Approval for Credit Card Applications is Becoming Increasingly More Difficult

When an individual applies for a credit card there are several factors taken into account that include not only if they are going to be approved for a credit card or not but also what terms they will receive as far as interest rates and lines of credit go. These factors can include, but are not limited to, the applicant’s credit history, employment status, amount of debt on existing credit cards, outstanding loans including mortgage and automobile and so on.

The USA Today recently reported that there will be another factor that will play a role in determining credit card approvals. Bank of America, Capital One, Wells Fargo, Citibank and other major credit card issuers are now looking at the bank accounts of those that apply for their credit cards. The idea behind it being that the way the individual manages their banking account can be used as an indication of how they would manage their credit card account.

So in effect it is the same principal as the other factors that are looked at. It is more or less a barometer of how responsibly people manage their money. The whole idea actually makes quite a bit of sense when you consider that the banks and credit card issuers are now facing record default numbers. They must be more responsible about whom they approve for credit cards then they have been in the past.

This of course, will mean that more people will be denied a credit card but this is a trend that is sure to continue, at least in the near future. Whether the credit card companies want to admit it or not they cannot just blame the poor economy for the problems they are having. The fact of the matter is that they were approving credit cards for people with a poor credit history or no credit history at all and now it has come back to bite them hard.

Because of this the credit card companies are now pretty much forced to act more responsibly when determining who they give their credit cards to and how much of a credit line they offer them. It will stay this way to as this current recession continues to drag on, unemployment remains in double digits and credit card debt hovers around the $1 trillion mark.

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