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Eligibility Requirements for Unsecured Credit Cards
What are the eligibility requirements for unsecured credit cards?
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Eligibility requirements for unsecured credit cards can differ from one issuer to another. However, there are some factors that most credit card companies have in common. An overview of such ‘common’ eligibility criteria can be provided as follows:
Age:
Applicants must be of majority age and above (18 or 21, depending on location. min).
Credit Score: Generally, an unsecured card is available to applicants for a credit score of 600 or above. Generally, higher than 700 scores will benefit cardholders from rewarding and better cards. Unsecured cards are targeted at fair credit holders and cover scores of 640 and higher.
Income: Stable and verifiable income must be shown. A minimum monthly income is required. Income varies depending on the card issuer and the type of card applied. Debt to Income Ratio (DTI): Preferred ratios should be lower, with the majority being 40-50% and lower.
Employment Status: Either steady employment or a dependable source of income is mostly a requirement. Citizenship/ Residency: Most cards require housing, US citizenship, or permanent residency. A few may be offered to non-resident aliens with an SSN or ITIN.
Credit History: Which considers the age and structure of the credit history? Absence of recent bankruptcies, defaults, or any serious delinquencies.
Previous Relationship with Issuer: A few issuers prefer applicants with accounts with them.
Address Stability: The requirement for a permanent residential address may appear on some application forms.
Educational Background: Some student credit cards might require verification of enrollment in higher education.
Financial Responsibility:
There has been no misuse in terms of abuse of credit cards and or fraud. Timely payments in the past 24 months are a must.
Existing Credit Limits and Accounts:
The number and type of existing credit accounts can also be the qualifications.
Recent Credit Applications:
A lot of applying for credit can make it hard to get approval.
Specific Card Requirements:
High-end credit cards can sometimes include additional requirements, such as premium income or even the best credit accounts.
Relevantly, the applicant should remember that the fact that state requirements have been satisfied doesn’t guarantee he will be granted a credit card. Every issuer has its own rules related to underwriting. Some, but not all, issuers provide a pre-qualification function to check the potential for getting a credit card without having hard credit checks done.
For those with limited or poor credit history, an affordable credit builder card or student credit card (if applicable) may be offered. These cards can assist in establishing credit and pave the way for applying for an unsecured credit card.
Every cardholder needs to observe the following steps before proceeding with an application:
Ensure that the information used to generate a credit score is correct, especially if a firm advises or assists in improving a client’s creditworthiness.
Identify certain cards that are suited to your credit background.
Pre-qualification helps when there is an opportunity to do so.
Remember to decrease the number of applications because of the consequences of several hard pulls on your report.
Lastly, always remember that prudent credit card management is vital to building and maintaining one’s credit health.