The best time of year to apply for a credit card is October through December, judging by the higher rate of new accounts being opened then. The busy holiday shopping season and the attractive bonus offers that credit card companies have been known to roll out around then have a lot to do with Q4 being a good time to apply.
More generally, the best time to apply for a credit card is after you’ve carefully considered your options and selected a card that suits your needs. In addition, you should avoid doing it right before you’re going to ask for a large loan, or right after you’ve applied for another source of credit. That’s because each of these puts a hard inquiry on your credit report, which hurts your score, especially when there are several in a short period of time. If you have bad credit, it’s essential for you to have at least one account in good standing in order to rebuild. And if you have good or better credit, you have a lot of options for cards with great rewards and rates.
Those aren’t the only dynamics you should be aware of if you want to boost your odds of approval, either.
Here are the best times to apply for a credit card:
- When you’re ready. Don’t rush into a decision. Take time to examine your options and pick a card that best suits your needs, whether that’s rewards, financing, balance transfers or something else. If you sign up for a free WalletHub account you can get personalized credit card recommendations that you’re likely to qualify for.
- When there aren’t recent or upcoming inquiries. Having a hard inquiry on your credit report (which happens when you apply for credit) temporarily damages your score a bit. But multiple inquiries within a few weeks or months of each other are worse than just one. So if you applied for credit recently or are about to apply for a mortgage or car loan, you may want to hold off on that credit card application.
- After pre-approval. Many credit card issuers let you check for pre-approval, allowing you to see if you’re a good candidate without a hard inquiry, which could temporarily hurt your credit score. If you’re pre-approved, you’re not guaranteed actual approval, but your chances are high – around 90%.
- When your credit is bad. If you have bad credit, you’ll need at least one credit card in good standing to start balancing things out. You should try for a secured card, which has the highest approval odds, to help rebuild.
- When your credit is good. When you have good or excellent credit, you’ll have a ton of great options with high approval odds.
- When you don’t have one. A credit card can make shopping a lot easier, and can even reward you for spending. And it’s essential for improving your credit and building up a solid history so that you can make big future financial transactions, like auto loans and mortgages.
- When there’s a great rewards offer. Credit cards often give big initial bonuses or 0% financing for a limited time to draw in new customers. Strategically taking advantage of such offers can get you hundreds of dollars in cash back or travel.
- When you’re making a big-ticket purchase. Applying for a 0% APR credit card before making a big purchase that will take months to pay off can be a wise move. It will enable you to avoid interest entirely if you pay in full by the time your card’s regular APR takes effect.
All in all, any time can be a good time to apply for a credit card. Just make sure to do your research and maximize your credit score beforehand. As long as you don’t need the best credit possible for a major loan application soon after applying for a credit card, the temporary credit score damage that comes with it won’t cost you.