Can Your Mortgage Positively Affect Credit Card Applications?

November 10, 2011

credit cardsHave you applied for a new credit card recently? While we all know that several factors may affect your chances of being approved, one factor you may not be aware of involves mortgages.

According to an article by Janet Dedrick on the Equifax Finance Blog, people with mortgages are statistically better risks for credit card companies. In “

Credit Trends: Mortgages and New Credit Cards,” she explains how consumers with mortgages are seen as overall lower risks. Dedrick also reveals several other surprising

credit trends for 2011.

  • 42 percent of new credit cards have been issued to people with mortgages
  • 60 percent of new credit has gone to consumers with mortgages
  • Roughly half of the new credit card consumers with a mortgage have property values estimated at or below $200,000
  • 35 percent of these consumers own a home worth between $100,000 and $200,000

One interesting thing to note is that 35 percent of the aforementioned mortgage holders are also underwater on their mortgages. Even more surprising is that 30 percent of new credit card holders with credit scores above 700 are also underwater. Despite these factors, Dedrick points out that these mortgage holders are still consumers in the credit world.

A majority of new credit card consumers have equity in their homes. Home value and home equity are both important factors because people with equity are better able to withstand financial hardships such as unemployment or unexpected medial costs.

People are beginning to spend more, and credit card companies are starting to offer more cards.

If you’ve applied for a credit card recently? What was your experience?

Categories: Economy, Mortgages

About The Author

Read All Stories By Mitch Levinson

Mitch Levinson is the author of “Internet Marketing: The Key to Increased New Home Sales” published by BuilderBooks. He is an Internet marketing expert with expertise in search engine optimization, website development, email marketing, social media and CRM consulting services. He is known for creating effective programs that can be tracked through analytics to prove effectiveness and ROI. Mitch is founder and president of MLC New Home Marketing and MLC FlatFee Realty, as well as managing partner of mRELEVANCE, LLC, a Marketing, Communication, Interactive agency with offices in Chicago and Atlanta. He currently leads the Chicago team. A Multi-Million Dollar Sales Producer who earned an MBA in Computer Information Systems and eCommerce, he brings a unique perspective and experience to the field of real estate communications. Mitch combines the two interests in order to help home builders and developers gain a competitive advantage through the Internet and technology. When he isn’t behind a computer, he enjoys participating in sports and coaching his kids’ teams. Mitch resides in Arlington Heights, Ill., a northwest suburb of Chicago, with his family, which includes two rambunctious labs. Visit my Google+ profile.

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