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You may discover that it makes sense to apply for several credit cards when you are comparing credit products. Perhaps you’re considering joining the Chase network to benefit from the synergies that come with owning both a Chase Sapphire Preferred® card and a Chase Freedom Unlimited® card. Or maybe you are starting to travel for work and are thinking about getting a credit card co-branded with a hotel, a credit card from an airline, and a premium travel card that gives you access to lounges.
We’ve compiled the information you should know before sending out multiple applications for credit cards. In every situation, is applying for multiple cards at the same time a good idea? Are there advantages to doing this? How will it affect your credit score?
How Multiple Credit Card Inquiries Affect Your Credit Score
It can be alluring to apply for multiple credit cards in a short amount of time, whether your goal is to improve your credit quickly or to take advantage of different perks or welcome offers. However, depending on your circumstances, it might be detrimental to your credit score.
It’s customary to obtain quotes from several lenders when looking around for a mortgage, auto loan, or even a private student loan to make sure you’re getting the best terms. Additionally, if you complete this within a short window of time—usually between 14 and 45 days, depending on the credit scoring model—all hard inquiries that appear on your credit reports will be combined into a single credit score calculation.
With credit cards, however, you wont get that same benefit. Generally speaking, when you apply for a credit card, you will get a separate inquiry for each, and that inquiry will go into your credit score.
Depending on the credit scoring model, those inquiries may have an impact on your credit scores. For instance, one more inquiry will typically result in a credit score drop of less than five points when using the FICO® ScoreTM. But making several inquiries in a short amount of time could have a compounding effect.
Furthermore, information indicates that individuals who have multiple inquiries on their credit reports in a brief amount of time are more likely to overextend themselves and fall behind on their payments. Because of the increased risk, future creditors may offer you higher interest rates or reject your application completely, even if your credit score doesn’t significantly decline.
How Long Should You Wait Between Card Applications?
The amount of time you should wait before applying for another credit card is not a fixed number. Actually, depending on your circumstances and credit history, the appropriate amount may change:
You Have a Limited Credit History
A second credit card can help you establish a better payment history and increase your credit utilization ratio, which measures how much of your available credit you are using, if you are just beginning to build credit. These advantages might offset any possible drawbacks from a second hard inquiry. Nevertheless, you should think about waiting three to six months between applications if you want to be safe.
Just be sure that the credit cards you’re applying for are starter cards meant for individuals with your credit situation. If not, you can be turned down and your credit report would still be subject to a fresh hard inquiry.
You’re Rebuilding Your Credit
Every effort matters if your credit is bad and you want to use credit cards to improve it. It might be wiser in this situation to wait a few months between card applications. Additionally, if you are behind on payments on another credit account, opening new credit card accounts might not help much. Instead, focus on other areas to improve your credit, like debt repayment to help reduce your utilization ratio. You may want to apply for a new card after you’ve had an opportunity to improve your credit.
You’ve Been Denied Recently
Whether or not you are granted a card, hard inquiries made during the application process will negatively impact your credit score. Before applying for another one, take a step back if you’ve recently been denied. Before reapplying, assess your credit status to see if any adjustments are necessary.
Additionally, confirm that the cards you are applying for are specific to your credit score. With just a soft inquiry—which has no impact on your credit scores—Experian CreditMatchTM can assist you in receiving customized offers based on your credit score. Even though there’s no assurance you’ll be accepted, concentrating on cards with better approval chances can help
Your Credit History Is Well-Established
Two or three credit inquiries in a short period of time probably won’t have as much of an impact if you’ve been using credit for a long time and have a great record.
Furthermore, if you are paying your bills in full each month and spending no more than you can afford on your current credit cards, you might find that the advantages of obtaining a new card exceed the disadvantages.
You can check your FICO® Score to see where you stand if you plan to apply for more than one credit card in the near future. Think about the advantages and disadvantages of having several inquiries on your credit reports in the near future as you assess your circumstances.
Apply for credit cards with assurance and receive tailored offers according to your credit history. Get started with your FICO® Score for free.
FAQ
Is it OK to apply for multiple credit cards in one day?
No, it’s not illegal to apply for more than one credit card in a single day. But doing so could negatively impact both your credit score and your chances of getting approved for a new credit card account. Every time you apply for a credit card, your credit reports will be subject to a hard inquiry.
Can you apply for 2 credit cards at the same time?
Perhaps you want to apply for multiple cards at once because you’re unsure which ones you’ll be accepted for. Alternatively, you might want to benefit from some fantastic welcome offers for various cards. It is entirely possible to make multiple applications at once for any reason you choose.
Will multiple credit card applications affect credit score?
The hard inquiries that applying for several cards will cause to appear on your credit report will have an impact on your credit score.
Do multiple credit card inquiries count as one?
Ulzheimer states, “For scoring purposes, any hard inquiries that occur within 14 days of each other are considered one inquiry.” Credit card, mortgage, auto, student loan, and any other hard inquiries fall under this category. “.
Read More :
https://www.experian.com/blogs/ask-experian/can-you-apply-for-two-credit-cards-at-once/
https://www.forbes.com/advisor/credit-cards/should-you-apply-for-multiple-credit-cards-at-the-same-time/