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Credit score or income: Which one matters more when applying for a credit card? A FICO expert answers

If you're planning to open a new credit card, here's how both your credit score and income play a part in the process.

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Select’s editorial team works independently to review financial products and write articles we think our readers will find useful. We may receive a commission when you click on links for products from our affiliate partners.

Whether you are applying for your first or your fifth credit card, having a good credit score — something in the range of 661 to 780 — opens up doors to qualify for the best rewards and cash back on all your purchases. During the approval process, a healthy score can also help you receive the best terms and conditions, such as a low variable interest rate and a higher credit limit.

But where does your income stack up in comparison when you apply for a new credit card? CNBC Select asked Ethan Dornhelm, VP of scores and predictive analytics at FICO, which matters most: your credit score or your income?

"While every lender has their own approach to making lending decisions, credit data — often represented by the FICO score — is likely to be a bigger driver of the approval decision," Dornhelm says. But he notes that your income still has a pivotal part in the approval process.

Why your income still matters when applying for a credit card

"Income — and in particular, your income in relation to your debts — plays an important role when lenders decide your credit limit," Dornhelm says.

Because your salary shows how much you make, and your debts show how much you owe, the two factors combined give lenders an idea of your capacity to repay what you borrow. Lenders then look at these factors to decide just how much credit to extend to you. A borrower with a lower income threshold and a lot of debt will most likely receive a much smaller credit limit than someone with a higher income and less debt.

Credit limits vary by cardholders, but the upside is that once you start building credit, you will have a better chance of getting more extended to you. Those borrowers with an already-good mix of credit products (such as a mortgage, auto loans or student loans), also have a greater likelihood of receiving a higher credit limit on their first credit card versus someone completely new to credit.

How to monitor your credit score

Since both your credit score and your income play a part in obtaining new credit cards, it's important to monitor both.

While it's easy to track your income (you know how much your salary is and can watch your paychecks get directly deposited into your checking account), track something like your credit score may seem like more work.

It doesn't have to be, however. To keep an eye on your credit score, sign up for a monitoring service that automatically notifies you of changes made to your credit report.

If you don't want to pay out of pocket for the service, CNBC Select ranked our top picks and two free ones include CreditWise® from Capital One, which comes with a credit score simulator, and Experian free credit monitoring.

CreditWise® from Capital One

Information about CreditWise has been collected independently by CNBC and has not been reviewed or provided by the company prior to publication.
  • Cost

    Free

  • Credit bureaus monitored

    TransUnion and Experian

  • Credit scoring model used

    VantageScore

  • Dark web scan

    Yes

  • Identity insurance

    No

Terms apply.

Experian Dark Web Scan + Credit Monitoring

On Experian's secure site
  • Cost

    Free

  • Credit bureaus monitored

    Experian

  • Credit scoring model used

    FICO®

  • Dark web scan

    Yes, one-time only

  • Identity insurance

    No

Terms apply.

Editorial Note: Opinions, analyses, reviews or recommendations expressed in this article are those of the Select editorial staff’s alone, and have not been reviewed, approved or otherwise endorsed by any third party.