Looking for a better credit card offer? From upgrading with the same bank to applying with a new offer, here’s everything you need to know before you upgrade your credit card.
If you’re upgrading your credit card, you have two main choices to choose from. You can either upgrade to a different product from your current issuer or you can consider moving to a different provider. So whether you’re looking to balance transfer to a card with a different bank or upgrade to a higher tier product with the same provider, you can use this guide to compare your options and find out all you need to know to upgrade your credit card.
Upgrading your credit card with the same bank
If you want to upgrade your card but would like to stay with the same provider, you could either request a credit limit increase on your existing card or request to upgrade to a different product.
From time to time, you might get invitations to upgrade your credit card or increase your credit limit from your bank. Usually, these offers appear if you’ve shown healthy lending habits and your financial institution is willing to lend you more money. Otherwise, if you haven’t received an enquiry but would like to upgrade your card anyway, you can get in touch with your provider to request an upgrade.
What to consider before you make an upgrade with your bank
- If you’ve been offered a new card, you might find the upgrade comes with a higher annual fee, interest rates, credit limit and more value-adding features such as rewards programs. While this might sound appealing, you should only upgrade your card if you know you can afford the new card. If the value of the extra features (such as rewards, the concierge service and complimentary insurance) doesn’t outweigh the cost of the annual fee and interest rates, you might want to reconsider. Plus, while a higher credit limit might offer more spending power, it could also tempt you to make unnecessary purchases that you can’t afford to repay without collecting interest.
- Also, if your bank is offering a special introductory deal such as 0% on purchases, an interest-free balance transfer period or bonus rewards points, remember that these features are usually only available to new customers, not existing ones.
- If you do decide that you’d like to upgrade under the existing bank, you can get in touch with your provider directly to discuss your options.
Getting a credit card with a new bank
If you want to take advantage of a promotional offer, such as a 0% balance transfer deal, interest-free purchases or bonus frequent flyer points, you’ll need to upgrade your card with another bank. If you’re still carrying a balance, you’ll need to conduct a balance transfer to move your debt from your existing account.
What to consider before getting a credit card with a new bank
If you do need to conduct a balance transfer to a credit card with a different bank, you would benefit from taking advantage of a 0% balance transfer offer. Balance transfer promotions can last from 6 to 20 months, so you’ll need to compare the length of the offer to make sure you can pay off your entire debt before the offer ends and the standard balance transfer rate applies. You’ll also need to make sure you’re eligible to transfer your existing debt to the new card as you can’t balance transfer between some banks and some balance transfer limits may apply. If there is a low or 0% purchase rate offer in place, you’ll also need to check what the promotional rate is, how long it’s in place for and what the revert rate is before you apply.
If you’re looking to upgrade to a different card because of a bonus points offer, you might need to make an eligible purchase within a specific time period to receive the points, so make sure this complements your spending plans before you sign up.
As well as promotional offers and special deals, make sure you compare the standard costs and features of the card before you apply for a card with a new bank. Features such as minimum income requirements and eligibility criteria, interest rates, annual fees and extras such as rewards programs, complimentary insurances and contactless payment capability should all be considered before you apply. There are plenty of competitive offers on the market, but comparing your options beforehand will ensure that you’re moving to a card that offers more value than your previous account.
How to apply for a credit card with a new issuer
- After you’ve compared your options and ensured you met the eligibility requirements (including age, minimum income, good credit history and residential status), you’ll need to organise the necessary documents to improve your chances of approval. You can either apply in a branch, online or over the phone.
- If you’re applying for a balance transfer, you’ll need to provide the details of the account you’re transferring, including the debt amount, before you apply. If you apply online, you should receive a response within 60 seconds of submitting your application. If approved, you’ll receive your card within a couple of weeks.
If you do conduct a balance transfer or switch to a credit card with a new provider, remember that it’s your responsibility to close your old account if you wish.
- You can compare credit cards by features such as the minimum income requirement, rates of interest, fees and credit card extras. Value-adding features like rewards come at the cost of the credit card annual fee.
- After you compare credit cards, read our review and application pages for an analysis of the product you have in mind. You can start an online application by clicking through to the credit card issuer’s website. If you’re transferring a balance, you can enter your credit card details when prompted during the online application. You will receive a response from the financial institution right after submitting your application. If approved, you will have your card within a couple of weeks.
Things to be aware of before changing your credit card
Think about features, price, access to promotional offers and eligibility before you upgrade your credit card.
- Are you eligible? Before you apply for a new card, whether it’s with your bank or another provider, make sure you meet the eligibility requirements including the minimum annual income, the age restriction and the residential status requirement. You’ll also need to have a healthy credit history to apply for a new product.
- Do you have debt? Unless you want to move the debt to a different credit card with a different financial institution using a balance transfer, you should pay down as much of your credit card debt as possible before applying for a new card. If you have a high level of debt, this might reduce your chances of approval when the bank is assessing your ability to repay.
- How will this impact your credit score? Every application for credit is recorded on your credit file. You need to have a history of managing credit to maintain a healthy credit file; however, too many applications for credit in a short space of time is a red flag for creditors.
- What are the costs? If you’re upgrading to a rewards credit card from a low rate credit card, or something similar, make sure the value-adding features are worth the extra cost. The price of complimentary travel and purchase insurance is included in the product’s annual fee. Be sure you’re going to use the features on offer to get the most value from your new credit card.
- Will you close your old account? If you’re upgrading to a credit card with a different issuer, make sure you decide whether you want to close the account after you’ve made the switch. If you have debt remaining on the card, you’ll have no choice but to keep it open until you’ve paid it off. If you’ve conducted a balance transfer or paid your debt off, you’ll need to close your account if you wish to avoid the maintenance costs of keeping it open.
There is a lot you need to think about before upgrading your credit card. Doing your research and comparing your options beforehand will help you make the right choice and ensure that you’re getting more value from your new card.
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