It’s because of how credit scores work.
According to myFICO.com, “new credit” accounts for 85 out of 850 possible credit scoring points, with new credit defined by such traits as:
These traits are negatives against a FICO score so with each new, in-store credit card application, a person’s credit score will fall. The fall will be especially pronounced for persons lacking credit “depth”, or who have made a disproportionately large number of new credit applications recently.
For soon-to-be homeowners, or would-be refinancers in Omaha , credit scores are worth keeping high. This is because credit scores change the mortgage rates and/or loan fees for which an applicant is eligible.
As an illustration, assuming 20% equity on a $200,000 conforming loan:
It’s expensive to have a low credit score — more expensive than the money saved by opening a card at the mall, anyway.
That said, if you know you won’t need your credit for a mortgage within the next 6 months, the risk of applying for in-store credit cards is likely small. But if you’ll need your FICO soon, consider paying for your gifts full price.