Have a credit card and planning to apply for another? Having a card doesn't mean you can't apply for a second one, but you do need to be careful how many you have on the go. Find out more in our guide below.
If you missed part 1 of our guide, click here to read it now.
39.9% APR Representative (variable)
Intelligent Lending Ltd (Credit Broker). Capital One is the exclusive lender
“if you’ve got too many cards, this can actually be a bad thing...”
Keeping on top of several payments isn’t the only thing that could potentially be a problem when you have a few different credit cards. If you’ve got too many cards, this can actually be a bad thing for your future borrowing ambitions.
Lenders will see that you’ve already got access to a lot of credit, so if you’re applying for further credit – perhaps a loan or a mortgage - they might turn you down. They may decide that as you’ve already got so much credit available to you, even if you’re not using it, that any more could make maintaining your repayments unmanageable.
But how many cards count as too many? As we’ve already said, there’s no set number for this. Instead, you should assign yourself a personal limit and not take on more credit than you need. If you’ve got a 0% balance transfer card, a rewards card and the card you use for everyday spending, this may be enough, but that’s up to you of course!
If you’ve had difficulty managing credit in the past, such as missing payments on your current credit card or defaulting on any loans or mortgages, you might find it’s a challenge to get accepted for another card. This is because these issues will show up on your credit history and lenders might regard you as too much of a risk to let you open another card.
To reduce your chances of being rejected for credit in the future, it’s best to focus on rebuilding your credit history. Cancel any credit cards you’re not using or that have high credit limits and just concentrate on using one card responsibly. You might also decide to open a ‘credit builder credit card’, designed for people who’ve had problems borrowing in the past and who want to improve their credit history.
One card you could consider is the Ocean Credit Card, which is designed for people looking to rebuild their credit history. With a fairly low initial credit limit, it makes it easier for you to stay in control of your borrowing and not take on more credit than you can afford to repay.
If you use the card to borrow small amounts and pay it back each month on time, this demonstrates to lenders that you’re able to manage credit responsibly. This may make it easier for you to borrow in the future. It's important to remember though that missing or making late payments could harm your credit rating.
The Ocean Credit Card has an interest rate of 39.9% APR representative variable, with an initial credit limit of £200 to £1,500. The amount of credit you’ll be accepted for will depend on your credit history, so if you’ve had problems with credit in the past, you might be offered a lower credit limit. Don’t worry – try and use the card responsibly at the current limit by making all of your payments in full and on time and you could be offered up to two credit limit increases in a year.
You can apply online for the Ocean Credit Card or find out more information about how it could help you manage your money by clicking here.
39.9% APR Representative (variable)
Intelligent Lending Ltd (Credit Broker). Capital One is the exclusive lender