Applying for a credit card in the United States can sometimes be a daunting challenge. Getting a new credit card always revolves around you being approved by a bank or credit card issuer. And even though these requirements can vary between these providers, many of them are the same, regardless of which bank or credit card provider you choose.
It’s important to keep in mind that the US is mostly a cashless society. In comparison to many other parts of the world, cash and debit cards are the predominant way of paying for things. What this means is that a credit card in the US will be more convenient and it also essential for establishing a line of credit and a credit score. These, in turn, help you with other things such as getting a loan, a mobile phone subscription, or a mortgage, among other things.
Below, we’ll be talking about what is the primary process of applying for a credit card in the United States.
What Are the Basic Eligibility Requirements?
Like we said, credit card eligibility criteria vary based on the type of credit card you are applying for, as well as the provider you are looking to work with. Nevertheless, there are some basic requirements that almost everyone is asking for. These include the following:
- Your Age – In most cases, you need to be 21 years old to apply for a credit card in the United States. There is also the possibility to apply if you are 18 and have a parent’s permission or a valid source of income.
- Your Residency – Most providers require you to be a permanent resident of the US. However, there are certain types of credit cards for temporary residents with valid visas.
- Your Income – Your income will also play a role in getting approved. Salary is a more important factor since the last economic crisis and the subsequent CARD Act of 2009.
- Your Credit History – Last but not least is your credit history and by extension, your credit score. As a general rule of thumb, you need to have a good credit history if you are to get approved for most credit cards.
Information Requirements for Credit Card Applications
Most credit card applications will request information based on three main categories. These include personal, employment and income, and financial information.
Personal information – As part of your personal information, you will need to provide the following:
- Your full name and date of birth
- Your citizenship – whether you are a citizen, permanent resident, etc.
- Social Security Number – Another major requirement that banks and credit card providers request is a Social Security Number (SSN). SSNs are assigned to US citizens, permanent residents, temporary residents who are authorized to work in the country. SSNs are used to report your wages to the government as well as to determine the eligibility of Social Security benefits. To get a credit card, people must first have an SSN. Those that do not have one will first apply for a Social Security Card by filling out the SS-5 Form and provide the necessary documentation required. You can also supply an Individual Taxpayer Identification Number (ITIN), as some credit card providers may only need it, instead of an SSN. You can apply for one at the IRS.
- Residence – It includes your current home address as well as the time you’ve been there. In some cases, you may also be asked about previous addresses.
- Contact Information – Phone number, email address, etc.
All of this information will also be required for an additional applicant if you are looking to create a joint credit card account.
Income and Employment Information – The credit card merchant will verify for steady income. They will usually ask you for:
- Your Occupation – It includes your position, company, as well as whether you are working a full or part-time job.
- Your Income – Annual income before taxes and any secondary income such as benefits – child support, etc.
- Your Employer – Most providers will also ask about your work history. They require the company name and contact info. In some cases, you may also be asked to list previous employment details. If you are self-employed, you may need to provide your prior tax returns.
Financial Information – This section of information will identify if you are eligible for a card and determines the credit limit:
- Your Account Details – Provide all bank accounts, savings, and current balances.
- Your Assets – Include savings, investments, and properties.
- Your Housing Payments – Provide the monthly mortgage or rent payments.
- Your Credit and Other Debts – You will also have to disclose any other credit accounts, debts, personal loans, car payments, etc.
Deciding on the Right Credit Card
Choosing the right credit card that best fits your needs is critical. If you are a first-time applicant, the best way to go is with a card that has low or no annual fees, as well as a low-interest rate. Retail credit cards – those issued by Costco, Target, and other retailers – are an excellent place to start, as issuers are more flexible with qualification standards.
Secured credit cards are also a good starting option. They require a cash deposit and are generally for those with no credit history and are looking to build a credit history. These cards, however, may include high-interest rates and various fees.
Standard credit cards, on the other hand, or unsecured, meaning that you don’t have to put down a deposit to secure the card. Business credit cards are also an option, particularly for small business owners since they can provide certain bonuses.
Additional Documentation for a Credit Card Approval
Depending on which type of credit card you are applying for, there may be some further requirements and other documentation that you need to provide. Some supporting documentation may sometimes be required to confirm the statements mentioned above. These can include things like photo IDs, paystubs, tax documents, etc.
When submitting documents, you might be able to upload them online, or you can bring them in. Credit card applications submitted online usually provide decisions within minutes. The lender will inform you if additional documents are required before receiving your card.
Another issue to keep in mind is hard inquiries. Every time a provider performs a credit check a few points of your credit score are deducted. To ensure that your score remains high, keep queries to a minimum. We hope that this information was helpful in the often complicated process of applying for a credit card in the United States. For more information, please feel free to visit our website!