How Visa Bulletin Works

By Tiara

The second way to get denied while applying for credit is when they check your credit report and find lots of derogatory information. This can include bankruptcy, foreclosure, collection accounts, and more.

A hard inquiry into your credit file happens when an organization such as VISA checks your credit reports to see if you are eligible for credit.

A soft credit inquiry happens when an organization only looks at one piece of your credit profile, not all three, but it counts towards your total credit score.

Here’s what you should know about these inquiries and why having too many can hurt your credit. In this article, we will talk about visa bulletin applications, how they work, and some potential signs that yours was declined.

Reminder: It's totally normal to be curious about whether or not someone has applied for loan or credit cards before! Having low credit can make it difficult to obtain credit in the future, so doing due diligence is important.

This article will help you understand how lenders decide who gets approved and what factors play a part in their decision.

Expiry dates of credit cards

how visa bulletin works

Credit card companies determine when an individual’s account can be used by looking at two things: how well you pay your bills and what kind of credit you have. If you are consistently paying your bills on time, then they will waive your expired credit card so that you do not need it to make monthly payments.

If you have good credit though, you may get given another credit card with lower limits! This is because most lenders believe you will keep up payment commitments even if you have less money to spend.

You cannot apply for a new credit card within six months of when yours expires, however. That is why it is important to stay in debt-free mode for this period. You can use our tips here on how to stay debt free to help you through this.

Limits for credit card categories

how visa bulletin works

Recent changes to visa bulletin guidelines limit which credit cards people can apply for or re-qualify for. These restrictions typically go into effect once someone within the last six months has been rejected due to low income.

The latest rule change was announced in June 2018, when it became illegal to accept applications from individuals with less than $1,000 per month in available monthly income. This is known as having “limited income”.

Before this new guideline, there was no hard and fast dollar amount that determined if an individual qualified for a certain credit card. Some sources say that lenders would look at three years of income while others say two years.

Either way, what these criteria have in common is that they all assume that you will spend the money you earn on daily living expenses like food, rent, and transportation.

Understanding credit limits

how visa bulletin works

When you carry too much debt, it can put stress on your finances and make paying off your loans more difficult. It can also hurt your overall rating when lenders review your personal financial information.

By having high credit card limit amounts, people who have bad credit or no credit at all may feel pressured to take out additional cards to earn enough money to pay off their current accounts.

This is not a good way to rebuild your credit score or get rid of hard-to-pay debts. In fact, many banks will lower your credit line just because you had trouble making payments before!

Another reason that people with low income levels start using credit is due to lack of understanding how credit works. For example, most people believe that being given a large credit line means they have more access to spending money, when in reality it only helps them spend even more!

There are ways to use credit efficiently, but for someone with very little money, this can be tricky. Luckily, we can help you manage your credit.

Borrowing more than you should

how visa bulletin works

It is very common for people to assume that because they can easily access their money, therefore it is okay to spend more money than what they have.

It is totally normal to feel stressed out or even depressed when you are struggling with your finances. Credit card debt can make such feelings worse.

However, it’s important to remember that credit cards were meant to create easy access to credit, not the other way around. Using a credit card responsibly means being conscious of how much you owe at all times.

If you find yourself in a situation where you understand that you will soon run out of money, then consider whether it's time to lower your spending.

By lowering your budget temporarily, you can get through this difficult period. Plus, there are many ways to reduce your monthly expenses so you don't need to use a credit card for essential things.

Paying with credit cards

how visa bulletin works

Another way to use your VISA card is to add money to your account. This is called paying with credit cards. You can do this in two ways: balance transfer or cash withdrawal.

A balance transfer means moving all of your current debt into another brand name credit card that offers lower interest rates. Then, you pay off the new credit card using income from your monthly savings, house payment, etc.

This is typically done at an equal amount each month for both spending habits. For example, if you spend $1,000 per week online then move that to a low-interest rate VISA card, we would need to make a weekly budget of $750 to maintain our spending habit!

By having more than one source of income, it creates consistency in saving and keeping track of how much money you have left over every day.

Many people find it helpful to use a computer software app to keep track of their finances.

Reviewing your credit report

how visa bulletin works

It is your responsibility to check your own credit reports, not just once but annually!

That means getting all three free copies you are entitled to every year by law. You can access your Equifax credit file at www.equifax.com/creditreportand Your TransUnion credit file at https://www.transunion.com/brs/index.cfm?fuseaction=7&UserID=700 and Your Experian credit file at https://experiencenow.com/b2c/.

You should also keep an eye out for changes to accounts that affect your credit score. For example, if you find a new account or a change in how much money is in it, make sure to update your credit profile.

It’s important to do this because lower scores mean higher interest rates and fees when you apply for loans or cards.

Loan applications

how visa bulletin works

When a bank receives word that you have been approved for a loan, they will send you an application asking you to confirm some basic information about your life (names, addresses, phone numbers, etc.). Then, they will include questions about how you plan to use the money, what type of credit you have now, and if you can list any additional sources of income.

These applications are called “loan applicatons” or “lender surveys” because they are used by lenders to gather more detailed information about you as a borrower.

After getting all this information, the lender will review your files and determine whether or not to approve you for the loan!

This is the part where most people get nervous. You expected it would be hard to get approved for a loan, but you never thought it would come down to just looking at your banking records and personal documents.

A large part of the reason people get turned off from loans is due to fear of being rejected. This is totally normal and understandable.

But there is another way to look at it. Rejection isn’t always bad! In fact, it can even help you out in the long run.

Applying for credit cards

how visa bulletin works

When you apply for credit, there’s an initial verification process to make sure that you are who you say you are. This is done by verifying your identity and confirming your employment.

Next, lenders review your recent credit activity to determine if you can afford to pay for the things you want to buy. If they believe that you cannot, then most likely you will not be approved for a loan!

This is why it is so important to monitor your debt load and prove it to creditors that you can repay your loans.

If you find yourself in financial trouble, don’t run away from your problems. Take time out to work through all of your finances and see where you can cut back.

Don’t put more money towards your debts than what you have paid off already unless you plan to stay within your current budget.

Bank accounts get locked after a certain number of withdrawals, which is why it is very common to overspend during times when people feel stressed. Make changes to avoid this by only withdrawing how much you need.

We hope you learned something about visa bulletin here and how it works. If you ever needed help with personal finance, try looking into credit counseling or other alternatives before asking for a loan.