topic Re: Amex denial- what does this mean? in Credit Card Applications

Amex denial- what does this mean?

Anonymous — Tue, 13 Nov 2018 17:54:42 GMT

I got the denial letter from my appilcation for the Starwood Preferred Guest card. I've never seen a denail that states per federal regulation we are required to evaluate your capacity to take on new debt. Your income and resources known to us is insufficient in relation to the credit you applied for and overall debt obligations as reflected in our records.

Is this because of my large student loan? I have no lates, a current FICO of 709 and good income approaching six figures. I spoke to a CSR by phone and they couldn't tell me any more than this. I'm going to try and send a letter to get more information. If it was due to the account discharged in chpater 7 in 1992, I would understand but that's not mentioned anywhere. The Delta card I just closed never grew past a lousy 1K starting line either. I'm trying to determine what in my profile makes Amex hate me.

Re: Amex denial- what does this mean?

Anonymous — Tue, 13 Nov 2018 18:02:43 GMT

@Anonymous wrote:
I got the denial letter from my appilcation for the Starwood Preferred Guest card. I've never seen a denail that states per federal regulation we are required to evaluate your capacity to take on new debt. Your income and resources known to us is insufficient in relation to the credit you applied for and overall debt obligations as reflected in our records.

Is this because of my large student loan? I have no lates, a current FICO of 709 and good income approaching six figures. I spoke to a CSR by phone and they couldn't tell me any more than this. I'm going to try and send a letter to get more information. If it was due to the account discharged in chpater 7 in 1992, I would understand but that's not mentioned anywhere. The Delta card I just closed never grew past a lousy 1K starting line either. I'm trying to determine what in my profile makes Amex hate me.

The Credit CARD Act of 2009 requires lenders to evaluate a borrower's "ability to pay." What the letter is saying is that based on your income and assets that you declared to Amex in your application, and compared to your financial obligations(loans, etc) recorded on your credit report, Amex does not think you have sufficient "ability to pay."

Do you know what your current DTI is?

Re: Amex denial- what does this mean?

RonM21 — Tue, 13 Nov 2018 18:30:21 GMT

OP sorry it is not working out for you with them. As MaizeandBlue said, the lender can evaluate your ability to pay. Now, how often these lenders actually dig deep enough may easily vary from profile to profile. Often times, we see they give out limits that might clearly be too much for an individual. But there are those times when they do evaluate it closer. Hopefully, you can get the answer you are in search of from them.

Re: Amex denial- what does this mean?

joltdude — Tue, 13 Nov 2018 19:34:15 GMT

@Anonymous wrote:
I got the denial letter from my appilcation for the Starwood Preferred Guest card. I've never seen a denail that states per federal regulation we are required to evaluate your capacity to take on new debt. Your income and resources known to us is insufficient in relation to the credit you applied for and overall debt obligations as reflected in our records.

Is this because of my large student loan? I have no lates, a current FICO of 709 and good income approaching six figures. I spoke to a CSR by phone and they couldn't tell me any more than this. I'm going to try and send a letter to get more information. If it was due to the account discharged in chpater 7 in 1992, I would understand but that's not mentioned anywhere. The Delta card I just closed never grew past a lousy 1K starting line either. I'm trying to determine what in my profile makes Amex hate me.

A 1K Amex card is a red flag, ditto for the discharge in 1992, a large student loan that *im guessing isn't paid down much*, Amex has a long memory... Amex was forgiving with the 1K amex... but they didn't forget... Can I ask how much you burned them for?

Might be worth offering to pay them back if you can afford it....

-J

Re: Amex denial- what does this mean?

Malcono — Tue, 13 Nov 2018 20:07:43 GMT

Amex has a long memory.

Closing the Delta card may not have been the best choice if you're trying to show them you aren't as bad as before.

Re: Amex denial- what does this mean?

Anonymous — Tue, 13 Nov 2018 20:39:34 GMT

They took a loss of 3K in 1992 on two cards. I have much better luck with Citi, Navy and Penfed so closing the Amex wasn't a big loss. I just find it interesting I never have a problem with anyone else but Amex. Never had an issue getting an auto lan and i have three of them paid off in the last five years, so definately have shown i learned my lesson from being young and stupid back in college.

As to the Delta I closed, never carried a balance, so no interest paid. I tried heavy use as advocated by some here paying before the statement date and I tried the leave it locked in the sock drawer neither had an impact on the account growing. Frankly an airline card with that low limit is worthless for travel and there was no way to convert it to a cash back card so it had to go.

Re: Amex denial- what does this mean?

Anonymous — Tue, 13 Nov 2018 20:43:23 GMT

Thanks for the insight Jolt, the student loan hasn't moved down much. My daughter has an illness which requires a number of expensive meds each month so the loan has taken a backseat. She's 19 now and recently got her disability claim approved, now i should be able to get back on track with the student loan and start brining that balance down.

Re: Amex denial- what does this mean?

blindambition — Tue, 13 Nov 2018 20:50:08 GMT

@Malcono wrote:
Amex has a long memory.
Closing the Delta card may not have been the best choice if you're trying to show them you aren't as bad as before.

I think this is also a reason. After rebuild, it is showing impulsive by not aging account. IMO I also can see them possibly coming to think you are just chasing.

Re: Amex denial- what does this mean?

Anonymous — Tue, 13 Nov 2018 20:55:23 GMT

Perhaps but the account was two years old so i didn't just open then close it. I even upgraded to the platinum thinking maybe it would help.

Re: Amex denial- what does this mean?

joltdude — Tue, 13 Nov 2018 23:28:52 GMT

Give it some time... If you wanna take another go at it.. wait untill some of your student loan moves down.. even 6 months of payments... I'm guessing once that starts moving down.. you might have a better chance.. Only thing i might have done different would have been to hold on to the 1K card for a bit longer and see if they would bite for a CLI a few months once you start making some payments on that student loan... watch to see what happens with your score and then try for just an SP CLI in 6 months... or then app for a new card... Really do think they remember.. and possibly want to see the loan moving down... remember reason codes are still kinda vague... the other thing if you kept the old card it could have possibly a SP on denial and HP only if you were approved.... you closed that door by closing the card as well...

I know, hindsight is 20/20.. but its something to keep in mind for next time if your still interested in going for it..

Though i would be trying preapprovals but wait until you have at least a few payments under your belt...

Revisit this situation with your scores (preferably a FICO or two, or all 3 even) and even come back on here in 3 months.. At that time try a prequal even...

Might be able to point you in a direction a bit better..

I think you still can. but your gonna have to have even a bit more patience..

-J

Re: Amex denial- what does this mean?

CreditInspired — Tue, 13 Nov 2018 23:50:36 GMT

OP

Based on limited info provided, I’m going to take a stab. Let’s say you make $96K and you have student loans, CCs, other loans, etc, that you’re making minimum payments on. It doesn’t matter how much you make if the lender doesn’t see the debt decreasing quickly. With a 709 score and huge debtload, AmX is seeing you as a risky borrower at this moment in time.

Also, notice that the letter said your income and resources known to us. Is it possible you have assets that you didn’t include in your application that can be taken into consideration?

And they’re talking about overall debt obligation as reflected in their records. So how much was discharged in 1992? Was it a large amount?

So what is in your profile? What are your FICO scores, UT, and AAOA? What are your CLs with other CC and are you paying more than minimum payments?

It seems there may be more to the story.

Re: Amex denial- what does this mean?

AverageJoesCredit — Wed, 14 Nov 2018 00:14:03 GMT

Burned for 3k? Yeah that can irk Amex but thats not world ending amount. If they are talking about your income and debt they see something that worries them. I believe i burned them for about $1500 and im doing ok after 10 years on their bk. This from 1998 not 1992.

Re: Amex denial- what does this mean?

JR_TX — Wed, 14 Nov 2018 01:09:24 GMT

I agree with everyone’s take on your case. Your DTI and util are what scared Amex off and your past/history with them turned them even further off. High risk and zero profitability for them. To put it in perspective, if Amex ever forgives me from burning them on my BK7 in 2011, I’d take a $100 SL from them all they long, use the heck out of it and PIF for as long as it takes until they decide to set me free from their CL purgatory!

Re: Amex denial- what does this mean?

Anonymous — Wed, 14 Nov 2018 21:26:38 GMT

The irony in my situation, the card discharged in chapter 7 was an orginal optima card before they moved it into being the oasis program, that program didn't even exist back then. One would believe if that old charge off was an issue they would suggest/recommend/offer the oasis program BUT that has never been tendered.

Re: Amex denial- what does this mean?

Anonymous — Fri, 16 Nov 2018 04:36:00 GMT

@Anonymous wrote:
I got the denial letter from my appilcation for the Starwood Preferred Guest card. I've never seen a denail that states per federal regulation we are required to evaluate your capacity to take on new debt. Your income and resources known to us is insufficient in relation to the credit you applied for and overall debt obligations as reflected in our records.

Is this because of my large student loan? I have no lates, a current FICO of 709 and good income approaching six figures. I spoke to a CSR by phone and they couldn't tell me any more than this. I'm going to try and send a letter to get more information. If it was due to the account discharged in chpater 7 in 1992, I would understand but that's not mentioned anywhere. The Delta card I just closed never grew past a lousy 1K starting line either. I'm trying to determine what in my profile makes Amex hate me.

Seriously doubt it has anything to do with your 1992 charge off. As they gave you a Delta card two years ago. Why is your score only 709? You don't mention much about the total amount of your debts and what your utilization is. If you have not lates on your report and have many years of history hard to understand your score is that low.

Re: Amex denial- what does this mean?

Anonymous — Fri, 16 Nov 2018 06:11:33 GMT

I have $163k in student loan debt and make close to $90k a year. My DTI is 17% but my loans are in forbearance. Think it’ll go up to 25% once they will be in repayment mode. Amex gets spooked by student loans from the DPs I saw. My experian score is 716 but I also have 5 lates. I have an Amex delta Plat at $7300 cl and was approved two weeks ago for the BCP and they gave me a $2000 SL. On the same day I was approved for the CSP with a SL of $7000. The Amex letter included a point about loan balances versus principle along with my lates. Chase mentioned my lates and recent inquiries (5 in the past few months). Think certain data points in CRs spook lenders differently.

I was also denied a CLI on September 2nd for a high DTI. At the time my score was around 725 but Amex had me at my old score at 675 where my Util went from 50+% down to 1% total with all zeros except for one (AZEO) which caused a 50 point swing. The aggregate util on that one card was 5%. So maybe it has to do with that. I’ll let you know in two week when I’m due for a CLI on the same card. Being that they gave me a $2k limit for the BCP makes me believe it’ll be a big fat no.

I’m already going down the Chase path and plan on downgrading my BCP and Delta Plat to no AF cards. I’ll use them for offers like the Hulu and GrubHub ones but won’t use them regularly. Not because I’m bitter but I’m already two Chase cards deep and at 3/24. FWIW I received a $30k salary bump the past two years and getting a second Job in January (60% for fun 30% for money 10% to use my degrees) so I can wipe those loans away in 7-10 years depending how much of my bonus I throw at it although my emergency fund got wiped over the past year plus so I’ll likely build up that again quickly.

Sorry for the rambling but it took me 13 hours to get from NYC to the burbs and I had at least five million coffees.

Re: Amex denial- what does this mean?

Anonymous — Fri, 16 Nov 2018 18:11:03 GMT

@Anonymous wrote:
I have $163k in student loan debt and make close to $90k a year. My DTI is 17% but my loans are in forbearance. Think it’ll go up to 25% once they will be in repayment mode. Amex gets spooked by student loans from the DPs I saw. My experian score is 716 but I also have 5 lates. I have an Amex delta Plat at $7300 cl and was approved two weeks ago for the BCP and they gave me a $2000 SL. On the same day I was approved for the CSP with a SL of $7000. The Amex letter included a point about loan balances versus principle along with my lates. Chase mentioned my lates and recent inquiries (5 in the past few months). Think certain data points in CRs spook lenders differently.

I was also denied a CLI on September 2nd for a high DTI. At the time my score was around 725 but Amex had me at my old score at 675 where my Util went from 50+% down to 1% total with all zeros except for one (AZEO) which caused a 50 point swing. The aggregate util on that one card was 5%. So maybe it has to do with that. I’ll let you know in two week when I’m due for a CLI on the same card. Being that they gave me a $2k limit for the BCP makes me believe it’ll be a big fat no.

I’m already going down the Chase path and plan on downgrading my BCP and Delta Plat to no AF cards. I’ll use them for offers like the Hulu and GrubHub ones but won’t use them regularly. Not because I’m bitter but I’m already two Chase cards deep and at 3/24. FWIW I received a $30k salary bump the past two years and getting a second Job in January (60% for fun 30% for money 10% to use my degrees) so I can wipe those loans away in 7-10 years depending how much of my bonus I throw at it although my emergency fund got wiped over the past year plus so I’ll likely build up that again quickly.

Sorry for the rambling but it took me 13 hours to get from NYC to the burbs and I had at least five million coffees.

Maybe you are just at total exposure they want to allow you at this time. When my scores were a little over 700 they gave me only 1k on my credit cards. And I have zero debt. Probably just the lates that are holding you back. As they age off your score will increase and you will get better limits from them. Once my Experian report cleared up and I applied for an Amex card they started me with 25k limit.

Chase did give me a 24k limit and Citi a 15k limit and the same period of time Amex was giving me 1k limits so they are probably just more conservative for people with marks on their credit.

Re: Amex denial- what does this mean?

Anonymous — Fri, 16 Nov 2018 18:43:11 GMT

That is what I was thinking. I got the BCP because of the grocery spend and $200 SUB I was going to apply to my car insurance payment. I moved $5k from my Delta card to the BCP and once I PC my Delta Plat to the Delta Blue I will move an additional $1500 to the BCP making it $8500. Other than that I do not think I will open any Amex revolvers. I am on the Chase path anyway. Chase gave me $5600 on the CFU and $7000 on the CSP which is good because of the lates. Granted I have the highest interest rate possible on both cards and the BCP but two of them have 0% interest but I would still pay in full regardless. CapOne just called me to inform me my GW request for them was denied. It was an $11.99 Hulu charge that went 31 days late. I thought I had autopay on. 100% my fault. I applied for the CSP on the two year anniversary of the payment and my score went up five points even with the hard pull. Points will return but applying for mortgage will be tough with recent late payments so I have been saving extra $ so I can put a larger down payment until they age more or get removed.

Re: Amex denial- what does this mean?

paulko85 — Fri, 16 Nov 2018 18:46:24 GMT

if you have another existing AMEX line of credit, are you not able to consolidate some of your available credit to have your denied application...reconsidered and approved?