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It is a story that happens often. A person applies for credit so they can make a special purchase. Thanks to computer technology, the application is processed immediately. The problem is that not everyone is approved for the credit they apply for. You may think that you have excellent credit and will not understand how you could be denied. The reasons for denial can be surprising at times and you may not have realized that your credit was not as perfect as you thought. The first thing you have to realize is that many credit decisions are processed by computers. They look at specific factors on your credit report and are able to come up with the decision automatically. There are many factors that go into the decision for credit including your credit score, the amount of debt you have, the length of your credit history and other things. If you are denied credit, you can get a copy of the credit report that was used for the decision. Get that copy so you can start to understand how the decision was made. Your credit score The number one factor in the decision is your credit score. Not everyone knows what their score is and not everyone is aware of what it a bad credit score. In general a score of below 680 is considered to be bad credit. A score of over 760 is considered to be excellent credit. The factors that go into your score include your payment history, the amount of open accounts, the length of the history and the amount of new credit that has been established. When you get your credit report, look at the history of your accounts. If someone has stolen your identity they may have opened up credit accounts in your name. When you learn about how to prevent identity theft, you will hear about monitoring your credit report for this type of problem. You can have fraudulent accounts removed and it will instantly improve your credit score. You might also see other mistakes or accounts that you thought were closed on your credit report. All of these things can be disputed and corrected if you follow the right procedures. Inaccurate information The next most common reason for people to get denied is information on the credit application does not match the information on the credit report. If you have recently moved, the address may not have been updated with the credit bureau. You will be denied credit because the credit card companies are worried about potential fraud. Just like when you get bad credit help for your credit score, this information is easy to check and correct when you look at your credit report. Existing relationships Most people do not realize that credit card companies offer a wide variety of products. It is possible that the card you just got denied for is from the same credit card company that you already have an account with. You are not being denied because of bad credit when this happens. The reason that you are being denied is that the credit card company has already given you all the credit that you qualify for. The credit limit you are given on a card is based on the credit history and income and how much risk the company will take. The best way to deal with this issue is to adjust the limit on the card you have. You will still have the same limit, but you will split it between two cards. If you are denied credit for any reason, do not panic. Get your credit report or you can call the credit company and ask for an explanation. If it is because of a problem with your credit score, you can find out what to do if you have bad credit and still want to get their card. They may have options that will not only help you get the credit that you want, but also fix the problems you have on your credit report. There is never any harm in asking. Jana Lynn is an active blogger who is fond of writing articles on Bad Credit Loans to encourage people to manage and protect their credit. Follow her on Twitter to know more on tips to get you credit card application approved.
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