My nephew in college tipped me off about this problem.  He had just turned 21 and wanted to get a credit card after having a bevy of credit card offers thrown at him.  He just assumed that since he was receiving an offer that he would be accepted.  Au contraire!

This US News and World Report article highlights the reasons that credit card applications may be rejected:

1. Credit score is too low.  Common problem for young borrowers with limited credit history.
2. Your income may be too low.
3. You applied for the same card recently.
4. You’re unemployed.
5. You have never had a card before.  The article points out some solutions that might be helpful for students looking for alternatives:

You have a few options. You could try to recruit a loved one with good credit to serve as a cosigner. Cosigners essentially backstop your credit card play; if for some reason you miss your payments, the cosigner is responsible for making good on the debt. This puts many issuers at ease, because they know that someone with a good credit history is on the hook for paying the bill if you don’t.

Another idea is to get started with a secured credit card. This will require you to put down a deposit, which, as the name implies, guarantees the bill is paid. But otherwise, secured credit cards function exactly like their unsecured counterparts. By using this card consistently and responsibly, you’ll build a solid credit history. In fact, you should be able to upgrade to a regular card within a year or so.

About the Author

Tim Ranzetta

Tim's saving habits started at seven when a neighbor with a broken hip gave him a dog walking job. Her recovery, which took almost a year, resulted in Tim getting to know the bank tellers quite well (and accumulating a savings account balance of over $300!). His recent entrepreneurial adventures have included driving a shredding truck, analyzing executive compensation packages for Fortune 500 companies and helping families make better college financing decisions. After volunteering in 2010 to create and teach a personal finance program at Eastside College Prep in East Palo Alto, Tim saw firsthand the impact of an engaging and activity-based curriculum, which inspired him to start a new non-profit, Next Gen Personal Finance.