Credit card rejection can come as a nasty surprise - you thought your credit rating was fine, the application form was filled out properly, so why has the company turned you down? The sense of rejection, especially from companies that practically guaranteed approval, can leave a bitter taste in the mouth. But there is hope. Just because you've been turned down doesn't necessarily mean you have a poor credit rating; it could be a simple mistake such as an error on your report or a mistake regarding your address. And mistakes can be easily rectified. Lenders are legally required to send rejected applicants a letter explaining the reasons for turning down a credit card application. Sometimes these letters can be vague, only covering the bare minimum requirements. So the first thing to do is follow it up and make sure that the company has denied your request for legitimate reasons. Although rare, mistakes can and do happen. The lender is also legally required to send you documentation stating which credit agency they used to obtain your credit history (although some lenders now use all three of the primary agencies). If your cross-referencing throws up obvious mistakes, you can contact the agency involved and have the mistake corrected. That simple error could be affecting your finances far more than you think. A credit report request incurs a small charge, but it gives you that all-powerful weapon - information. The credit agency will give you all the details they hold on you and are perfectly willing to made amendments if you come across an inaccuracy. Contrary to popular belief, there is no 'black list': credit agencies do their very best to make sure that information held is accurate and relevant, but no system is perfect. Once you have got the agency to correct your details, you could then appeal against the initial rejection by the credit card company; however, these cases rarely succeed. A better plan may be to wait a short while for the information to filter down, and then reapply. Credit ratings or 'scores' as they are commonly mislabelled, are mysterious tomes, usually the preserve of banks and 'the System'. However, every consumer has the right to access their records from any of the credit agencies holding details on their financial activities. Your credit rating is affected by your previous financial history over a number of years, including loans, repayments and how you have run your financial affairs. 'Black data' (details of late payments, defaults, CCJs or other failings in your credit track record) is shared between financial lenders and can impact on your eligibility for future credit. Increasingly, 'White data' is also being exchanged as well. White data tells lenders about your financial management skills and how attractive a borrower you may be. Surprisingly, it doesn't always work in your favour. Someone who always clears their monthly credit card balance isn't going to incur any interest charges and as such is not as attractive a proposition to lenders, who depend on those interest charges to make a profit. Credit card application denial can be the result of a range of issues, from the simple to the complex. Something as basic as forgetting to send off your electoral registration can mean that your credit rating drops - the credit card company simply doesn't have any proof of your address. Mistakes like this can be rectified easily, improving your chances of being accepted next time you apply for a credit card. If you are turned down repeatedly by several companies it may indicate a bigger problem with your credit history. This isn't the time to bury your head in the sand and hope it'll get better on its own. You can take positive steps to rectify the situation. By making sure you pay your bills on time, pay off debt rather than shifting it around and managing your score, you can stay in charge of your credit rating. Before reapplying for credit cards, giving yourself a 90-day period to get your house in order can raise your chances of being accepted the second time around. Get your bills paid, catch up with any arrears and show the credit card companies that you're a good investment. Avoid multiple applications - they can do your credit rating more harm by having a cluster of rejections on your record. A pragmatic approach to financial management and a little patience are the best ways to turn you into an attractive proposition for credit card companies.
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