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Re: Do YOU exaggerate your income when applying?


jd5189 wrote:

I love honest people! lol


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Re: Do YOU exaggerate your income when applying?

I have never intentionally overstated. Although, I understate it by putting in only my base pay that is reflected on my contract and do not include other irregular payments not part of the regular contract. I would feel comfortable listing anything which is sort of "guaranteed" and I can document with paper (essentially paperwork on top of the contract - not just tax returns).

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Re: Do YOU exaggerate your income when applying?


Tommy5746 wrote:

I think we have all done it.. at least a little bit... You know when your applying for that credit card you reallllly want.. and you want everything positive possible on your side.. Soy uo slightly exaggerate your income.. Lets say you make 30k a year.. maybe you put down 33k? How many of you guys have done this before?? How much do you add on? I dont think its that wrong! Just as long as you dont go crazy saying you make 90k a year when you only gross 20k Smiley Happy


I haven't lied on a credit app.  Income too good to fib.

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Re: Do YOU exaggerate your income when applying?


Mailak wrote:

I have never intentionally overstated. Although, I understate it by putting in only my base pay that is reflected on my contract and do not include other irregular payments not part of the regular contract. I would feel comfortable listing anything which is sort of "guaranteed" and I can document with paper (essentially paperwork on top of the contract - not just tax returns).



Same here in the first part of my credit life circa 1970-1985. I just used my current gross wage income. I didn't apply after that until almost 8 years after I retired (at 50) but had stopped using credit of any sort in the 90s so I was starting fresh as of almost 4 years ago. I do not use my retirement income, which is pretty small, but total income as reflected on IRS filings. That income includes a lot of stuff that varies a lot each year so I use the minimum of the last three years IRS filings. Going forward that could be risky because income from investments is highly volatile and could potentially even be negative but what's a person to do? Go to a rolling 3 year average? Use an income estimate based on the return from converting financial assets to an annuity? I'm not a fan of annuities.

 

The CARD act actually calls for creditors to consider all sources of funds that can be used to pay debts such as assets. not just income, though few if any do.

 


I have reestablished credit over the last couple years
so my moniker is, well, rather out of date.

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Re: Do YOU exaggerate your income when applying?


cashnocredit wrote:

Mailak wrote:

I have never intentionally overstated. Although, I understate it by putting in only my base pay that is reflected on my contract and do not include other irregular payments not part of the regular contract. I would feel comfortable listing anything which is sort of "guaranteed" and I can document with paper (essentially paperwork on top of the contract - not just tax returns).



Same here in the first part of my credit life circa 1970-1985. I just used my current gross wage income. I didn't apply after that until almost 8 years after I retired (at 50) but had stopped using credit of any sort in the 90s so I was starting fresh as of almost 4 years ago. I do not use my retirement income, which is pretty small, but total income as reflected on IRS filings. That income includes a lot of stuff that varies a lot each year so I use the minimum of the last three years IRS filings. Going forward that could be risky because income from investments is highly volatile and could potentially even be negative but what's a person to do? Go to a rolling 3 year average? Use an income estimate based on the return from converting financial assets to an annuity? I'm not a fan of annuities.

 

The CARD act actually calls for creditors to consider all sources of funds that can be used to pay debts such as assets. not just income, though few if any do.

 


If the CARD act says it.. dont the banks have to follow through? Meaning, if i have 10k in a savings account... wouldnt i be able to take that into account on my app? So lets say i make 50k a year... couldnt i add the 10k in my savings to my 50k salary and put down 60k on my app? and lets say i put down 60k and amex flags me and asks for financials... Couldnt i just send in my bank statement or a letter from my bank stating that i have 10k in my savings? In my opinion this is all on the up and up and can be done..

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Re: Do YOU exaggerate your income when applying?

I guess not, because you only have the 10k once. And also some of them asks esp. for your savings, when you apply for a card.

 

I know it may be tempting to exaggerate the income. I guess as long as you do not default and you do not get a FR, nobody will find out. Still I wouldn´t do it. If I cannot qualify with me real income, I do not see why I should have the card.

 

Said that, I am still quite new to credit in USA (since March) and have a decent income which should qualify me for almost everything, once my history is long enough. Being young and with a "low" income, could make one see the world different. Smiley Happy

 

Do not get me wrong, I made my mistakes in my youth. Gladly they were in Europe and do not hunt me here in my credit history in the USA ... but in Europe I had to suffer a long time for them creditwise.

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Re: Do YOU exaggerate your income when applying?


shakalaka wrote:

I guess not, because you only have the 10k once. And also some of them asks esp. for your savings, when you apply for a card.

 

I know it may be tempting to exaggerate the income. I guess as long as you do not default and you do not get a FR, nobody will find out. Still I wouldn´t do it. If I cannot qualify with me real income, I do not see why I should have the card.

 

Said that, I am still quite new to credit in USA (since March) and have a decent income which should qualify me for almost everything, once my history is long enough. Being young and with a "low" income, could make one see the world different. Smiley Happy

 

Do not get me wrong, I made my mistakes in my youth. Gladly they were in Europe and do not hunt me here in my credit history in the USA ... but in Europe I had to suffer a long time for them creditwise.



That is the main reason CC apps rarely consider assets. They are often chunked but non-recurring. Like an inheritance, lottery win, or accident settlement. These are different critters than assets someone has built up over their working career. In the latter case this happened by good money management. Sadly, the former experiences the windfall affect, where they adjust their lifestyle upward, consume the assets too quickly, and acquire a standard of living that exceeds their longer term income.

 

The dichotomy is glaring and nearly impossibly to analyze statistically so banks just default largely to income.

 

As for the CARD act, it asks for lenders to consider all sources of funds, income and assets, available for repaying debt. The specifics are not defined. Banks don't even have to ask your income, let alone verify it. It's completely sufficient to just get an income "score" from a credit report, or, of course, stated income on an app.


I have reestablished credit over the last couple years
so my moniker is, well, rather out of date.

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Re: Do YOU exaggerate your income when applying?


Tommy5746 wrote:

This is what i find funny.. A credit card is basically a personal unsecured line of credit.. UNLESS of course its a secured credit card.. but for the majority of people its an unsecured line of credit with a card attached... You apply and rarely does any bank ask for financials... Pay stubs, w-2's... Tax returns.. etc... BUT! If you walk into your local bank or credit union and apply for a personal unsecured line of credit you need to provide paystubs, w-2's and sometimes even tax returns.. even if the line is only for 2k...AND usually the credit requirements if you walk into a bank or CU are MUCH higher than your standard CC... I find that funny when in fact they are basically the exact same thing.. Only difference is one has a card... and actually, some banks are now offering cards with their personal lines... i just find that all very funny!


I didn't see it clarified here, but a personal loan vs. a credit card are entirely different risk categories I suspect.

 

A personal loan: they hand you the cash, all right then and there.  If you walk, it's gone.

 

On a credit card, lenders can and will suspend your account if they think it's being used improperly, way before you reach the limit.  Case in point, Amex put my Zync on hold for suspected fraud, it wasn't a huge issue to clear up, but had I not been able to do so it would've been over then and there.  Also they may have some of their own ability to recoup fraudulent charges just like we as consumers do.  Also it's a challenge for most people to rack up "reasonable" expenses equating to their full credit line (assuming non-trivial/toy limit) so they have a window of time to make the decision on that.

 

I don't think there's any other problem with their doing that for other reasons too: we know that lenders commonly do SP's against your accounts for a few months post approval, and they're looking for signs that you're walking away with their money over a longer-period of time with that.

 

Actually come to think of it, maybe that's why they frown so much on cash-advances.  Hadn't thought of it in that manner before.

 

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Re: Do YOU exaggerate your income when applying?

I doubt that strategy is on the up and up.

 

If it was, I could easily gather up all my savings, checkings, 401(k), IRA, MMA, etc.. accounts and inflate my annual income by at least 50k. Imagine you do this and then at some point declare bankruptcy. The judge might see this as fraud and then you just shot yourself in the foot.

 

Most application forms specifcally ask for monthy or yearly income anyway, not total assets.

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Re: Do YOU exaggerate your income when applying?


OwNt wrote:

I doubt that strategy is on the up and up.

 

If it was, I could easily gather up all my savings, checkings, 401(k), IRA, MMA, etc.. accounts and inflate my annual income by at least 50k. Imagine you do this and then at some point declare bankruptcy. The judge might see this as fraud and then you just shot yourself in the foot.

 

Most application forms specifcally ask for monthy or yearly income anyway, not total assets.


I looked into it more.. you CAN declare your savings as part of your income as long as you draw from your savings in a standard fashion.. SO, lets say you have 20k in your savings and you set up a monthly transfer of 500.00 into a transaction checking account.. thats 6k extra you can add to your income annually... Now, i do however wonder how they allow this seeing as eventually the savings will run out if you do this..

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