Applying for a new credit card is exciting, but it can also be nerve-wracking while you wait to find out whether or not you’ve been approved. Thankfully, many credit card issuers offer instant approval credit cards, where applicants can find out in seconds if they qualify. Not only does this help to streamline getting a new card, but it also gives you the tools you need to build a good credit score.
How instant approval credit cards work
In the past, when you’d apply for a credit card, a credit card company would have to manually review your application before reaching a decision. This process sometimes took as long as one to two weeks before you’d receive a letter from the issuer letting you know if you’d been approved.
Thankfully, many of the major credit card issuers recognized that a lot of the criteria used to screen applicants could be evaluated using automated software. This enabled them to take the inputs entered by online applicants and give them an answer instantly.
How can instant approval credit cards help me build credit?
There are several ways that you can use credit cards with instant approval to help improve your credit score:
Increased credit limit
If you have more than one credit card, your total amount of available credit can increase. That’s important for helping your credit utilization ratio. This ratio is simply the total balance you owe divided by your credit limit. Having more available credit decreases your credit utilization ratio and positively affects your credit score.
Better credit usage opportunity
Instead of waiting on a decision, instant approval cards give you a chance to start using credit as quickly as possible. Doing something as simple as paying your bill on time and in full will build a strong credit history and demonstrate that you can responsibly manage your credit.
Age of credit
The sooner you become instantly approved and can start using your new credit card, the longer you’ll be able to keep it open. This is beneficial because an older account in good standing will positively impact your credit score.
Additional benefits of instant approval credit cards
Building your credit is essential, but there are plenty of other good perks that can make getting an instant approval credit card worth it:
Many credit cards with instant approval come with built-in opportunities to earn rewards. You may redeem these rewards for cash back, gift cards, or even free travel.
No annual fee
You may be able to reap the benefits of an instant approval credit card without having to pay an annual fee. If this sounds like a benefit you’d be interested in, look for credit cards with no annual fee when narrowing down your options.
Balance transfer opportunities
If you already carry a balance on one or more other credit cards, you can leverage balance transfers to your advantage. This is done when you transfer debt that’s accruing high interest onto a new credit card that doesn’t charge any interest for a certain period. New cardmembers can use this as an opportunity to pay down their balance before the 0% APR period ends.
There’s no end to the number of perks that instant approval credit cards can offer. Some allow you to check your bags for free on your favorite airline, while others come with built-in insurance that can extend the warranty on items you’ve purchased.
The bottom line
Don’t wait to find out whether you’ve been approved for a new credit card. Instead, apply for a credit card that may offer instant approval and learn in seconds if you qualify. The sooner you get a new card, the sooner you can start using it responsibly to build your credit. Additionally, you’ll be able to enjoy the many perks that come with these credit cards, such as rewards points, balance transfer opportunities, and other useful benefits.
Name: Carolina d’Arbelles-Valle
Job Title: Senior Digital PR Specialist