Computer says no - turned down by the credit card company?
You can't understand it. All the details were filled in correctly, you haven't missed any payments but still the credit card company has rejected your application. For a business that almost seems to guarantee acceptance, the sting of rejection can be a bitter pill to swallow. But before you give way to righteous indignation there are plenty of reasons why you may have been turned down, and not all of them are the fault of the credit card company. A credit card rejection does not necessarily mean you have a bad credit rating. It could be just a simple mistake.
Lenders are required by law to send you a letter telling you exactly why your application for credit has been denied, but sometimes these letters can be a little vague. So the first thing to do is make sure that the credit card company denied your application for a legitimate reason. Although mistakes are uncommon, they can and do happen. If you feel that the reason given is not legitimate grounds for denial, you can take action. The lender is also required to send you a document giving you the name of the credit agency that provided your credit details to the lender. If, when you check these details you come across inaccuracies, then it is essential that you contact the credit agency direct to inform them of the error. A simple mistake could be impacting on your finances much more than you are aware. It could be this small mistake that the lender sees as legitimate reason for refusal, and that's a situation that is easily rectified.
A credit report can be requested and (for a small fee) the credit agency will supply you with full details of your credit history. Any mistakes can be corrected and the credit agency will amend its own records accordingly. You could then go back to the original credit card company and appeal the decision to reject your initial application; however, this process has a relatively low success rate. The best course of action may be to wait a short while and then submit a fresh application.
Your credit 'score' is a mysterious enigma, usually the preserve of the banks and credit card companies. Accessing this report is a consumer's right and is a vital part of your financial management. There are three main credit agencies in the UK, all covered by full disclosure law and required to supply you with your record on demand. Your credit rating is affected by your past financial history including loans, repayments and details of how you run your finances. 'Black data' (information on late payments, defaults, CCJs and other negative aspects of credit management) is shared between financial lenders, but increasingly 'white data' is being shared too. White data tells the lenders about your financial management skills and can determine how attractive a customer you are to them. A customer who pays each monthly balance in full, takes advantage of 0% offers and appears to be the perfect credit client is, in fact, not an ideal credit card customer. Card companies like customer loyalty, and if you card jump too often, your credit rating can suffer as a result.
Credit card application denial can be the result of a range of issues, from the simple to the complex. Something as basic as forgetting to send off your electoral registration can mean that your credit rating drops - the credit card company simply doesn't have any proof of your address. Mistakes like this can be rectified easily, improving your chances of being accepted next time you apply for a credit card. If you are turned down repeatedly by several companies it may indicate a bigger problem with your credit history. This isn't the time to bury your head in the sand and hope it'll get better on its own. You can take positive steps to rectify the situation. By making sure you pay your bills on time, pay off debt rather than shifting it around and managing your score, you can stay in charge of your credit rating.
If you have been rejected for a credit card application, it is wise to wait a little while before reapplying. Giving yourself a waiting period of 90 days will also provide you with the opportunity to rectify any problems that may have led to the rejection in the first place. A scattergun approach to applications (applying to multiple credit card companies in the hope that one says yes) is a pointless exercise. All this will do is decrease your chances of being accepted by any of the companies and do more damage to your credit rating. A systematic approach and a positive attitude to financial management are the best ways to ensure that your next application is accepted.
Lenders are required by law to send you a letter telling you exactly why your application for credit has been denied, but sometimes these letters can be a little vague. So the first thing to do is make sure that the credit card company denied your application for a legitimate reason. Although mistakes are uncommon, they can and do happen. If you feel that the reason given is not legitimate grounds for denial, you can take action. The lender is also required to send you a document giving you the name of the credit agency that provided your credit details to the lender. If, when you check these details you come across inaccuracies, then it is essential that you contact the credit agency direct to inform them of the error. A simple mistake could be impacting on your finances much more than you are aware. It could be this small mistake that the lender sees as legitimate reason for refusal, and that's a situation that is easily rectified.
A credit report can be requested and (for a small fee) the credit agency will supply you with full details of your credit history. Any mistakes can be corrected and the credit agency will amend its own records accordingly. You could then go back to the original credit card company and appeal the decision to reject your initial application; however, this process has a relatively low success rate. The best course of action may be to wait a short while and then submit a fresh application.
Your credit 'score' is a mysterious enigma, usually the preserve of the banks and credit card companies. Accessing this report is a consumer's right and is a vital part of your financial management. There are three main credit agencies in the UK, all covered by full disclosure law and required to supply you with your record on demand. Your credit rating is affected by your past financial history including loans, repayments and details of how you run your finances. 'Black data' (information on late payments, defaults, CCJs and other negative aspects of credit management) is shared between financial lenders, but increasingly 'white data' is being shared too. White data tells the lenders about your financial management skills and can determine how attractive a customer you are to them. A customer who pays each monthly balance in full, takes advantage of 0% offers and appears to be the perfect credit client is, in fact, not an ideal credit card customer. Card companies like customer loyalty, and if you card jump too often, your credit rating can suffer as a result.
Credit card application denial can be the result of a range of issues, from the simple to the complex. Something as basic as forgetting to send off your electoral registration can mean that your credit rating drops - the credit card company simply doesn't have any proof of your address. Mistakes like this can be rectified easily, improving your chances of being accepted next time you apply for a credit card. If you are turned down repeatedly by several companies it may indicate a bigger problem with your credit history. This isn't the time to bury your head in the sand and hope it'll get better on its own. You can take positive steps to rectify the situation. By making sure you pay your bills on time, pay off debt rather than shifting it around and managing your score, you can stay in charge of your credit rating.
If you have been rejected for a credit card application, it is wise to wait a little while before reapplying. Giving yourself a waiting period of 90 days will also provide you with the opportunity to rectify any problems that may have led to the rejection in the first place. A scattergun approach to applications (applying to multiple credit card companies in the hope that one says yes) is a pointless exercise. All this will do is decrease your chances of being accepted by any of the companies and do more damage to your credit rating. A systematic approach and a positive attitude to financial management are the best ways to ensure that your next application is accepted.
About the Author:
James Baker is an experienced financial writer that likes to simplify the financial jargon for the public. Find out more information on the credit card application here.
posted by Debt Consolidation Loan at
7:53 AM
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