I applied for my first credit card, but i was denied! Why is this?
Posted in Credit on 11/22/2009 11:43 am by admin
I’m a twenty year-old college student who applied at Chase Bank for my first credit card, along with opening a free checking account, last week. My card was supposed to come in the mail, but instead I got a letter that said this:
“After reviewing the information provided in your application and your credit bureau report, we regret that we are unable to approve your request for a credit account at this time. The reason(s) for our decision are as follows:
Few revolving accounts opened long enough to establish credit history
Not enough accounts opened long enough to establish a credit history
Our credit decision was based in whole or in part on information obtained in a report from the consumer reporting agency listed below. The reporting agency did not make the credit decision and is unable to provide you with the specific reasons for our decision.”
What on earth did I do wrong?!
How can I have bad credit when I’ve never even applied for a credit card in my life?!
GERRY
11/25/2009 at 12:20 pm
ERROL
Bad credit.
11/25/2009 at 11:56 pm
BOBBIE
I’m am no expert when it comes to these kinds of questions.
But, what it says on the reason part is, its saying “unable to provide you with the reasons for our decision”.
That is saying they can’t give you the reason why. So, its a mystery. Try re-applying.
11/27/2009 at 6:15 pm
DAMIAN
you didn’t do anything wrong..you just haven’t had a credit history long enough for the card company to gauge whether or not you’d be a “risk” or not.
11/29/2009 at 10:08 pm
PABLO
I suggest you get a student credit card. They are much better at giving you a card so you can build more credit history. Citi cards has some that you can earn points with and redeem those for gift cards and merchandise.
11/30/2009 at 2:55 am
JODY
No credit history has the same affect as bad credit history.
It sounds crazy I know, no sane person thinks it makes any sense but that’s simply the way the system works.
To ***** your credit score they have to have past credit activity to look at…if you’ve never had any credit then you won’t have that past history.
You could be a millionaire but if you had no credit history you would still be refused, they wouldn’t know you had millions in the bank…just that they couldn’t find any credit history to look at.
I moved to England a few years ago from the US, I built up a credit rating here but didn’t do anything back home…when I visited I always used my UK based credit cards.
Earlier this year on a trip back home I also applied for a credit card and was turned down….for the same reason.
I no longer had any current credit history in the US that they could look at.
That I had money in the bank and credit cards from the UK made no difference…..I hadn’t done anything in the US for about 6 years and that was all they looked at.
I got around it by getting a secured credit card from Wells Fargo….that’s a card where you deposit an amount in an account to cover any charges you make on the card…so they know they are covered if you default.
You still have to pay the charges off each month though…that’s what they want to see you doing.
Give it a year of using the card without any problems and they will then have a credit history to look at and I will then change it to a standard card.
In short, I have to create a credit history for myself in the US from scratch.
You may need to do the same.
11/30/2009 at 3:19 pm
KENNITH
You don’t have bad credit it’s due to lack of credit. You didn’t do anything wrong. So no need to worry about that part. However you have to get started somewhere with credit. There’s a few different options that you can try it’s up to you as to which route you go. But go through investigate and choose the option that’s best for you. Don’t apply for a bunch of cards all at once because that will actually negatively impact you and make your situation worse. You have 3 options,
1) you can get a student credit card. They’re easier to obtain because it’s expected that a student just starting out will not only have no credit history but will also have lower income. so in their decision making they take both of those into account. Things you need to be careful of with this card is the APR (annual percentage rate) and annual fees. You can expect the interest rate to be higher because the bank sees you as a bigger risk because they have no clue as to how responsible you’ll be in making your payments. Annual fees are also typical on student cards although you can find places that offer student cards without annual fees.
2) you can choose to apply for a department store card. couple downfalls to this idea is a) you can only use the card in that particular department store which doesn’t work well for emergencies b) the APR is ridiculously high usually. If you do decide to go with a department store card make sure and ask them if they report to the credit bureaus, because that’s how you’re going to gain credit history. Most department stores do report but every great once in a while you’ll come across one who doesn’t.
3) you can apply for a secured credit card. these are actually pretty easy to obtain as long as you have a steady job. The biggest down falls of these cards are the security deposit, the APR and the annual fees. Basically with a secured credit card you have to make a security deposit for the amount that you want your credit limit to be. ie if you want a 100 dollar credit limit you have to give them 100 dollars. However if after 6months to a year (varies depending on the card) you’ve made all your payments on time for at least the minimum and you haven’t gone over your credit limit the company will change the card into a regular credit card and give you back your security deposit. Again with these you need to ask if the company reports to the credit bureaus. Most of them do..but some of the smaller lesser known banks won’t which again would defeat the purpose.
In your case given that you’re a student I would suggest a student card as your best option considering that they take into account your lower income. And with any of the choices I will always recommend to pay off your balance in full every month by the payment due date. If you can’t afford to pay for the item you put on a credit card outright then you just didn’t really need the item to start with.
12/03/2009 at 5:41 pm
SEAN
Your credit score is:
35% Payment history
30% Amounts owed
15% Length of Credit history
10% New Credit
10% Credit Mix.
As they did not indicate you had issues with the top 2, try someone else. The banks are getting more stringent these days. And yes, to a degree it’s catch-22; need credit to have a history, but need a history to get credit.
Gas cards are usually pretty easy to get. There are also online services where you apply for a card and may/may not get pre-approved. I had luck with them. If they offer the secured card, shop elsewhere.
12/05/2009 at 9:43 am
REYNALDO
You are considered a “ghost” since you have no credit history. That doesn’t mean you did anything wrong or bad…just you have to establish some credit, then re-apply. Get a store credit card first (any store). Use it and pay it in a timely manner. This will establish you with a credit rating…then you can apply for a major card (like mastercard or visa). Use wisely, because if you mess up your FICO score, it will make it tough to buy a car or house later
12/06/2009 at 4:28 pm
ABE
You don’t have “bad credit”; you have no credit. Try starting with a store credit card (easier to get) or even a secured bank card.
12/07/2009 at 11:18 am
HUGO
don;t expect to get a credit card if you aren’t earning at least $10-15,000 a yr – you don’t have “bad” credit – you have “NO credit history” – try to get a “secured” credit card