6 lessons I learned from my rejected credit card applications

Editor’s note: This post has been updated with new information.

With all our talk of Maldivian vacations and luxurious first-class flights, you might be fooled into thinking that nothing ever goes wrong for the points pros here at TPG. While it’s not always fun to talk about, rejected applications are simply a part of life in the points and miles world.

Since 2015, I’ve submitted a total of 41 credit card applications. Of those, 13 were rejected (including a few rejections for the same cards). While it’s never fun to have your hopes dashed like that, I’ve done my best to learn something from each rejection, either about the specific card or issuer in question or about the broader state of credit card rewards.

Here are a few of the most valuable lessons I’ve learned from my rejected applications over the years.

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What to do if your application is rejected

Before I jump into my specific rejections, I want to highlight the fact that you don’t always need to take no for an answer. Just because an issuer denies your initial application, doesn’t mean you should give up hope. Issuers are required by law to give you a reason why your application was rejected. Once you have that information in hand, you should always call the bank’s reconsideration line and see if you can get the decision reversed.

Of course, just calling in and saying, “Please, I want it,” won’t work, but if you can explain to the reconsideration agent why they made a mistake and why you’d be a good customer, you might have some luck. For example, a common reason for rejection (especially as you get deeper into the points and miles game) is that the bank has already overextended your credit and won’t give you any more. A common workaround for this is to offer to transfer some credit from one of your existing cards to the new one.

There’s no guarantee that this will work, but given the potential upside, it’s always worth making the five-minute call to try.

Related: How bad is it to get denied for a credit card?

Too short of a credit history

The card I applied for: CitiBusiness® / AAdvantage® Platinum Select® Mastercard®.

Reason for denial: Less than one year of established credit history.

What I learned: When I was starting with my first couple of credit cards, I had a considerable advantage (no pun intended). Before I left for college, my dad had added me as an authorized user on his United Explorer Card, which he’d had open since before I was born. This meant that at age 20, I had 20 years of credit history and had no problem getting approved for the Chase Sapphire Preferred Card as one of my first cards.

I managed to successfully get approved for seven credit cards in my first year before I ran into my first rejection. Opening so many cards so quickly dropped my average age of accounts, an important factor that accounts for roughly 15% of your credit score, down from 20 years to just a handful of months.

This is how I learned the hard way that many credit cards will automatically reject you if your credit history is less than a year long. There was nothing I could say to change that; it was a hard rule and I wasn’t getting around it.

If you find yourself just starting out with less than one year of credit history (or even no history at all), that doesn’t mean there’s no hope for you. Focus on starter cards and build a relationship with the issuers you’re interested in, instead of applying for their best cards out of the gate. Speaking of which ...

The information for the CitiBusiness AAdvantage Platinum card has been collected independently by The Points Guy. The card details on this page have not been reviewed or provided by the card issuer.

Going premium too fast

The card I applied for: Chase Ritz-Carlton Rewards card (closed to new applicants).

Reason for denial: Not enough established credit history.

What I learned: The second major international trip I planned with my points and miles was two weeks in Thailand with my partner. I scored an elusive Cathay Pacific first-class award on the outbound flight and wrote my first-ever flight review for TPG on the way back, flying Air Canada 787 business class from Tokyo (NRT) to Toronto (YYZ).

This trip included a great mix of luxury accommodations and affordable Airbnbs, but after spending three nights on the island of Koh Pha Ngan for the famous full moon party, I wanted to surprise my partner with a few nights at the Ritz-Carlton Koh Samui. At the time, the Chase Ritz-Carlton Rewards card (now closed to new applicants) was offering a sign-up bonus of two free nights at most Ritz-Carlton hotels, and it seemed like it was meant to be.

Back in 2016, this card wasn’t subject to the 5/24 rule, so I thought I’d have pretty good odds. Unfortunately, Chase wasn’t interested in giving its most premium credit card (at the time) to a college student whose income barely exceeded his beer budget. While I’d had no problem getting approved for the Chase Sapphire Preferred and a handful of other Chase cards, I got the message loud and clear: Without a higher income or a more established credit history (or ideally both), premium cards would remain out of my reach for a while longer.

The information for the Ritz-Carlton Rewards card has been collected independently by The Points Guy. The card details on this page have not been reviewed or provided by the card issuer.

Inquiry-sensitive banks

The cards I applied for: Capital One Spark Miles for Business and Citi® / AAdvantage® Platinum Select® World Elite Mastercard®.

Reason for denial: Too many recent inquiries.

What I learned: The most frustrating rejections in my mind have always been the ones where I felt like I did everything correctly. I followed all the rules and still couldn’t get approved. In October 2017, I applied for two new cards, but got instant rejections for both.

So what went wrong? I’d already applied for nine credit cards that year, to say nothing of the 11 (eight approved and three rejected) from the year before, and while my credit score was above 750, my credit report was littered with recent inquiries. Unfortunately, Citi and Capital One are both incredibly sensitive to this. I’ve heard stories from plenty of friends with credit scores over 800 who both issuers have rejected for having too many recent inquiries on their credit report.

From the bank’s perspective, too many recent inquiries signal some level of desperation. Either you need access to more lines of credit (which suggests underlying financial problems), or you’re churning through welcome bonuses too quickly — either way, it means you’re less likely to be a valuable customer.

This isn't to say that you shouldn’t apply for Citi or Capital One cards if you have recent inquiries on your credit report, only that you shouldn’t be surprised if you get rejected despite having a high credit score.

Related: How does applying for a new credit card affect my credit score?

Forgetting about issuer-specific rules

The card I applied for: American Express Platinum Card® for Schwab.

Reason for denial: Too many cards opened in the last 90 days.

What I learned: Certain application rules like Chase’s infamous “5/24” rule are deeply ingrained in my mind. I’ve been over 5/24 for most of the last four years, and I knew the exact day I dropped back under this spring. Many other issuers have rules limiting the total number of cards you can open with them or how fast you can get new cards, and in my eagerness and impatience, I simply forgot.

In addition to its “once per lifetime” welcome offer policy, Amex only allows you to be approved for two cards in a rolling 90-day period. That’s about the most you should be applying for anyway, so I filed this rule away in the back of my brain and eventually forgot about it. When I went to apply for the Amex Platinum for Schwab, my application was automatically rejected, and there was nothing I could do about it.

Whether you’re new to the world of credit cards or an award travel veteran, it never hurts to double-check the rules before you click submit. Wasting an application that has no chance of getting approved made me feel pretty stupid, and a quick five-minute check could’ve saved me from making that mistake.

Related: The ultimate guide to credit card application restrictions

The information for the Amex Platinum Schwab card has been collected independently by The Points Guy. The card details on this page have not been reviewed or provided by the card issuer.

Forgetting the lesson about inquiry-sensitive banks

(Photo by John Gribben for The Points Guy)

The cards I applied for: Capital One Spark Miles for Business and the Citi / AAdvantage Platinum Select World Elite Mastercard.

Reason for denial: Too many recent inquiries.

What I learned: I’ve gotten a few Citi cards approved here and there, but Capital One has still never issued me a credit card despite three applications now and a credit score over 800. When the Capital One Spark Miles for Business launched its best-ever welcome bonus of up to 200,000 miles, I figured I’d chance it again. (The offer is currently 50,000 bonus miles after spending $4,500 on purchases in the first three months of account opening.)

Only five months had passed since my initial rejection, and while a few inquiries had fallen off my credit report, I’d replaced them with a few new ones. I knew my approval odds were low, but I decided to take the chance anyway. I was less surprised to be rejected this time around but equally disappointed.

Applying during a recession

The card I applied for: Ink Business Preferred Credit Card.

Reason for denial: “Insufficient balance in deposit and investment accounts with us.”

What I learned: I started my credit card journey in 2016, about halfway through the longest bull market run in history. Things were easy and good for many years, and I’ll admit I was shocked at how many cards I was able to get approved for with a student’s income.

Of course, the coronavirus pandemic ripped through the economy and sent the S&P 500 tumbling into a bear market in just 16 days — the fastest ever. After months of waiting, I finally dropped under 5/24 at the beginning of May 2020. I was eager to apply for the Chase Ink Business Preferred Credit Card, which offers a welcome bonus of 100,000 Ultimate Rewards points after spending $15,000 in the first three months of account opening.

I figured that a strong credit score and years of history with Chase would make it easy for me to get approved, but my application was rejected for “Insufficient balance in deposit and investment accounts with us.” Earlier in the pandemic, banks took drastic steps to lower their risk and exposure, including tightening up lending standards and cutting credit limits for existing customers.

I tried moving $20,000 into a Chase business checking account I already had open and explaining to the reconsideration agent that this was just a first step, and I’d be willing to make Chase my primary business bank if my application was approved.

Unfortunately, that wasn’t good enough, and I have to say this was the most disappointing rejection of all. I’m not sure how much money it would’ve taken to overturn the decision or if Chase was only approving long-term banking customers at the moment.

Related: How to recession-proof your credit score

Bottom line

There’s no sugarcoating it: Rejections of any kind are awful. Even though they don’t harm your credit score in any significant way (beyond the inquiry that appears even if your application is approved), it can be hard not to take them personally. If you are rejected, your first step should always be to call the reconsideration line and see if there’s any wiggle room. If that doesn’t work, the least you can try and do is learn what went wrong so it won’t happen again.

Additional reporting by Stella Shon.