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Does Getting Denied for a Credit Card Hurt Your Score?

A rejection doesn’t hurt your score. But your score may drop when you apply for a card, regardless of whether you’re approved or denied.
Nov. 30, 2018
Credit Score, Personal Finance
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Getting rejected when you apply for a credit card has an extra sting if your credit score drops, too.

But it can happen. One component of your credit score is how recently you have applied for credit. You can potentially lose a few points simply for applying.

The good news? Time can heal the damage. If you stop applying for credit for about six months, your score should rebound.

Still, before you apply, it’s smart to check your credit report and score, and to apply only for credit that you feel reasonably sure you’ll qualify for.

See how your score might change

Before you take action, use our credit score simulator to see how financial decisions may impact your score. Get your actual credit score, too.

If not the rejection, then why did my credit score drop?

The reason your score drops when you apply for a card is because doing so generally results in a “hard inquiry.” Lenders check your credit to make a decision about your application, which suggests more risk for the lender or card issuer. The more hard inquiries you have, the more of an effect it’ll have on your score.

The ‘no’ does not hurt your score, but the application does.

So the “no” does not hurt your score, but the application does.

Approval, though, can make the potential drop a lot more palatable — and it offers ways to balance it out. If you get approved for a credit card, for example, you have a larger overall credit limit. The percentage of your credit limit that you use is a major factor in your credit score. Only on-time payments count more. That extra breathing room can help your credit score.

If you get turned down for a credit card, you might be able to appeal it. Regardless, it’s smart to understand why the application was rejected so that you can be successful next time.

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