cancel
Showing results for 
Search instead for 
Did you mean: 

High scores and preapprovals

tag
user5387
Valued Contributor

High scores and preapprovals

I currently have scores above 800, but only rarely receive preapprovals, even though I'm opted-in.  I occasionally get an offer from BOA or Cap One, and that's about it.

 

I usually leave a small balance on one card, to show activity.  My income the last couple of years has been very low, around 25K.  Income is not listed on reports, but I believe that it can be estimated or obtained using a variety of means.

 

I got to wondering how creditors view things, and my guess is that people with the highest scores are not the most valuable customers, unless they can be shown to spend a lot of money.

 

I expect that creditors use sophisticated risk/reward modelling, and the people who come out on top are those who have scores high enough to limit default risk, but also have characteristics that indicate that they're likely to carry a balance.

 

I imagine that the same people are the ones who get CLIs the easiest.  I got a couple recently, but they weren't automatic.

 

A person who carries a 5K balance at 16% generates $800 in interest per year.  A person who never pays interest or annual fees would need to spend 40K a year to match this, assuming a merchant fee of 2%.

 

Comments on this?

 

Message 1 of 4
3 REPLIES 3
oscar_actuary
Frequent Contributor

Re: High scores and preapprovals


@user5387 wrote:

  A person who never pays interest or annual fees would need to spend 40K a year to match this, assuming a merchant fee of 2%.

 

Comments on this?

 


that's me.

I was getting offers well before the spending hit over 40k though.

Perhaps times have changed, or you have not opened enough lines to get your name out there?  I get more offers after I do something, like get a car loan. 

 

FICO EX 827, 2015 Feb; FICO EQ 836/900 (Citi), 2014 Dec; FICO TU08 818, 2015 Feb.

BofA Cash Rwrds Sig V 2013 10k; Fidelity Rewards AmEx /BofA 2013 15.4k; Chase Freedom Sig V 2002 24.1k; Chase Amazon Rwrds Sig V 2011 8k; Sam's Club MC 2002 10k; Dscvr It 2012 10k; Citi Dvdnd Plat Sel V 2013 8.9k; PenFed Plat Rwrds V 2013 20k; AmEx Blue Sky 2013 11.3k; AmEx BCP 2014 24.1k; Priceline Rwrds Sig V 2013 8.7k; PayPal Xtras GE Cap Plat MC 2012 5k

Message 2 of 4
Odiseous
Frequent Contributor

Re: High scores and preapprovals


@oscar_actuary wrote:

@user5387 wrote:

  A person who never pays interest or annual fees would need to spend 40K a year to match this, assuming a merchant fee of 2%.

 

Comments on this?

 


that's me.

I was getting offers well before the spending hit over 40k though.

Perhaps times have changed, or you have not opened enough lines to get your name out there?  I get more offers after I do something, like get a car loan. 

 


This makes sense. Since a score above 800 usually means you are not actively looking for new credit, you may be overlooked.

 

On the other hand, with a score that high then suddenly you are in the market for new credit, it may trigger them to react. After all, maybe you'll pick them.

TU98 751, EQ 766, EX 766 (Lender)

If at first you don't succeed; Garden for 6 months, then try again.

Work the system. Don't let the system work you.
Message 3 of 4
CreditScholar
Valued Contributor

Re: High scores and preapprovals


@Odiseous wrote:

@oscar_actuary wrote:

@user5387 wrote:

  A person who never pays interest or annual fees would need to spend 40K a year to match this, assuming a merchant fee of 2%.

 

Comments on this?

 


that's me.

I was getting offers well before the spending hit over 40k though.

Perhaps times have changed, or you have not opened enough lines to get your name out there?  I get more offers after I do something, like get a car loan. 

 


This makes sense. Since a score above 800 usually means you are not actively looking for new credit, you may be overlooked.

 

On the other hand, with a score that high then suddenly you are in the market for new credit, it may trigger them to react. After all, maybe you'll pick them.


I'm not so sure about this. I have scores ~800 and still get offers very frequently.

 

I think your income is what's holding you back, especially for offers that would otherwise be commensurate with your FICO. You're correct in that there are many ways lenders can estimate your income, from analyizing your spending patterns, your reported util every month, etc.

 

25k is extremely low, and as such your ability to spend will also be limited. Most cards that would attract scores of that type target high-earning (and high-spending) people. You don't currently fit that profile, so it's not that surprising that you're often being overlooked. If you increase your income and spending patterns, you'll find the number of offers you get will multiply quickly.

EX 798, EQ 789, TU 784
American Express Platinum (NPSL) || Bank of America Privileges with Travel Rewards Visa Signature - $23,200 CL
Barclays American Airlines Aviator Red World Elite Mastercard - $20,000 CL || Chase IHG Rewards World Mastercard - $25,000 CL
Chase Sapphire Preferred Visa Signature - $12,700 CL || Chase United MileagePlus Club World Elite MasterCard - $26,500 CL
Citibank Hilton Reserve Visa Signature - $20,000 CL || J.P. Morgan Ritz Carlton Visa Signature - $23,500 CL
Message 4 of 4
Advertiser Disclosure: The offers that appear on this site are from third party advertisers from whom FICO receives compensation.