One of the most popular types of credit cards available are those that offer instant approval. Nobody likes to wait the 4 to 6 weeks it normally takes to get your new credit card in the mail, so an instant approval credit card offers the convenience of a credit line in a fraction of the time â€“ the trouble is, how do you know exactly how instant a credit card will be?
Dictionary.com defines â€œinstantâ€ as â€œsucceeding without any interval of time; prompt; immediate.â€ With that in mind, an instant approval card is one that offers a speedy approval process; in other words, youâ€™ll know whether or not youâ€™ve succeeded in establishing a credit line with your card issuer of choice right away. In most cases it will also mean you can begin using your newfound line of credit in short order, which can mean one of a few things:
- You will be provided with your account number or credit card number as soon as your application is submitted and approved.
- Your issuing bank will give you a printable version of your card with all relevant information (such as a CVV2 number and an 800 for merchant support); this card can be used at retailers but must be phoned in for verification purposes.
- The credit card of your choice may be issued and shipped to you via priority mail or with severely reduced transit time.
- Other features and methods of utilizing your credit may be available to you by special request if you call the customer service number provided at the conclusion of your application process.
Why Does It Take So Long Otherwise?
The single longest part of the credit card issuing process is the credit check and collection of data related to you as a person. The data is analyzed by computers and financial analysts to determine whether or not a credit line is a safe investment for the credit card company. Remember, they want to make money off you in the form of interest or, at the very least, expect to be paid back in full without losing any of the money extended to you in the form of credit. Because of this, rendering a credit decision can take a while and youâ€™ll be forced to wait in the meantime.
What Makes Instant Approval Credit Cards Different?
Instant approval cards are exempt from the usual time-consuming credit review process for one of two reasons, both of which are completely dependent on your credit history:
- Your credit report identifies you as a person with good to excellent credit history, which means you have a high probability of paying your bills on time and therefore represent a low risk; or,
- Your credit report shows fair to poor credit history, meaning you represent a high risk to the issuing bank since you may not be able to make your payments on time.
For people with good/excellent credit, your rating and history have established you as a client with little to no risk. Allowing you to receive a relatively generous credit line and granting you immediate access to that line is in the best interest of a credit card issuer since they would like to keep your business. Issuers will usually throw in low interest rates and reward programs as well to ensure that you stick with them, so your need for an instant approval credit card translates to a great business opportunity in the eyes of a credit card bank.
For people with fair/poor credit, your rating and history have identified you as a potential risk to the credit card company. This doesnâ€™t necessarily discount you from getting an instant credit line, though it will mean that you have to pay a price to the credit company in order for the relationship to be worth their while. This will usually take the form of higher interest rates or steep annual fees, so if you have less than perfect credit but you need to get a credit card make sure you know what youâ€™re getting into ahead of time by reading the terms and conditions first.
For people with average credit, it would be worth your while to wait the additional time and pursue a card via conventional means which means enduring the usual waiting period. Since instant credit products pander to the extremes of the credit scale (very good credit or very bad credit) a person with average credit would likely be denied the offers for excellent credit, nor would it be worth it to get a bad credit instant approval card since the fees are on the high side.
A complete listing of credit cards that meet our instant approval criteria is available on our instant approval credit cards page.
Additional instant approval credit card resources: