Applying for a credit card can be nerve racking, especially if your credit is less than perfect. As we head into holiday shopping season, how do you pick the card that is right for you?
First, let's take a look at the implications of applying for a credit card you aren't qualified for. A credit card issuer (or bank) will run a hard credit pull in order to access your credit and make a decision on your card application based on the information in your credit profile. If they don't like what they see, you'll be declined for the card you applied for. This will add an inquiry to your credit report, which will lower your score between 3-10 points for 6-12 months for most people. They'll fall off of your report completely after 2 years. It also lets any other banks know that you're looking for credit. A number of inquiries will make you look desperate for credit.
Luckily, there are a number of tools out on the market to help you find cards you are more likely to qualify for without taking a shot in the dark. These tools will allow banks to take a look at your credit profile using a soft credit inquiry. You'll need to provide some basic info: name, address, and last 4 of your social security number. This won't impact your credit score. Just remember a match isn't a guaranteed approval, it's just an indicator of being more likely to be approved. You'll need to complete an application after this step.
First up is. This tool will match you to pre-qualified offers from Capital One, as well as match you to relevant offers from Chase, Bank of America, American Express, and First Premier Bank. The tool will use one soft inquiry to match you to all of these banks which is pretty convenient. Just remember to use the filter option on the left side of the page to make sure you review all of the offers presented. You'll be auto-filtered to pre-qualified offers from Capital One or Special Offers from American Express, if you are matched to offers from either of those banks.
As we mentioned, sometimes issuers like American Express will plug special offers into the tool, so it's worth checking to see what you match with!
If you know you have bad to fair credit, and you don't want a secured credit card, we'd recommend starting with Credit One Bank. They are big lenders in the bad-fair credit space, and they run a pre-qualify check on all applicants before they apply. Their cards come with some rewards earning opportunities, but their interest rates and annual fees can be a bit high. If you're having trouble picking the right credit card, here's a breakdown of what goes into a credit score, and the different kinds of cards available.
If you're looking for other options, you can try the individual bank sites below to see their pre-qual options as well. Each bank will run their own soft credit inquiry, but again, these don't impact your credit.
Looking for credit can be a daunting task. Use these tools to help get matched to the offer that is right for your credit profile. Then you can move on to something that is more exciting than picking out a credit card. Like how to optimize your rewards as part of your budgeting strategy!