How often should you apply for a credit card?

The fastest ways to improve your credit score are to pay down your balances, dispute incorrect information on your credit report, make more frequent payments, and reduce credit utilization. Credit utilization (how much of your credit limits you use each month) contributes to a portion of your credit score that accounts for 20% - 30% of your overall score. So, an adjustment there can result in a big credit boost pretty quickly. Similarly, you can dispute incorrect information with a quick online request or phone call. You won’t always get an immediate credit score increase, but correcting errors on your credit report is a great place to start.… read full answer

There are a few other ways to increase your credit score quickly, from becoming an authorized user to increasing your credit limit. They may not all be equally effective for everyone, as it can take years to build a consistently good or excellent credit score. In fact, some strategies could send your credit score in the wrong direction before leading to an increase. For example, requesting a credit limit increase can result in a hard inquiry that damages your credit a bit in the short-term, but having more credit available could produce long-term gains if used responsibly.

Here’s how to improve your credit score fast:

1. Pay down your balances. If you aren’t eligible for a credit limit increase, focus on paying down existing debt. Paying down a large chunk of debt at once will help your credit utilization ratio and bump up your score. If you can’t make a large payment all at once, try to pay more than just the minimum monthly amount. If you have multiple debts, start by making payments on the debt that has the highest interest rate so you can limit interest charges.
2. Dispute incorrect information on your credit report. You should file a dispute for any incorrect negative info on your report. Once the dispute goes through, incorrect items will drop off your file, and your score should improve. You may have to wait 30 days for the credit bureau to review your dispute before you see any changes.
3. Make more frequent payments. Credit utilization is calculated based on the statement balance on each of your credit cards. You can reduce these balances, thus decreasing your credit utilization and increasing your credit score, by making payments before the end of each billing period. Then, pay off the remaining balance by the due date to avoid interest charges and credit-score damage.
4. Become an authorized user. If you’re just starting out, or your credit report has a string of negative marks, a good move would be to become an authorized user on someone else’s credit card and build your credit over time. Just make sure the primary holder is responsible and pays their bills on time.
5. Add new payments to your credit file. There are new services that can add positive information, like on-time utility payments, rent payments, and positive bank balances to your credit report. Not all of these programs apply to all credit bureaus, and some cost money to utilize, but they could boost your credit score over a few months.
6. Increase your credit limit. A higher credit limit can reduce your credit utilization ratio, assuming your spending does not increase. The only potential problem is that asking for a credit limit increase usually results in a hard credit inquiry, which would temporarily hurt your credit score a bit. But if you get a credit limit increase without asking, or you have a few months before you need the highest credit score possible, a higher limit could definitely help.

Everyone’s credit situation is different, so not every option will be relevant or available to you. The best way to find out exactly what you can do to quickly improve your score is to check out the personalized advice in the Credit Analysis section of your WalletHub dashboard.

There’s no rule against applying for multiple credit cards in one day, but doing so may hurt your credit standing as well as your chances of approval for a new credit card account. Each time you apply for a credit card, the credit card company does a hard pull, or inquiry, on at least one of your credit reports. For most people, one hard inquiry will cause a credit-score decrease of less than 5 points—not a huge impact. But even applying for 2 cards in a day could potentially bring a score down by 10 points or more. Depending on the content of the rest of your credit report, the negative impact could multiply with more hard pulls. That could mean the difference between good and fair credit, for example, or fair and bad credit. If you’re planning to apply for a mortgage or other major loan anytime soon, having a lower credit score could cost you a lot of money, too.… read full answer

A hard pull can affect a credit score for up to a year, and will drop off a report completely in 2 years. Even though the effect is temporary, it’s worth considering whether or not your score can afford that kind of drop for a year. In other words, do you need your score for anything important during that time?

If you apply for more than one card in a day, it's possible that some or all of these applications will be approved. That too would have an effect on your credit standing. A few new lines of credit will increase your total available credit, lower your overall credit utilization, and decrease the average age of your credit. The first two are good for a credit score but could quickly turn bad if you misuse your new credit. The third could also have a negative impact. A cluster of new credit lines could look like you’re desperately trying to borrow, which could be a sign of budding financial problems, making you look riskier to potential lenders.

If you’re applying for multiple cards at the same time to increase your odds of one approval before a hard pull hits your score, reconsider this approach. It will only hurt your score in the long run. If you don’t get approved for the first card you apply for, there are always lower-tier offers to consider, including credit cards with no credit check.

A good rule of thumb is to pick your credit applications wisely – measure twice and cut once, so to speak. Do some research to find the best credit cards for your needs, and choose the cards with the best approval odds based on your circumstances. Many credit card issuers let prospective customers check for pre-approval through the company’s website. Pre-approval results in a “soft pull” on your credit, with no score damage, and provides a good sense of your likelihood of approval before you apply for real. That way, you’re not wasting hard pulls on a credit card you have no chance of getting.

At the end of the day, it’s best to apply for no more than one or two credit cards per year. This allows your credit score to recover from each hard inquiry and lets you get accustomed to managing a new account. That said, people who can manage their card usage responsibly will benefit from gradually building a collection of multiple credit cards. With 2 or 3 cards, for example, you can take the Island Approach with your expenses. More cards than that can complicate due dates but will allow you to mix-and-match more types of rewards, rates and features. And be smart: set up automatic payments.