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Survey: When Denied a Credit Card, a Third Point to Low Credit Scores | Credit Cards


Survey Findings:

  • All respondents had been denied for a credit card. Among those who knew their credit score, over 46% had a score between 580 and 669, which is a fair score. And more than 25% had a score between 300 and 579, which is considered a poor credit score.
  • About 44% say they read the adverse action notice that the card issuer sent to them, which states why the application was denied.
  • Nearly 42% had applied for a credit card to help them build credit. 
  • More than one in four, 27.8%, say their credit had been damaged by a parent who had done something such as putting a credit card or a bill in a child’s name. 

Survey: When Denied a Credit Card, a Third Point to Low Credit Scores | Credit Cards

In late May, U.S. News & World Report conducted a survey that focused on individuals who had been rejected for a credit card. Survey respondents were asked why their application was rejected, and here are their responses:

  • Credit score too low: 31.2%.
  • Not enough credit history: 17%.
  • Using too much credit: 11.2%.
  • Too much debt compared with income: 10.5%.
  • Don’t know why: 7.7%.
  • Too many late payments: 7.5%.
  • At least one account in default: 7.2%.
  • Too many recent credit card applications: 6.4%.


It’s not surprising that low credit scores were an issue. Among those who knew their score, over 46% had a score between 580 and 669, which is a fair score. And more than 25% had a score between 300 and 579, which is considered a poor credit score.

What Steps Did You Take After Your Application Was Denied? 

Survey respondents were asked what, if any, steps they took after their credit card application was denied. Here are the findings:

  • Did nothing: 53%.
  • Called the reconsideration line: 13.2%.
  • Applied for a different credit card: 32.5%.
  • Other: 1.2%.

A majority didn’t take any steps after the rejection, which is unfortunate. There are steps you can take to put yourself in a better position the next time you apply for a credit card.

Why Were You Applying for a Credit Card?

Respondents say they applied for a credit card for the following reasons:

  • Start building credit: 41.6%.
  • Earn rewards: 18.8%.
  • Consolidate debt: 15.8%.
  • Had a large purchase to make: 13.1%.
  • Want a high-status credit card: 9.57%.
  • Other: 1.3%.

It’s ironic that, among respondents, the most common reason for trying to get a credit card is to build credit. If there’s a silver lining with a denial, it’s that you get solid feedback about why you were turned down. If you focus on the reasons and actively try to improve your credit, you’ll eventually see good results.

How to Get Approved On Your Next Credit Card Application

No one likes to be rejected. I know it’s hard not to take it personally, but it really is just a business decision based on your application and not a character judgment.

The best way to feel better? Take action! Keep in mind that you might need to focus on more than one thing to get your credit in shape. The best actions to take will vary depending on your specific circumstances.

Here are the steps that respondents took before applying for a card again:

  • Improved my score before applying again: 26.5%.
  • Applied for a credit card with a lower credit score requirement: 25%.
  • Applied for a secured credit card: 20.6%.
  • Reviewed the adverse action notice: 19.4%.
  • Other: 8.6%.

Improve Your Credit Score

There are several things you can do to boost your credit score. If you already have a credit card, ask for a credit limit increase. You have a credit utilization ratio, which is the amount of credit you’ve used compared with the amount you have available.

Your ratio should be less than 30%. An increase in your limit gives you more available credit, so that lowers your ratio. For a big boost, keep your ratio under 10%.

If you don’t have a credit card, just pay all of your bills on time and consider getting a credit-building loan from a credit union or local bank. Do this for six months and you should see improvement.

Now, one of the biggest mistakes people make is applying for a card that requires a higher score than what you currently have. If you focus on credit cards that target individuals in your credit score range, your odds of approval increase a lot.

Apply for the Right Credit Card 

Start researching credit cards and note what score the issuer is looking for. If you know you have fair credit, target cards that are designed for the fair credit demographic. Most websites allow you to search for cards by credit score range.

Secured credit cards are another option, and many have rewards and limited fees. Having to put down a deposit for the card isn’t ideal, but if it helps you build credit, it’s worth it.

Basically, don’t waste time on cards you can’t qualify for. For instance, you’ll need very good credit to get approved for some of the elite travel rewards cards. That doesn’t mean you won’t eventually qualify for a great card. You just have to be patient and practice good credit habits. You’ll eventually get there!

Review the Adverse Action Notice

The survey respondents were asked how they knew their application had been denied. About 44% say they read the adverse action notice that the card issuer sent to them, which is terrific. Note this information can also be sent via email or a phone call.

The adverse action notice is loaded with valuable insight. It will tell you why you were rejected and offer steps to correct that. You’ll also be told which credit bureau and credit score were used. Think of this notice as a blueprint for improving your credit.

How to Ask for a Reconsideration

If you believe that you should have been approved or that you’d like to explain a situation, you can call the issuer’s reconsideration line.

Before you call, prepare a list of points you want to make. Approach the call calmly and state your case. Even if you still don’t get the credit card, you’ll likely come away from the call with more information about how to improve your credit.

Does Getting Denied for a Card Hurt Your Credit Score?

Being denied for a credit card doesn’t hurt your credit score, so you can stop worrying about that. However, each time you apply for a credit card, you could lose up to five points off your score.

That’s why it’s important to apply for credit cards that are within your credit range. Some issuers will allow you to ask for preapproval for a specific card. If you’re preapproved, it doesn’t mean you’re officially approved. You still must apply for the card. But taking this step can keep you from applying for a card that you’re unlikely to get approved for. And that protects your score.

Sarah Goldberg
Sarah Goldberg

Sarah is a seasoned financial market expert with a decade of experience. She's known for her analytical skills, attention to detail, and ability to communicate complex financial concepts. She holds a Bachelor's degree in Finance, is a licensed financial advisor, and enjoys reading and traveling in her free time.

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