What to expect when you apply for a credit card

Once you've selected a card that suits your needs you'll need to apply for it. Credit card companies ultimately decide which applicants get which credit cards and what their credit limits and interest rates will be, so expect to have a number of checks carried out on you. Your credit score (based on your credit history) will be one of the most important factors credit card companies will consider.

If you want to find out what your credit score is before you start applying you are able to check this out for yourself at www.experian.co.uk. A bad credit rating could exclude you from being able to take out a credit card or mean you are only eligible for high APR cards with certain conditions. Maintaining a good credit history is vital if you want to avoid problems during application.

All responsible credit card companies want to make sure that anyone they lend money to will be able to make the repayments, when you apply for a credit card most UK card issuers will require you to provide:

• some form of identification
• proof of your home address (up to the previous 3 years)
• evidence of your income and/or career history

They then combine this information with centrally held information which is legally shared between credit companies and credit reference agencies, which includes information such as the number of loans you have, whether those loans are being paid on time and whether you have any outstanding loans.

Have your bank account details with you as it will make your credit card debt easier to manage, and avoid late payment penalty charges, if you set up a Direct Debit for your regular payments. If you want to repay your balance in full each month and this option isn't noted on the Direct Debit form just hand write on the form that you wish to "repay the balance in full", once your direct debit is set up, check it is working and paying the full amounts due each month.

Only make one credit application at a time as it can adversely effect your credit score if you have multiple applications being checked at the same time.

In addition to the application requirements above, the table below outlines what to expect when applying for a credit card through different types of issuers:

When applying for a credit card via...	You can expect...
an online issuer	To complete an online application form and submit it for processing. Some online lenders promise instant decisions. This is usually the quickest and easiest way to apply for a credit card, make sure you are using an authentic and secure website. All reputable credit card issuers should be registered with the Financial Services Authority (FSA) and will be listed on the FSA Register.
a high street Bank or Finance company	After making an appointment or coming in off the street, an advisor will take you through the application process step by step. You will either complete a paper or online application form while at the branch. You may get a decision on the spot but it can take longer.
the telephone	A toll free number advertised in the media, online or the yellow pages. You may be put through to a recorded set of step by step instructions or your information may be taken by a customer service assistance over a recorded call. A paper copy of the application will usually be forwarded to you for signing. You may get a decision over the phone, but more likely will need to wait until you have returned the signed form.

In all cases double check information you have supplied on forms, check the credit card issuer's privacy statement and ensure forms you sign are originals from the actual Credit Card issuer, not photocopies.

If your application is approved make sure you fully understand the terms and conditions of your new card, including:

• the actual APR you will be charged
• other interest rates and charges
• the credit limit on the card

These will be provided by the credit card issuer as part of the approval process. Remember to keep copies of any documents you have signed, the credit card terms and conditions and any related insurance documents in a safe place for future reference.

Your initial research and shopping around should now pay off and you can reap the financial benefits of a card that works well for you and offers value for money. However, always take time to review it regularly and make sure it is still working for you, ask yourself:

• Are you using all it's features?
• Are you paying more interest and charges than you'd planned?
• Do you get the benefit of it's rewards and incentives?
• Are you managing to repay some or all of the debt each month?

If your credit card company writes to you saying they have increased your credit limit, you are not obliged to take the increase, you can write back to tell them you don't want to increase your limit. You can even ask for a new lower limit if you want.

If at any stage you feel like the card is starting to manage you rather than you manging it, take action quickly to either repay it in full or transfer to another more suitable card to avoid your credit history being negatively affected. That way you can continue to take advantage of the financial flexibility that the right credit card when managed well can offer.

Download the Credit Cards PDF Guide here - see our other free PDF guides here

Guide Contents

Thinking about credit cards?
How to manage credit card transfers and debt
Compare Credit Cards and find the right card for you
Understanding credit card charges
Shopping around for the best credit card deals
What to expect when you apply for a credit card
Credit card FAQ - eg. What Are 0% and Interest Free Credit Cards
Where can I go to get more credit card help?

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