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Getting a new credit card is always subject to application approval from the
bank or provider. The exact requirements you’ll need to meet vary between credit
card providers, but there are a few general terms and conditions you’ll need to
meet across the board.
This guide outlines the eligibility requirements and information you need to
provide to ensure your credit card application process goes as smoothly as
possible.
What are the eligibility requirements?
The start of your credit card
application will include a small section to verify that you qualify and that you
have read and understand the terms outlined by the provider. These
criteria vary based on the card and provider, but generally include the
following:
-
Age. You must be at
least 18 years of age to apply for a credit card in Australia.
-
Residency status. Most
credit card providers require you to be a permanent resident or citizen of
Australia. There are also a limited
number of cards available for
temporary residents with valid visas.
-
Income. Some credit
cards list a minimum income
you're required to earn to be eligible to apply for the card, such as
$30,000 or $70,000.
-
Credit status. You
must have good credit history to apply for a credit card.
If you meet these requirements, you can continue to the main part of the
application. This is where you'll be required to provide a variety of
information to the lender.
What information will I need to provide on my application?
The order of this information could vary depending on the credit card you're
applying for, but you will need to include details in the following categories.
Personal information
Most credit card applications begin by requesting details about your personal
information. Ensure that all the following information you provide is correct:
-
Personal information. This
includes your full name and date of
birth.
-
Residential information. At
this stage of the application, you may also be required to provide
details or your Australian residency
status.
-
Proof of identity. You will
need to provide proof of identification such as a
passport or driver’s licence.
-
Residential address. These
details relate to your current home
address and the length of time you have been there. In certain cases,
you could also be asked to provide information on previous residential
addresses.
-
Contact details. Most
lenders now require a valid email
address as well as a phone number.
-
Dependents. This is the
total number of dependents
(ie. your children).
Note that if you are applying for a joint
credit card account, all of the same information will be required for the
additional applicant.
Employment and income information
The financial institution that you are applying with may want to verify that you
are receiving a steady income. To do this they will ask for:
-
Your occupation. For example, you'll need to provide
your title and the field you work in
(e.g. media, education, management).
-
Employer information. You'll
need to specify the amount of time
you've been with your current employer and provide your employer’s name and
contact information. In some cases, you may also be asked to list previous
employment details as well.
-
Income. Include details
of your annual income before taxes,
as well as any secondary income you may receive.
-
Self-employed. If you
are self-employed when
applying for a credit card, you may need to provide
your accountant's information and
previous Tax Assessments in order to verify your income.
Financial information
The financial information portion of a credit card application helps to
determine if you qualify for the card. It also helps in determining your credit
limit. Information you'll need to provide here includes:
-
Account details. This
includes details for savings and
transactions accounts, along with the current balances.
-
Assets. Assets
could include savings, investments, property and major items in your home.
-
Monthly expenses. You will be asked to provide
details of your monthly financial
obligations, including payments for rent, mortgage and other living expenses
(such as groceries and fuel). If you are unsure of some of these expenses,
you can estimate them by looking at your transaction account details for the
past few months and working out an average.
-
Credit and other liabilities. You'll
need to provide details of any
existing credit accounts and liabilities, such as cards, personal loans or
mortgages.
Card preferences
At some point in your application, you will be asked for your card preferences
and given the option for a balance transfer. Information in this section will
include:
-
Credit limit. You
can choose between nominating a specific credit limit or having the lender
assign a limit to you. If you decide to request a limit, consider
your spending habits as well as your current financial circumstances so that
you can choose a figure that is likely to be approved and also manageable
for you.
-
Additional cardholders and their details. If
you have an eligible partner or dependent who you’d like to add as an
additional cardholder, make sure to have their personal details on hand for
this part of the application. You will need to provide their full name, age
and contact information.
-
Balance transfer. If you are
applying for a balance
transfer from an existing
card to the new card, you will need to
include details of your current
credit card account, the financial institution and the amount of debt that
you wish to transfer. Make sure you have your card details, as well
as the BSB for your current provider on hand. Also note that you may not be
able to transfer the balance from a card that is issued by the same
provider. For example, you can't transfer a balance from one Westpac card to
another Westpac card. Read our guide for a full
list of banks you can balance transfer between.
After you have completed these steps, you will be asked to review your details
before hitting the "submit" button. Thoroughly check your form for accuracy, and
remember that the application cannot be recalled once submitted. It will trigger
an enquiry on your credit file, so make sure it’s worthwhile.
What else do I need to remember when applying?
-
Supporting documentation. After
you have submitted the initial application (or during the application), you
will also be required provide documentation that supports the information
provided. This typically includes
identifying documents with a photo, several recent payslips and/or tax
documents.
-
Document submission. Check
how the process works for verifying your documents. In some cases,
you may be able upload copies online
via a secure service, while in others you might have to bring them to
a branch.
-
"Instant" approval. Most
credit card applications you submit online will provide you with a response
within 60 seconds. Remember that if you are approved at this stage, you may
still have to provide the supporting documents in order to receive and
activate your card.
How to get your credit card application approved
If you do the research first and gather together all of the information
required, filling out a credit card application online will only take a few
minutes. And thanks to the convenience of 60-second approval times, you could
know within 15 minutes of clicking “Apply now” whether you will be getting a
brand new credit card.
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Information verified correct on December 17th, 2016
If you've had troubles in the past to a credit
card application approved then
fear no more as with our handy guide
you should be successful in applying for any credit card from herein.
When credit card applicants get denied it is usually for the reasons
outlined below. In short, they have:
-
A bad credit file rating.
-
They don't earn enough income
according to the card issuer's stipulation.
-
They've had delinquent accounts.
-
Their financial history is too
short or unstable.
-
Or they've had a lot of queries
on their credit file which often indicates trouble.
Order a copy of your credit file
Receive email alerts whenever specific changes occur on your credit
file for 12 months. You also receive a copy of your credit file
despatched within one working day..
What information is included in your credit file:
-
Details of consumer credit enquiries
-
Details of overdue consumer credit accounts
-
Commercial credit enquiries
-
Details of overdue commercial credit accounts
-
Bankruptcy & Court Judgements
-
Writs & Summons
-
Information on your current relationship with a credit issuer
Why might a bank reject my credit card application?
Having a bad credit file rating
If your credit is bad, it means that lenders have had problems with you in
the past. Those get recorded in a national database and any potential lender
has access to your credit file. Therefore it is important to ALWAYS pay your
bills on time!
Setting up direct debit certainly helps with this process. Alternatively you
can develop a proven system that works to remind you to pay your bills on
time. Failing to do so will damage your credit rating.
To find out where you stand with your credit file you can obtain a copy of
it by visiting the MyCreditFile website
and pay $29.95 incl. GST to be faxed, mailed or emailed a copy within 24
hours.
A lack of income
Some card issuers will not approve you if your income level is below what
they stipulate. The American
Express Platinum credit card for
example requires you to earn $100,000 minimum or else you will not be
approved, even if you pay your bills on time.
This has a lot to do with their own financial security as they offer you
additional insurance - at no extra cost, plus much more.
Most credit card issuers publish
their income requirements for any given card in their terms and conditions.
Make sure to check those before you apply.
Delinquent accounts
If you ever had a delinquent account to your name -
meaning you were 60 days past due
with your payments - then chances are your credit card application
approval will not happen. This information usually becomes nullified after
five years have passed. Lenders want to be sure that you can handle
repayments because if you don't, they stand to lose their money.
A short or unstable financial history
Most lenders want to see stability
to get your credit card application approved for you. If you are
constantly changing jobs or your place of residence it will look bad on your
credit file. This indicates that you are not reliable enough - you can't
hold a job or a residence - a big warning sign for lenders.
Before you apply for any credit card be sure to have a solid employment
history with a minimum six month track record.
If you have existing bad debt on your record you can take pro-active action
to show potential lenders that you are serious about fixing your past
errors. Pay off all past debts before applying for a credit card (excluded
in this tip would be a home loan).
Too many credit file queries
Whenever you apply for a line of credit, a loan and a credit card, potential
lenders can view your credit file. Each time this happens, the activity will
be recorded in your file for a total of five years. Naturally any lending
institution can see how many refused applications you've had in the past
according to the activity shown on your file.
Whether you do your credit card application online or offline, you need to
understand what's expected of you before you take that step to increase your
chances of getting your credit card application approved.
See:
Veda Advantage Ltd
SocietyOne hands credit scores power to customers
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