Denied for a Secured Credit Card? Know Why & Try New Ways to Get it Now
Credit Education accomodation Secured Credit Cards

Denied for a Secured Credit Card? Know Why & Try New Ways to Get it Now

Moumita Basu

Table of Contents

Secured credit cards demand a down payment as security for your available credit. People generally believe they will be approved if they have the necessary cash because that deposit typically equates to your account's credit limit. But the truth is your issuer could still decline your application if you don't satisfy the card issuer's requirements. These requirements, which might range from your credit scores, income, and outstanding debt, are what a card issuer anticipates from a borrower.

Don't give up, though. You can repair or start credit by getting credit card approval. Want to know how? Read on!


Possible Reasons For Denied Secured Credit Card

If you were denied a secured credit card, the company issuing the card or the lender should have sent you a written notice outlining why. If you have questions, correctly read the letter and contact the issuer. Additionally, you should check your credit report for accuracy. Here are several explanations for why a card issuer can deny a request for a secured credit card:

  • Although secured credit cards are for persons with bad credit, card issuers may impose minimal standards. Those applying without credit history or bad credit may need to start building credit first
  • You may have a poor credit score despite having a long credit history. Your application for a secured credit card may be denied if you don't meet the card issuer's credit score restrictions
  • If you are going through bankruptcy, have previously charged off credit cards, or have skipped credit card payments, you could not be eligible for a secured card
  • You'll frequently need a bank account to fund the deposit necessary to open the secured credit card account. You also need enough money on hand to pay the deposit. You might need to wait until you have a bank account with the required amounts before reapplying if you don't have one or cannot pay the security deposit
  • Before opening a credit line for you, lenders must verify your "capacity to pay." The card issuer may reject your application if you don't have any income or don't make enough money to pay your monthly bill

Best Approach to Getting a Secured Credit Card

If you wish to reapply for a secured credit card, here are some suggestions to help you build your credit:

  • Credit-building loans: To receive your funds from these "loans," you must first make regular contributions into a savings account. You can improve your credit score and develop positive habits by doing this, but you should exercise caution as many demand additional fees
  • Obtain authorization to use: By connecting your credit report to theirs, this option enables you to "piggyback" off of a friend's or family member's Favorable Credit Score. As your actions will affect the other person's credit score, you should only select this option if you and the primary cardholder are comfortable sharing financial responsibility
  • Pay your rent and utilities as you go: You can report your on-time utility, internet, cable, and phone bill payments with Azpire Card
  • Individual loans: Both secured and unsecured loans are available. Unsecured loans typically have higher interest rates without collateral, such as a car title. Your rate is probably going to be lower the better your credit is. If someone with bad credit can secure a loan, they can anticipate paying at very high speeds

So, if you have not been approved for a secured credit card prior, recheck your application to determine whether you have misinformed some questions, and reapply. This time apply for a secured card like Azpire that doesn't run a credit check if you want to further reduce your chance of being rejected. Your credit history won't matter, but you'll still need to meet the qualifying standards. You can quickly get Azpire credit card for building credit at a zero percent annual interest rate with no subscription or hidden charges.

Frequently Asked Questions (FAQs)

Why did I get denied a secured credit card?

Even if you have the money for a deposit, you might not get a secured card if a lender thinks your credit history is too dangerous. Each lender, or card issuer, has a specific set of requirements for the ideal borrower. This includes your income, credit score, and past and present obligations.

What steps should I take once declined for a secured credit card?

Here are six steps you can do to increase your chances of success next time.

  • Review the Denial's justification and make your case.
  • Verify your credit score and report.
  • Take care of credit issues.
  • Use a different lender when you apply.
  • Keep an eye on your credit.
  • Keep a long-term perspective.

Can anyone get a secured credit card?

No. Application acceptance for a secured credit card is not assured because applicants for any form of the credit card must fulfill some minimum eligibility conditions, such as being at least 18 years old and having enough income to cover the bills. Credit card firms cannot guarantee approval for secured cards.

If once got denied a secured credit card, would my credit suffer?

Your credit ratings are unaffected by being denied a loan or credit card. When you apply, creditors might still check your credit report, and the subsequent hard inquiry might lower your scores.

What should I do if I am rejected for a secured credit card?

Get a copy of your credit report and challenge any errors if you get rejected due to false information. You could reapply after settling your bills or deleting certain accounts if your application got rejected as you have too many credit cards or a lot of debt.