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Is this Legit?

Valued Member

Is this Legit?

I recently applied for a signature loan with my credit union and was denied based on past credit delinquencies. So I called to see if I could get a reconsideration. Since my payment history has been on the straight and narrow for the last two years and I have GW'd some old 2006 lates away. I was told that I needed to type a letter accounting for each of my delinquencies and then those would need to be submitted with a new loan app. I heard of this happening with home loans, but personal loans. Is this a bit much? I thought after two years derogs don't have much of an effect. I just joined this CU, so is this foreshadowing for apps to come. Meaning since they are being picky about the personal loan, do you think they will be the same way about CC. Should I try and see if I can become a member some else?
Message 1 of 16
15 REPLIES
Established Contributor

Re: Is this Legit?

The two year rule is only true about minor derogs, like 30 day lates.  More serious derogs affect your score as long as they're reported.  As far as being legit, each individual creditor is going to have its own set reconsideration process.  I wouldn't call it being "picky", they're just going by their already established standards and protecting their own interests, as you do have derogs reporting by your own admission.  Perhaps you're looking for a more lenient lender and that's perfectly fine too, but I would say the CU is well within its rights here. 
Message 2 of 16
Frequent Contributor

Re: Is this Legit?


ucibaqt wrote:
I recently applied for a signature loan with my credit union and was denied based on past credit delinquencies. So I called to see if I could get a reconsideration. Since my payment history has been on the straight and narrow for the last two years and I have GW'd some old 2006 lates away. I was told that I needed to type a letter accounting for each of my delinquencies and then those would need to be submitted with a new loan app. I heard of this happening with home loans, but personal loans. Is this a bit much? I thought after two years derogs don't have much of an effect. I just joined this CU, so is this foreshadowing for apps to come. Meaning since they are being picky about the personal loan, do you think they will be the same way about CC. Should I try and see if I can become a member some else?

Rather than treat the CUs request as a negative, I'd consider it in a different light.  They could have denied your application based on the derrrogs.  Instead, it seems they want to work with you to perhaps understand your situtation when the delinquencies occurred.

 

I'm sure far more experienced posters can discuss the efferct of 2 year old delinquencies, but in this environment they are significant.

 

My advice would be to compose a detailed, personalized letter to support your argument that you have become a good credit risk, and that what happened 2 years ago was an aberration.

Message Edited by illtakecreditforthat on 07-22-2009 03:14 PM
I want PATIENCE...and I want it NOW
Message 3 of 16
Valued Contributor

Re: Is this Legit?


ucibaqt wrote:
I recently applied for a signature loan with my credit union and was denied based on past credit delinquencies.  Should I try and see if I can become a member some else?

A siganture loan is an unsecured loan. There is no collateralization of any of your belongings to "back up" the debt.

 

Should you choose to, you can simply walk away and leave the CU on the hook with little recourse to collect- and no compensation if you never pay or BK.

 

They are being prudent. You can work with them as they see they are willing to do to you, or you can walk away.

 

People turn to credit unions as they are "friendlier" then banks, yet they get angry the second they are not treated with instant decisions the BIG Banks made them used to.

You have to pick your poisons. 

Signature line begins:
Credit is not a right, but a business transaction, one that takes into account risk, and charges accordingly based on that risk.
Your credit score is an aspect of your credit profile. Important? yes but just an aspect. Contributing/supplemental information determines the finer point of the deal. Ask any question, respect me not to get mad if the answer is not the affirmation you are looking for,
Message 4 of 16
Valued Member

Re: Is this Legit?

Yes this is true I am looking for a more lenient lender. I thought CUs were the best option for that.
Message 5 of 16
Moderator Emerita

Re: Is this Legit?

Do realize that a credit union is just that, a group of members who pool deposits and extend credit to one another. As such, they have a responsibility to ensure that they're lending money to someone who will reliably pay it back, because they're loaning out one another's money.

If you want the loan, I'd comply with the request. If the loan committee is uncomfortable with your history, here's your chance to help them go over it.


edit: cna't splel
Message Edited by haulingthescoreup on 07-22-2009 03:23 PM
* Credit is a wonderful servant, but a terrible master. * Who's the boss --you or your credit?
FICO's: EQ 781 - TU 793 - EX 779 (from PSECU) - Done credit hunting; having fun with credit gardening. - EQ 590 on 5/14/2007
Message 6 of 16
Valued Contributor

Re: Is this Legit?


ucibaqt wrote:
Yes this is true I am looking for a more lenient lender. I thought CUs were the best option for that.

 

"Lenient" as in more willing to take a chance to extend credit.

 

Not "lenient" as in lend mad money too everyone with no due dillegence.

 

Although to be honest EVERY credit union has their own lending standards. You may find one willing to lend to you easily or have to do this hoop jump but get approved or just be flat out denied.

 

It is usually in your best interest to investigate the CU before you become a member to see if they will fit your needs.

 

Signature line begins:
Credit is not a right, but a business transaction, one that takes into account risk, and charges accordingly based on that risk.
Your credit score is an aspect of your credit profile. Important? yes but just an aspect. Contributing/supplemental information determines the finer point of the deal. Ask any question, respect me not to get mad if the answer is not the affirmation you are looking for,
Message 7 of 16
Valued Member

Re: Is this Legit?

Thanks for the advice. Since joining the forums. I learned that CUs are better than banks. I just moved to the chicago area and I googled CUs in the area and chose on that with which I could qualify for membership. Are there any CUs in the chicago area that anyone would recommend?
Message 8 of 16
Valued Contributor

Re: Is this Legit?


ucibaqt wrote:
Thanks for the advice. Since joining the forums. I learned that CUs are better than banks. I just moved to the chicago area and I googled CUs in the area and chose on that with which I could qualify for membership. Are there any CUs in the chicago area that anyone would recommend?

 

Why don't you consider the letter first, see what they say and THEN consider a new CU.
Signature line begins:
Credit is not a right, but a business transaction, one that takes into account risk, and charges accordingly based on that risk.
Your credit score is an aspect of your credit profile. Important? yes but just an aspect. Contributing/supplemental information determines the finer point of the deal. Ask any question, respect me not to get mad if the answer is not the affirmation you are looking for,
Message 9 of 16
Established Contributor

Re: Is this Legit?


usmc58555 wrote:

ucibaqt wrote:
Thanks for the advice. Since joining the forums. I learned that CUs are better than banks. I just moved to the chicago area and I googled CUs in the area and chose on that with which I could qualify for membership. Are there any CUs in the chicago area that anyone would recommend?

 

Why don't you consider the letter first, see what they say and THEN consider a new CU.

+1

 

You've already burned the inquiry, you might as well see the process through.  If they still say no, then you're no worse off than you already were.  

Message 10 of 16