Why You Should Not Apply for Too Many Credit Cards At Once

Do not apply for too many credit cards even though you realize that they are important to have. Life in the modern time is almost unthinkable without the usage of credit cards. Credit cards are not only essential financial tools many do not have ready cash in hand but also facilitate transactions which are otherwise not possible without a credit card such as online shopping, hotel booking, buying airline tickets etc. However, you must bear in mind that you should plan out your credit card applications in a way that you do not apply for more credit cards than you actually require. If you have made a couple of credit card applications you should wait till you get the result of those applications. Applying for too many credit cards all at once in the hope of qualifying for at least a couple is harmful to your credit rating. Paying too many credit applications in a short amount of time is viewed as a risk by the credit scoring model. It signifies financial trouble of a person who is trying to make up for his lack of income by applying for credit. Somebody applying recklessly to credit signifies a person who is liable to get himself under a law to debt in a short amount of time and is thus a risk to the lenders.

If you have made a credit card application and it does not get approved you should typically wait a couple of months before making any more credit card applications. If you’re fairly confident of getting approved of the credit card application you should wait before you actually know if you have been approved or not. Do not apply for more than two credit cards at one point of time.

It is a general rule that a credit check for approval of credit card can lower your credit score by as much as five points. Apart from this having gas credit cards or stored credit cards such as Sears, Macy’s etc has the potential of lowering your credit score even further and by as much as 20 points or credit card. Hence, contrary to popular thinking credit card approval is not necessarily good for your score.

It is thus advised to always check the credit card features and apply for the ones that best it your needs. Store cards and gas credit cards are usually not advice since they only offer savings on shopping on a particular store but then the high interest rate on revolving balance can offset the advantage easily.

Apply for credit cards and seek approval only when necessary.

Although you may get tempted and it may seem exciting to apply for credit cards while the offer is presented, the practice is not healthy for your credit score. Keep your credit applications to the minimum especially if you ready to not need it. Having a higher credit score provides for benefit in the long run and when you need it rather than a credit card that you do not have a require.