How Often Can You Apply for a Credit Card (Safely)?


hey I'm Adam Jusko from ProudMoneycom and in this video I'm talking about how often you should apply for credit cards or how often can you apply for credit cards safely

And so the answer to how often is OK to apply for credit cards is: it depends If your credit is very good, it's not a big deal to get credit cards sort of on a regular basis if you want to If your credit cards not as or if your credit score, your credit history, is not as good, then you should not be applying for credit cards as often

Every time you apply for a credit card, you are taking a small hit to your credit score There is what is called a "hard pull", which basically means they are pulling your credit report and checking your credit score, and every time you do that, that actually becomes part of your credit report and sort of part of your credit score Because every time you apply for new credit that is part of the calculation of your credit score So if you want to apply for new credit cards, if you have excellent credit and you have plenty of other credit cards, maybe you've got a mortgage, car loans, or whatever and you've always paid your bills on time, then you really don't need to worry about how often you can apply for a credit card You're really not going to get dinged that hard and the hit to your credit score is temporary, especially if you continue to pay all your bills on time

it's essentially going to get wiped out and you don't even really need to worry about it If you're someone that doesn't have as good of credit, or if you're someone who's trying to build credit maybe you have a limited credit history I would say you really should not apply for a new credit card more than once every six months

If you have a bad credit history in particular, you really probably should not be applying for a card more than once a year In either of those cases, you are trying to build a history and show potential lenders that you are trustworthy with your credit card and that you can handle a credit card So if you have a credit card and you keep applying for more credit cards, well then it looks like you're a little credit hungry and you haven't even established a history of showing that you can handle the credit cards that you already have — and obviously that's going to be a turn-off to the banks and it's gonna make you look fairly risky Now if you do have good credit, even though I say you really shouldn't worry too much about how often you apply for a credit card, there is still something to consider If you're one of those people who is applying or even asking this question because of the fact that you are sort of, you know, chasing signup bonuses or the the best rewards on certain cards, you don't want to keep opening new cards over and over again unless you are sort of maximizing what you are getting out of each new card So, you know, if you keep opening credit cards, that's gonna show up on your credit report But if you keep opening new credit cards and you barely use them or if you use them for three months and then you never touch them again, sooner or later that's gonna kind of put a red flag up at the banks and maybe the next time you go to apply for a card — and maybe it suddenly has this amazing bonus that you really really want — you may find that your history of going after lesser cards and applying so often could actually hurt you You might get rejected

Even though your credit score is fine, your history and your behavior could still ding you In particular, one example I'll use is Chase has what is called the 5/24 rule, which means you can't get more than five Chase credit cards within a 24 month period So let's say you were someone who's just applying like crazy because you want to try and hit all these bonuses and, you know, it's not gonna hurt your credit score Still, if you have applied too often, then all of a sudden a new card comes on the market or a card that existed suddenly has a short-term huge bonus opportunity — if you've broken the 5/24 rule with Chase, they're not going to let you have any new credit cards So that's something to consider

A lot of the credit card approval process, especially for those with excellent credit, is automated so there's not really any person that is looking at your credit score or determining these things So for the most part you can sort of get away with applying for new cards and even if you don't really use them very much you get the bonus and then just put them in the drawer — there's not a huge penalty for doing so But, nevertheless, there may be certain catches in place that say "this person has applied X number of times" and then it may be, you know, given to an actual human to look at and then making a manual approval versus just getting that automated approval based on whatever criteria that they use to apply The other thing to think about, for anyone, regardless of your credit score, is what else you have coming up in terms of when you may need credit approval In particular, if you are going to be applying for a mortgage any time in the near future, even if you have excellent credit, you really don't want to be opening a new credit card within, say, three to six months of that mortgage approval

It's best for you to be maximizing that credit score as you get closer to that mortgage approval time, because obviously the better your credit score, the better rates you're gonna get on your mortgage And a better rate on your mortgage is just gonna blow away any bonus that you get from any credit card So, you know, try to control yourself within that the three to six month period before you are going for a mortgage even auto loans to some extent, I would offer the same advice about And obviously if your credit is not as good, you might want to back those numbers out even further, so you do not have new credit applications on your credit report when you're going after a mortgage or some other large purchase So, that is it! Thanks for watching Please go to ProudMoneycom for personal finance articles, "best of" lists, and all sorts of other good stuff, too

Thanks for watching Bye

Source: Youtube


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