Does getting denied for a credit card affect your credit score?

Quick insights

• Getting denied for a credit card does not affect your credit score outside of lenders running a hard credit check, which is an inquiry into your credit report that takes place each time you apply for a new line of credit, regardless of whether or not you are approved.
• You can still be denied credit even with a good credit score.
• It can be beneficial to continue to manage and use your credit wisely.

Have you been eyeing a credit card you like but aren’t sure you can get approved for it? You may want to take a closer look at your credit score and financial habits to potentially help improve your chances for approval. In this article, we’ll review the impact of approval decisions on your credit score.

Understanding the impact of approval decisions on your score

When you apply for a credit card, lenders run a hard credit check. This allows your potential lender to review your credit report and assess the various factors that contribute to your creditworthiness and level of risk. This process temporarily hurts your credit score, regardless of if you are approved or denied for a credit card. You may see your credit score decrease by a few points as a result of a hard credit check.

Being aware of this hard credit check and its impact on your score can help you decide when to apply for your next credit card. Additionally, applying for several credit cards in a short period of time could hurt your credit score.

Does your credit score decrease when you’ve been denied a credit card?

If you recently applied for a credit card and were denied, you may feel disappointed—however, you can remain diligent and continue to pursue a higher credit score or find a card better suited to you. While a hard credit check can temporarily hurt your score as mentioned above, the denial itself won’t necessarily hurt your credit score.

It is usually a good idea to remain patient and manage your credit wisely. Building healthy financial habits may help you with future applications.

Does denied credit show up on your credit report?

Another reason why a denial for a credit card generally won’t hurt your score is because the decision will not appear on your credit report. Your report instead shows your current credit card activity as well as other active accounts and accounts that were closed in the last 10 or so years, such as mortgages or loans.

Instead of a denial showing up on your credit report, you may see a hard credit check reflected on your report for when you applied for that card. Remember, this action can temporarily lower your credit score.

Can you still be denied a credit card even if you have a good score?

It’s still possible to be denied for a card even if you have a good credit score, since lenders also consider other factors such as debt-to-income ratio, number of recent hard credit checks and your employment history.

While a good credit score may help you get approved for credit cards, there are some that are more restrictive in their requirements.

Whichever credit card you decide to apply for, consider reviewing the terms prior to applying. This proactive action can help you stay informed when it comes to finding a card that suits your lifestyle and spending habits.

What to do if you keep getting denied credit?

If you’ve been continually getting denied for credit, you may want to make some changes first. Implementing consistent, healthy financial habits can be a helpful way to get started on improving your creditworthiness and your approval odds.

Some ways you can help improve your credit score prior to applying include, but are not limited to, the following:

• Consider enrolling in Chase Credit Journey^®. This free online tool is available to everyone, including non-Chase customers. You can use this tool to view your credit score without impact, as well as see your free credit report, provided by Experian™. It also offers free identity monitoring and access to several educational resources and tips for ways you can help improve your credit score over time.
• Review your credit report for errors or inaccuracies. If you find something incorrect, be sure to report it to the respective credit bureaus so they can fix your credit report. This can help ensure your credit score is up to date and potentially help raise it.
• Lower credit utilization ratio. This is the amount of credit you use against your total available credit. Lowering this ratio to about 30% or less can help improve your credit score.

You may also want to consider a lender’s pre-approved offer. Lenders make these offers after running a soft credit check which does not hurt your score. Note that even if you are pre-approved, you will still need to have a hard credit check run as a part of your official application if you decide to apply for the card. Additionally, a pre-approval does not guarantee that you will be approved for the card, but it gives you an idea of what your chances are.

Additional considerations for credit card applicants

As you start applying for credit cards, you may want to keep in mind some of the following information:

• Review the card’s terms and conditions before applying. You don’t want to be surprised by a high annual fee or other charges you weren’t aware of.
• Build a positive credit history with your credit cards. Once you’re approved for a card, try to use it responsibly. You can continue to improve your credit score and you may unlock more doors for yourself if you practice healthy financial habits, such as paying your balances on time.

Conclusion

Getting denied for a credit card doesn’t inherently mean you are “bad” at credit or won’t have the opportunity to get approved in the future. Additionally, a credit card denial doesn’t hurt your credit score. It can be helpful to look for ways to help improve your credit score and credit profile prior to applying so that you can help increase your chances for approval. Also, look for cards that suit your spending habits now. If you only qualify for a card with low credit limits or few rewards, that's okay! Over time, you can build up a positive credit history, which may help you eventually get access to more options in the future.