Con: Application Impact on Credit Score
When you apply for a credit card, the issuer checks your credit history, known as a "hard pull." This can slightly reduce your score temporarily, regardless of whether you're approved. While your score will recover in under a year, the hard pull remains on your report for about two years.
Pro: Diversifying Your Credit Portfolio
If you have loans but no credit card, adding a credit card introduces "revolving credit" to your financial profile. This diversity can demonstrate to lenders your ability to manage various types of credit responsibly.
Con: Impact on Average Age of Credit Accounts
Opening a new credit card reduces the average age of your credit accounts, which is a factor in credit score calculations. Though it's a lower-priority factor, a younger credit history can slightly affect your score.