How are credit cards assessed?

I currently have a St George Amplify credit card with a $3k limit, though as I have a package and I don't pay an annual card fee, I thought I might as well get an Amplify Signature card.

Though if you've read my other thread in this sub-forum, you'll see that money is a little bit tight. I would still pay the credit card off in full and I wouldn't max it out, so really my actual situation wouldn't change (other than the fringe benefits that the new card would bring, such as insurance).
However, I wouldn't want to get rejected as I assume it would show up on my credit report.

So, can I go for it, or am I likely to get knocked back and should just pay for travel insurance separately?

 

One thing to note is that the minimum credit for this new card is $15k...

 

I know, hence me wanting to know how it's assessed. If it's the same as a mortgage I won't qualify.

 

Last time I heard its based on the minimum payment due on the card on a full credit limit basis, circa 3%.Eg on a $10k card, it removes $300pm of servicing

 

I've been told that they assess the maxed out balance on the card 5 times over.
So $5,000 card limit, will reduce capacity by $25k

 

Generally true, but there are some lenders that use 2.5%. I can't remember which.

A bit of an exaggeration. In practical terms, depending on the lender's policies, it's usually somewhere between 3 to 4 times the limit.

 

So basically, if I don't qualify for a mortgage currently (which I don't think I do), I won't qualify for the credit card, so I'm likely to get knocked back?

 

I applied for a CommBank low rate recently because they had a $300 cash back offer... I thought awesome, free $300!

Applied, got declined

 

Normally, I would say this is good advice, given my circumstances at the moment, I don't want to buy in the next three years or so anyway. And once I want to buy again, any credit card can just get cancelled.

 

CommBank have introduced a new remote brain scanning technology which is now used as part of their credit assessments. It works via your webcam or their branch security cameras. As you say, you're actually using your brain for thinking, which they automatically associate with increased risk. Hence the credit scoring mechanisms declined your application.

The solution is to wait a 3 months for your credit rating to settle down, then as you reapply, focus on food, shopping or sex. These are much more aligned with approved use of credit cards.