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Con: Application Impact on Credit Score
When you apply for a credit card, the issuer checks your credit history, known as a "hard pull." This can slightly reduce your score temporarily, regardless of whether you're approved. While your score will recover in under a year, the hard pull remains on your report for about two years.
Pro: Diversifying Your Credit Portfolio
If you have loans but no credit card, adding a credit card introduces "revolving credit" to your financial profile. This diversity can demonstrate to lenders your ability to manage various types of credit responsibly.
Con: Impact on Average Age of Credit Accounts
Opening a new credit card reduces the average age of your credit accounts, which is a factor in credit score calculations. Though it's a lower-priority factor, a younger credit history can slightly affect your score.
The content on this blog is for general information purposes only, and is not intended to be personal financial advice. It does not take your individual circumstances and financial situation into account, and any reliance you place on the information is at your own risk.
