- A high credit score: Card issuers strongly prefer scores of 700 and above (on the FICO scale of 300 to 850). The best terms are reserved for people scoring 750 or higher (compared with 720 a year ago). If your score is lower than 650, you’ll likely be rejected.
- Low usage of existing cards: Lenders like to see that you’re using less than 30 percent of your credit limit.
- A long, happy credit history: The longer you’ve repaid credit on time to the same issuer, the better your chances of approval. It helps, too, if you have a clean history of paying mortgages and other credit cards.
“These days, you should not expect to get a $20,000 credit line right off the bat. It will be more typical to get $2,000 to $8,000,” says Gerri Detweiler, a credit-card expert at Credit.com.
Say goodbye to those 3.99 percent teaser offers and zero percent balance transfers.
Here’s a guide to today’s market for credit cards:
Credit Availability
Low
What It Takes to Get Approved
What You’ll Pay
As low as 7.25 percent for scores of 750 and up; 14.99 percent to 21.99 percent for scores of 650 to 699.
Advice
If your FICO score is below 580 and you still want plastic, your only option may be applying for a secured credit card. To get one, you’ll need to put down a cash collateral deposit; that then becomes the card’s credit line. Lenders like Wells Fargo and specialty banks such as Applied Bank and New Millennium will take a deposit of, say, $300 and charge 9.9 percent or so with no grace period. Pay on time for a year and you may then be able to get a real credit card.
If you have only one credit card, secure a backup before the new rules go into effect in February 2010 — in case your card company changes its terms on you.
You used to be able to play the tough customer to get your current card’s annual fee removed, credit limit raised, or interest rate lowered. Not anymore. Those demands just might trigger a review of your account. “Card companies are not trying to keep customers, they are trying to weed people out,” says Detweiler.
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