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Was your credit card application rejected? This could be the reason

In the event that your card application has not been approved, you must consider the reasons for the rejection before requesting it again.

7 min read

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Was your credit card application rejected? This could be the reason
Was your credit card application rejected? This could be the reason

In our country, 24,382,136 credit cards were circulating at the end of 2019 according to Banxico data. However, according to analysts, less than half of the people who apply to one of these financial products compare with other options before and take the card that they offer or they approve.

‚ÄúThere are many reasons for a credit card application to be rejected. Banks look for the ideal candidates for each financial product, this includes that they meet certain requirements, are reliable, and are in a position to keep their payments current. When a bank declines a credit card application, it not only denies you access to their product, but could also reduce your chances of obtaining another in a later attempt, “explains Luis Madrigal, director of Coru.com

In order to warn credit card applicants about measures that could void their application, the financial services platform Coru.com issues the following recommendations to keep in mind to be prepared and demonstrate that you are a suitable candidate.

In the event that your card application has not been approved, you must consider the reasons for the rejection before requesting it again.

Frequent reasons for rejection:

Before applying for a card, you have to make sure you know not only the general requirements, but also the plastic that we are specifically interested in. One of the first filters to approve a credit card is income. Each bank establishes a monthly minimum and the methods to confirm that you have it, usually through payroll receipts or savings account statements or checks.

It is best to select a card that is consistent with your income and helps you with recurring payments. All credit cards are processed through an application (application filling). Before completing it, analyze what you need. If you order a product that does not adapt to your possibilities, you will receive a rejection from the bank.

Credit history is a very important aspect for any financial institution to decide whether or not to grant a line of credit. To prevent your application from being rejected, it is important to have your credit history in order, if you have it, or to start it if you have never had one. The credit history in Mexico is registered with the Credit Bureau , a private institution dedicated to collecting information from credit users in the country.

Other reasons to deny credit card application

1. Never have taken a credit. For most credit cards, an investigation is conducted to find out the applicant's credit history; but if you have not had any credit there is no way to have references. In this case, a possible solution is to start building credit history with a guaranteed card, an online loan or some rental plan for telephony, which generates recurring payments, provided they are met on time.

2. Bad credit references. This happens when some history in your credit history indicates that you are an unreliable user, perhaps due to non-payment, withdrawal or some credit that was not paid in a timely manner. If you think it may be your case, request a special credit report from the Credit Bureau, you are entitled to one free of charge each year, and then you can consult it as many times as required for a cost of 35.60 pesos.

If you had a problem with other credits such as arrears or non-payment, the best thing to do is to get current, and allow a few months to request the card again.

3. Failure to demonstrate ability to pay. Along with knowing the credit history, the bank ensures that the applicant is able to keep a credit card at the time they request it. It is essential to demonstrate that the income necessary to pay for the card is received, and that they do not commit to other financial products that may prevent payment of the card. If the bank detects that you do not have the possibility to pay constantly, it will reject your request.

4. Insufficient income. Similar to the previous point and according to the requested plastic, it is not enough to have demonstrable monthly income, but to have a minimum required, or to have a savings account where the perceptions of each month are recorded. In this case, the same bank that manages your savings account could offer you a credit card after a time of building trust.

5. Have a lot of credit cards. It is a cause to deny a credit. Even if you keep them in order and up to date, the financial institution can consider this as a potential risk of indebtedness. The recommendation is to have the cards that you can pay without spending more than 30% of your salary on debt and avoid long-term purchases. The more credits you have assets at the same time, the greater the risk of indebtedness.

6. Have very high credit assets. For example, mortgage or automotive, which is usually for very high amounts and long payment terms. Having this type of loan and applying for a new credit without showing additional income could be an imminent risk of indebtedness with the plastic. The best thing is to continue making punctual payments of the first credit, so that when applying for the card, the amount due on your mortgage or self-financing is 50% or less, and increases the possibility of having the new credit.

7. Make many card requests simultaneously. Asking for credit cards at many banks at the same time may not be a good sign for banks. Before filling out any application, confirm that it is the right card for your lifestyle and do not repeat the process in different banks at the same time. If it is rejected, wait a few months before the next attempt.

8. Give correct information. A very important aspect for the bank is that the information in the application is real. If due to fraud or carelessness a date or data is badly filled and cannot be verified, the bank will not know if it was an error, it only detects that the information is false and is a bad sign to grant a credit. Avoid exaggerating figures such as income and check that the data matches your current official identification.

Recommendations to reapply for a credit card

  • If the reason for rejection was the credit history, it is best to put it in order and wait at least two months to see it reflected in your report. If the reason was that you do not have a credit history, first request an immediate loan or a phone plan and in six months reapply for the credit.

  • If you want more than one credit card, evaluate if you really need them. Once you order a card, wait at least 45 days to request a second and 90 for a third.

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