8 Questions to Ask Yourself Before Applying for a Credit Card

Whether you’re applying for your first credit card or contemplating adding another to your wallet, there are several things that you should consider before starting your search.
thimbl shares 8 questions you should ask yourself before you apply for a credit card.

1. Why am I applying for a credit card?

Applying for a credit card needs serious consideration and research, and is not something that should be taken lightly.

Whether you’re thinking of applying for a first credit card to boost your credit score or an additional credit card offering a balance transfer to help you save money on interest, you should be very clear on your reason for applying. You should also carefully consider any other options that could be available to you. There are credit card alternatives that may be better suited to your circumstances.

2. Have I explored credit card alternatives?

A credit card isn’t always the best option for everyone.
We’ve detailed some credit card alternatives below, which we hope you find useful.

• A personal loan
  Faced with a financial emergency? Whether it’s a broken boiler or a car that’s failed its MOT, a personal loan could help to cover the cost if your immediate funds or savings can’t quite reach. If approved, the money will be sent to your bank account. You’ll then repay the loan in monthly instalments, including interest, over a pre-agreed term.


• Borrow money from a loved one
  If you need money to cover an emergency expense but are reluctant to apply for credit, it may be worth considering whether you could borrow money from a friend or family member instead.
  Before you enter into a financial arrangement with a loved one, it’s vital to put an agreement in place. It’s a good idea to get this in writing.


• Save up
  Taking a step back to save up the money you need rather than applying for credit might not be feasible in every situation. However, if you do have the capacity to do this, it will save you money in the long run. Using your own funds instead of applying for credit will mean that you won’t need to pay interest.

3. Can I afford to make my monthly repayments?

This is a hugely important question to ask when considering whether to apply for a credit card.
When it comes to credit, whether that’s a loan, credit card, or even a Buy Now Pay Later (BNPL) service, the golden rule is simple: never apply for money that you don’t need to, or cannot afford to repay.
If you do decide to apply for a credit card and your application is approved, the same rules apply.

4. Do I understand how my credit score could affect the credit cards that could be available to me, as well as the Annual Percentage Rate (APR) I could be offered?

If you have bad, limited, or no credit history, your credit card options could be limited, and you could be offered a higher APR.
Some credit cards, such as the credit builder credit card, have been designed for people with poor and limited credit history, and providers of this type of credit card could be willing to consider your application.

5. Do I understand how a credit card could affect my credit score?

There are many ways that a credit card could affect your credit score. Whether these effects have a positive or negative impact will be down to how your credit card is managed.

How to look after your credit score when you have a credit card

• Try to keep your credit applications to a minimum.
  Every time you apply for credit, the provider will carry out a creditworthiness assessment, which could include a hard search. Multiple hard searches in a short space of time could harm your credit score.


• Make your repayments on time each month.
  Consistent responsible spending and repayment habits could positively influence your credit score, while a late or missed repayment could have the opposite effect.


• Avoid using your credit card to withdraw money from a cash machine.
  This is known as a cash advance, and could signal poor money management, which in turn could result in a drop in your credit score.


• Stay within your credit limit.


• Aim to keep your credit utilisation as low as you can.
  If you’re hoping to improve your credit score, you should try to keep your utilisation below 30%. We’ll explain more about credit card utilisation further down the page.

6. Do I understand my credit limit?

Your credit limit is the total amount of money you’re able to borrow on your credit card.
A credit limit should never be seen as an incentive to spend money that you don’t need to or can’t afford to repay.
As discussed above, it’s important to stay well within your credit limit; attempting to spend outside of it could result in your transaction being declined and a drop in your credit score. Depending on your provider, you may be charged a fee.

7. Do I understand credit card utilisation?

If you already have a credit card and are looking to add another to your wallet, please be aware that your overall utilisation will be spread across all your credit cards.
We’ve included an example below:

• You have a credit card with a credit limit of £500. You’re currently using £125 of this limit, which means your utilisation for this credit card is 25%.


• You’re approved for another credit card with a credit limit of £1,000. You use your new credit card to make a £50 purchase. Your utilisation on this credit card is 5%.


• Combined, you have an overall credit limit of £1,500, of which you are using £175. This equates to a total credit card utilisation of 11.67%.

8. Have I researched different types of credit cards?

Credit cards are not ‘one size fits all’. They come with an array of features and perks to suit various financial goals.

• Credit builder credit card
  If you have limited or poor credit history, a credit builder credit card could help you move towards a healthier credit position.
  This type of credit card typically comes with a manageable starting credit limit to help with responsible spending. Your spending and repayment activity will be reported to the credit reference agencies (CRAs), and if you make at least the minimum repayment amount on time each month, you could notice an improvement in your credit position over time.


• Balance transfer credit card
  Working on clearing the balance of one or more credit cards?
  Transfer the balance of one or more existing credit card(s) onto a balance transfer credit card, and pay no interest for a certain amount of time, for example, 3 months.
  Please be aware that any balance remaining on your credit card once the interest-free promotional period ends will be charged interest at the credit card’s standard rate.


• 0% purchase credit card
  If you’d like to spread the cost of a large purchase, this type of credit card could be an option. A 0% purchase credit card offers interest-free spending for a certain amount of time, for example, six months. As is the case with a balance transfer credit card, any balance leftover on a 0% purchase credit card after the promotional period ends will begin to accrue interest at the credit card’s standard purchase rate.


• Rewards credit card
  If you’re an experienced and confident credit card user and always make your repayments on time, you might wonder whether you could get something back for your positive activity. A rewards credit card could do exactly that: reward responsible credit card use. The rewards available to you will vary between providers and could include airmiles or store points.
  You’ll need to be disciplined with a rewards credit card: possible rewards shouldn’t be an incentive to spend money when you don’t need to or use credit that you can’t afford to repay.

The thimbl Credit Builder Credit Card at a glance

• Personalised, manageable starting credit limit between £200 and £2,000.
• Use your thimbl Credit Builder Credit Card to make an essential and affordable purchase.
• Make at least the minimum repayment amount each month. Where possible, try to make more than the minimum amount.
• Your activity will be reported to the credit reference agencies. If your credit card is managed responsibly and used alongside other credit-building methods, such as paying bills on time and registering to vote, you could see an increase in your credit position.

The thimbl Balance Transfer Credit Card at a glance

The thimbl Balance Transfer Credit Card

• 6-month interest-free on balance transfers.
• Initial transfer fee of £3 or 3% of the balance, whichever is greater.
• Please be aware that the interest-free period does not apply to any purchases made with your credit card.
• Any balance outstanding once the promotional period ends will be charged interest at your standard rate.

You can check your eligibility for the thimbl Balance Transfer Credit Card here.

Could I search for a credit card with thimbl?

You can check your eligibility for a thimbl credit card if you:

• Are between the ages of 18 and 70;
• Are a UK resident with at least 1 year's UK address history;
• Have a monthly net income of at least £800;
• Have an active credit account that has been open for a minimum of 12 months; and
• Do not already hold a Zable credit card.

thimbl is a credit broker. The thimbl credit card is powered by Zable, a trading name of Lendable Ltd.
Lendable Ltd is unable to consider applications from anyone who has declared bankruptcy or is in an Individual Voluntary Arrangement (IVA).

Can’t make your credit card repayments?

If you have a credit card and can no longer afford to make your monthly repayments, you should contact your provider as soon as you can.

Struggling with your finances? Worried about debt?
Please consider reaching out to one of the following organisations for free, confidential, impartial support: StepChange, MoneyHelper, Citizens Advice, and National Debtline.