Online credit card applications can result in an e-mail telling you that you are ‘conditionally approved’ following the confirmation that your application has been received. This is a term that is confusing and has led many people to ask us ‘what does conditionally approved mean? To put it simply, conditionally approved is a term that the bank uses to explain that it needs to further verify the information in your application before it will tell you you are approved and send you your credit card. It is also one of the ways all banks are able to market instant approval credit cards and promise fast responses to applications. Often you will find a statement on the bank’s website somewhere that reads like this:
“conditional approval is subject to system availability and verification of documents that support your application.” Or“All applications are subject to —‘s credit assessment criteria.” Or“If your application is approved, it is then subject to verification. If the verification criteria is satisfied, you will receive your credit card within 5 business days.”
Following the simple steps below should help you avoid unnecessary delays or rejections once your card has been ‘conditionally approved’.
Instant or ’60 Second’ conditional approval
ANZ First 6 Credit Card
Great as a first credit card low annual fee and low minimum income required. 0% on purchases and balance transfers for the first 6 months.
Often credit cards offering ‘instant approval’ where a response is promised within 60 seconds will still only be giving conditional approval, because the bank has to manually verify your income, employment details and do its usual credit checks to make sure that what a computer has decided you are approved for is what you would really be approved for. With the internet and computer technology so advanced, banks have computers that can automatically access credit bureau information and match it against key lending criteria. This is the part that only takes 60 seconds. After that, though, someone does have to make sure that what’s been said in the application is backed up by documents provided by you and verified independently. That’s the reason behind the disclaimer above, where systems have to be operating and they have to be able to get hold of all your details and verify them (for their own internal purposes).
Get the details right and keep your credit rating intact
The idea of being approved so fast can be tempting, but it’s still important not to act impulsively when applying for a credit card. If you haven’t done a credit check recently, at least within the last few months, Veda offer them for free within10 days or sooner if you’re willing to pay.
When you know what’s on your credit file there is less of a chance that you will leave important existing debt information out, which could result in a declined application going on your credit file.
Knowing that your credit file is accurate and reflects your real debts and obligations also helps you feel confident the bank won’t discover any nasty surprises.
Fill out the application accurately and complete every section.
If you have a $25 000 loan sitting on your credit file and don’t mention it on the application, don’t think that the bank won’t find out.
Have all your details to hand when you sit down to do it.
If you’re searching for your bank statements and drivers’ licence you will not be concentrating on your application, so it’s best to read through the checklist next to the card you want to apply for, and the terms and conditions, and then get the necessary documents and info together. This way you won’t miss any vital information and the process will really only take 10-15 minutes max.
Check that what you are asking for meets all available criteria.
For example, if you want to transfer a balance of $5000 and ask for a credit limit of exactly $5000, you might be declined (or spend extra time dealing with the bank on the phone at the very least) because you are generally allowed to transfer between 70% and 95% of the total credit limit you are approved for. In this case, you would either need to request a slightly higher credit limit, say around $5500, or put down that you only wish to transfer $4750 or less onto the new card. This is one simple error which results in an application being delayed or declined that is easily avoided.