Most people who apply for a credit card will experience rejection at some point for numerous reasons. The main idea is to understand the most common reasons why people do not get the credit cards they need. As a result, you can determine the best course of action and ensure a provider approves your application.
We agree that credit cards have become a popular payment method worldwide, especially in Norway. Nowadays, there are more than six million credit cards in Norway alone, meaning four million adults use them daily, which is a significant number compared to the past.
At the same time, the interest rates are continually rising due to world economics and recession caused by wars and energy issues.
These factors created financial constraints for numerous people across Norway. As a result, credit cards have become perfect alternatives for paying unforeseen expenses, handling bonuses insurance, and enjoying other advantages. Still, only a specific number of people can obtain credit cards, and we can differentiate numerous reasons.
In a future article, we will discuss the factors determining whether you can obtain a credit card. Let us start from the beginning.
Why Can’t You Get a Credit Card?
We can differentiate numerous requirements to obtain a credit card application. Still, before understanding the requirements, you must understand the common reasons providers reject various individuals.
1. Lack of Norwegian Citizenship
One of the most important factors when applying for a credit card in Norway is the indispensable requirement that you must have valid citizenship, which indicates that you have lived and worked in Norway for a long time. We recommend you to visit this link: kredittkortinfo.no/hvorfor-får-jeg-ikke-kredittkort/ to learn more about this topic.
2. Legal Age
You can only apply for a credit card if you are eighteen. Of course, the age requirements vary based on a provider and other factors. Still, generally, some banks and lending institutions will require you to be older than eighteen to be able to participate and apply.
One of the biggest reasons you cannot get a credit card is because it can cause severe debt to your financial situation. Having a credit card requires a steady job and the ability to be responsible while paying, which will reduce the need to spend more than you wanted in the first place.
Offering young people credit cards is like putting them in a vicious debt cycle. They must learn to handle daily responsibilities before they can take out a loan and repay it.
A credit score is another important consideration, which is why most people who are eighteen years old are co-signers of their parent’s credit cards, meaning they can reap benefits from family cards.
3. You Have Too Many Credits Cards
If you live in Norway and have an open credit card, even if you are not using it, a credit rating company considers it a debt. This means that having a few cards with a considerable limit will affect your overall debt-to-income ratio, whether you regularly use them or not.
As a result, if you have an old card with a 150 thousand kroner credit limit, but you only use a thousand, the burden will still consider the maximum amount you can take. Therefore, a provider may reject you if they determine you have a considerable burden. It is way better to cancel specific cards you do not need anymore and apply for new ones you need.
4. No Payment History
Suppose you have reached a legal age for numerous things you can do across Norway. However, one of the most critical factors in credit score calculations is payment history, meaning the lack of it will highlight that you are a risky borrower without a clear past of regular payments.
It is a common reason providers will not consider your application as worthy, meaning you must do things to boost your credit score before applying. You should enter here to learn more about obtaining a credit card for your specific requirements.
5. Low Credit Score
The main idea is to boost your credit score before applying for a credit card, which will help you get the best interest rates and perfect rewards that will stand the test of time. When you apply for a credit card, a bank will conduct a credit check to determine your creditworthiness.
The main reason is that they will assess your finances and refrain from providing you with a card in case you cannot handle the debt each month. Without a healthy credit rating, you cannot get a card in Norway, which applies to most countries across the globe. This is a law regulation, meaning banks must determine your creditworthiness before deciding.
After a credit rating assessment, they calculate a credit score indicating a risk you represent to a bank if they decide to lend you money. As a result, people with low scores will not get the relevant amount they need, while things will be entirely different for people with high scores.
It is simple to determine a low credit score by following specific factors, including:
Low Income
When a specific bank makes a credit assessment, your income will be the essential aspect that will determine whether you can repay a specific debt. The main idea is to ensure enough income to handle a debt.
If you have a low income, that will directly reduce your score, meaning they will reject your application. If you wish to get a credit card, you will need income over fifty thousand kroner.
For instance, if you have payment notes, the chances are high that a provider will reject your application without exception. Payment notes are indications that you should have paid past loans and followed payment requirements, meaning banks will not offer you new loans in the future.
Lousy Payment History
As mentioned above, the bank will analyze your payment history when conducting a credit check. If you have ongoing debt collection cases or outstanding payment claims, your score will be lousy, meaning they will reject your application.
Payment Notes
The main idea is to avoid obtaining outstanding debt collection claims because that will result in a payment note, which will prevent you from getting any loan in the future. When you apply for a credit card, personal loan, or any other debt with payment notes, banks or other lenders will reject you without a second thought.
Lot of Debt
When you apply for a credit card, especially if you have a lot of debt, the provider will determine the amount you must spare for the current loans and whether you can handle a new one. Even if you have a perfect score, too many credit cards will drive it down, meaning banks will not risk giving you another debt.
Things You Can Do to Prevent Rejection
As you can see from everything mentioned above, it is vital to consider various factors before applying. For instance, you must be of legal age, have a permanent residence address, have a good to excellent credit score, and not have additional debt to obtain a credit card in your name.
Still, you should follow these tips to help you prevent rejection and ensure the best course of action. For instance, one of the most important and influential ways to obtain the most viable option is to improve your credit score. You can handle it by following certain factors, including:
1. Credit Rating
The main idea is to start slow. You should conduct a credit check on your specific situation to determine whether you can get a card. That way, you can see which areas you can improve. You should work on paying everything on time, dealing with outstanding debts, and preventing issues that can happen with missing a single payment.
By understanding each step along the way, you can determine your current situation and whether you are eligible for a specific loan. The easiest way to assess the loan is through different credit bureaus such as Experian, among others.
For instance, if a provider rejects your application, you should analyze your finances and determine why. You can assess yourself using an Experian website, which gives you more prominent insight into areas where you should improve. That way, the next time you apply, you can obtain a card you wanted in the first place.
2. Reduce Debt
Suppose you owe a lot and have considerable debt, especially a consumer one. In that case, you should find ways to reduce it significantly before applying. The easiest way to check out your debt is by visiting the Norwegian Debt Register. That way, you can determine the overall amount you owe, which is a perfect way to reduce your debt.
According to Norwegian regulations, your debt should be at most five times your annual income, which is vital to remember. One way to reduce your debt is through refinancing. When you decide to refinance a current mortgage or consolidate credit card debts, you can streamline a few small loans into a single payment.
The best course of action is to ensure that the interest rate on refinancing loans is lower than the one you use on other consumer loans. That way, you can rest assured and deal with the debt faster than before.
