt from multiple credit cards to one account with a lower interest rate and more manageable monthly payment.
You may receive a pre-approved credit card offer in the mail or your email inbox. Credit card pre-approval doesn’t guarantee credit approval. But it does mean the credit card issuer has determined that you meet basic eligibility requirements, so you may be more likely to qualify.
In some cases, it might make more sense to hold off on a new credit card application.
You may benefit by waiting until your score is a little higher to apply for a new card if you’re actively working to improve a low credit score.
A “bad” credit score doesn’t necessarily disqualify you from all credit cards, but it may limit your options. You might also only qualify for a higher interest rate or a low credit limit. If you’d like to open a specific rewards or travel credit card, you may want to apply after you’ve improved your credit score.
Be sure to check your credit score and understand your credit standing before applying for a new card.
Learn how the Discover it® Secured credit card can work for you
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The 2009 Credit CARD Act established age and income guidelines for credit card applications. You must be at least 18 to open a credit card account, and applicants under 21 need to demonstrate enough independent income to cover the credit limit.
Even if you’re old enough to apply for a credit card, credit card issuers still typically want to make sure you have enough income to manage your credit card debt.
If you don’t meet the age or income requirements, you may be able to build credit history by becoming an authorized user on a trusted friend or family member’s account.
A credit card may not make sense for you if the fees offset the potential benefits.
Discover has no annual fee on any of our cards. But some credit card companies charge an annual fee as a condition of membership. A credit card with a high annual fee may not be worthwhile if you won’t earn enough rewards or perks to offset the expense.
Other credit card fees to keep in mind include:
Understanding the fees you might pay can give you a clearer idea of how much a particular credit card may cost you.
Waiting to apply for a credit card may also be a good idea if you’re preparing to apply for a personal loan, student loan, auto loan, or mortgage.
When you apply for a credit card or loan, the card issuer or lender typically conducts a hard inquiry to access your credit report. A hard credit inquiry may bring down your credit score by a few points.
Multiple hard credit inquiries in a short time may cause more damage to your credit score. A lower credit score may affect your ability to qualify for a loan or receive the best interest rates.
The right time to apply for a credit card depends on your personal finance goals and your circumstances. Before you apply, make sure you understand how to manage credit card debt responsibly. You should also check your credit report and review credit card requirements. With Discover, you can see if you're pre-approved with no harm to your credit score.2 That way, you may be better prepared when the time comes to apply.
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