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You may have come across a “buy one, get one free” promotion at some point, but it’s not a deal that’s likely to come from your credit card issuer.
Though it’s uncommon, your bank could approve you for a new credit card and then accidentally mail you two credit cards instead of only one. Perhaps you submitted two applications instead of one due to a browser glitch and the bank processed both of them, then issued two different cards instead of the sole card you should have gotten. The account numbers will not be the same, and the lines of credit could be different too.
In such a situation, what should you do with the extra credit card? And what effect could it have on your credit score?
Increased credit availability could boost your credit score
On the credit score front, one immediate boost of an extra credit card is that your overall available credit goes up. If you own two cards and one has a $5,000 credit line and the other one a $5,300 credit line, your total available credit would be $10,300. That higher available credit helps to keep your credit utilization ratio lower.
If your issuer reports a $3,000 balance to the credit bureaus, for instance, your credit utilization would be 60 percent if you just had one card with a $5,000 limit. But with both cards and the higher overall limit, your credit utilization would dip to a considerably lower 29 percent. (Note that the FICO scoring model considers both combined available credit and credit utilization on individual cards, though the former has a greater impact.)
Considering that your credit utilization ratio accounts for as much as 30 percent of your credit score, the second card would certainly enhance your credit profile if used responsibly.
The bank could resolve the issue itself
Enhanced credit access is a plus, but you may not have the choice to keep both cards. Typically, banks don’t issue two of the same credit cards when you apply for a credit card, and have controls in place to prevent this from happening.
If you start using both cards, you could hear from the bank at some point telling you that it is canceling one of the cards.
A bank can close a credit card account at its discretion at any time without much notice. This could happen if a consumer’s credit profile has changed or if they haven’t actively used the card for a while, for instance.
The Consumer Financial Protection Bureau (CFPB) advises: “Most card issuers reserve the right to close an account at any time, and are permitted to do so under the law.”
Negotiate with the bank
If you find yourself in this situation, you should figure out early how you want to proceed. You don’t want to start putting purchases on the card only to find the rug pulled out at some point when you are counting on a bigger credit availability. Instead, it’s best to proactively reach out to your card issuer to resolve the situation.
Contact the bank, explain the situation and see what it can do for you (considering that you will typically lose one card in this situation). For one, you could ask for a bigger credit line if you get to keep only one card.
The bottom line
If you get two of the same cards from a credit card issuer after applying for a card, it is likely due to an error on the part of the bank. Even though banks have controls in place to prevent this sort of error, it can happen occasionally. Even after you receive both cards, the bank has the discretion to cancel your credit cards at any time.
Once a bank gets wind of your two-card situation it is likely to cancel one of them, leaving you in the lurch if you had counted on that enhanced credit line. You should proactively reach out to your issuer and ask for a resolution, such as an enhanced credit line on one card to maintain your available credit.
Contact me at email@example.com with your credit card-related questions.