topic Re: Amex denial due to loan modification in Credit Card Applications

Amex denial due to loan modification

mrcrisp023 — Thu, 06 Oct 2022 10:28:08 GMT

Hi All,

I did an app for the Amex green charge card just to see what would happen since it would only be a soft pull if I didn't take it or was denied. I expected a denial, but the reason I got back was surprising:

"You are participating in a payment relief or deferral program, receiving modified terms, or credit counseling services, on one or more of your accounts or loans."

That was the only denial reason I was given. During Covid, I got behind on my mortgage payments and did a loan mod to get caught up and have been on time since. How long is this going to hinder me from getting an approval? Should I call the back door number for more insight? Was that the only reason for the denial?

Thanks.

Re: Amex denial due to loan modification

FireMedic1 — Thu, 06 Oct 2022 10:35:17 GMT

Sorry about that. I was past the required wait time after BK to apply. I was denied for too many new checking accounts. I joined NFCU and opened 1 checking account. Yes a checking account. Waited a year and approved for the BCP. Just another denial DP.

Re: Amex denial due to loan modification

pizzadude — Thu, 06 Oct 2022 13:30:42 GMT

@mrcrisp023 wrote:
Hi All,

I did an app for the Amex green charge card just to see what would happen since it would only be a soft pull if I didn't take it or was denied. I expected a denial, but the reason I got back was surprising:

"You are participating in a payment relief or deferral program, receiving modified terms, or credit counseling services, on one or more of your accounts or loans."

That was the only denial reason I was given. During Covid, I got behind on my mortgage payments and did a loan mod to get caught up and have been on time since. How long is this going to hinder me from getting an approval? Should I call the back door number for more insight? Was that the only reason for the denial?

Thanks.

You can always request a recon but I think it's likely they'll give you the same answer as their underwriting process view this as a negative factor.

Re: Amex denial due to loan modification

mrcrisp023 — Thu, 06 Oct 2022 13:31:13 GMT

So I just spoke with my loan servicer about getting the comments removed but they said since I had the loan modification, the comments have to stay there for the entire lifetime of the loan. So as long as I'm in this house the comments have to stay there. That's extremely excessive to me. I don't know if it's worth even calling the back door number for Amex.

Re: Amex denial due to loan modification

OmarGB9 — Thu, 06 Oct 2022 18:39:41 GMT

@mrcrisp023 wrote:
So I just spoke with my loan servicer about getting the comments removed but they said since I had the loan modification, the comments have to stay there for the entire lifetime of the loan. So as long as I'm in this house the comments have to stay there. That's extremely excessive to me. I don't know if it's worth even calling the back door number for Amex.

Wouldn't cost anything to try (other than maybe some wait time)! Maybe you could get insight as to how long you'd have to wait for that effect to "fade."

I wonder also if you call your loan servicer back and speak with a different rep, if they'll give you the same answer; or perhaps you can escalate to a manager and get the comment removed.

Re: Amex denial due to loan modification

SDMarik — Thu, 06 Oct 2022 20:05:33 GMT

@mrcrisp023 wrote:
So I just spoke with my loan servicer about getting the comments removed but they said since I had the loan modification, the comments have to stay there for the entire lifetime of the loan. So as long as I'm in this house the comments have to stay there. That's extremely excessive to me. I don't know if it's worth even calling the back door number for Amex.

I know a few people who had this issue pop up, unfortunately even though it was an extenuating circumstance (covid) and people were almost encouraged to take mod/releif, issuers still view this in the same light as credit counseling/consolidation services, deferment, etc, which I don't think is totally fair. Yes, historically these things are utilized by people who are in a situation where they can't stay on top of their payments, due to something that may or may not be their fault, but this particular one should have been handled differently. I think the banks could have offered this without reporting it, unless an account went negative.

So many people took advantage of this, but it was not made abundantly clear that it would report on your file in a negative light. I get that it is on the consumer to read the fine print, and I'm not saying it should not be noted anywhere, but to present it in a way that can prohibit an otherwise responsible borrower from obtaining credit, seems slightly unfair.

Re: Amex denial due to loan modification

Zoostation1 — Fri, 07 Oct 2022 00:44:54 GMT

If it stays on for the life of the mortgate that seems like it be a massive headache for people. I'm not a lawyer and don't know any of the laws regarding it but it seems like this could stay on the record longer than even a BK7? Am I reading this correctly?

Re: Amex denial due to loan modification

mrcrisp023 — Fri, 07 Oct 2022 00:47:09 GMT

That’s what she said. I asked 2 or 3 times to make sure I was clear and she doubled down each time. I’m tempted to call back and get a different rep. Seems ridiculous.

Re: Amex denial due to loan modification

805orbust — Fri, 07 Oct 2022 00:52:20 GMT

Although the remark will stay on there for the life of the loan, I'm sure it won't affect their decision making forever. Surely there will be a time period where the effects will begin to diminish... just my opinion however, which, with a dollar won't even get you on a train anymore.

Re: Amex denial due to loan modification

mrcrisp023 — Fri, 07 Oct 2022 00:56:47 GMT

What makes me unsure is there’s no date on the comment. They can’t tell from looking when it was from. Even if I go 7 years never missing a payment they’re still gonna see that the loan was modified at some point.

Re: Amex denial due to loan modification

M_Smart007 — Fri, 07 Oct 2022 01:45:55 GMT

@mrcrisp023 wrote:
What makes me unsure is there’s no date on the comment. They can’t tell from looking when it was from. Even if I go 7 years never missing a payment they’re still gonna see that the loan was modified at some point.

@mrcrisp023, I am not sure this would help? ,

but might be worth your time to read? Should I Add a Consumer Statement to My Credit Report << link to article

Re: Amex denial due to loan modification

GZG — Fri, 07 Oct 2022 01:48:27 GMT

@mrcrisp023 wrote:
did a loan mod to get caught up and have been on time since

Are you caught up to the point that you've paid the same amount of money you would have had you not had the loan mod done?

could be a potential reason to help you negotiate with them for deciding on correctly reporting the fact that the loan is no longer under a loan mod

Re: Amex denial due to loan modification

bigseegar — Fri, 07 Oct 2022 11:59:19 GMT

@mrcrisp023 wrote:
Hi All,

I did an app for the Amex green charge card just to see what would happen since it would only be a soft pull if I didn't take it or was denied. I expected a denial, but the reason I got back was surprising:

"You are participating in a payment relief or deferral program, receiving modified terms, or credit counseling services, on one or more of your accounts or loans."

That was the only denial reason I was given. During Covid, I got behind on my mortgage payments and did a loan mod to get caught up and have been on time since. How long is this going to hinder me from getting an approval? Should I call the back door number for more insight? Was that the only reason for the denial?

Thanks.

A lot of lenders look at a Loan Modification the as a BK unfortuntely.

Re: Amex denial due to loan modification

805orbust — Fri, 07 Oct 2022 15:24:38 GMT

Whoa... @bigseegar is that true? That would suck as @mrcrisp023 was saying it has no date on it. Seems kinda grimy if you ask me. Just a low-key if making you pay dearly for something touted as a saving grace during the pandemic.

Re: Amex denial due to loan modification

bigseegar — Mon, 10 Oct 2022 14:20:12 GMT

@805orbust wrote:
Whoa... @bigseegar is that true? That would suck as @mrcrisp023 was saying it has no date on it. Seems kinda grimy if you ask me. Just a low-key if making you pay dearly for something touted as a saving grace during the pandemic.

I can only say it was true as to my case and what several banks and lenders relayed to me in 2010.

Re: Amex denial due to loan modification

mrcrisp023 — Mon, 10 Oct 2022 16:05:36 GMT

@bigseegar wrote:
@805orbust wrote:
Whoa... @bigseegar is that true? That would suck as @mrcrisp023 was saying it has no date on it. Seems kinda grimy if you ask me. Just a low-key if making you pay dearly for something touted as a saving grace during the pandemic.
I can only say it was true as to my case and what several banks and lenders relayed to me in 2010.

What ended up happening @bigseegar? Did it ever fall off or has it stuck since? Has it still prevented you from getting new credit?

Re: Amex denial due to loan modification

7774x — Mon, 10 Oct 2022 22:58:15 GMT

@M_Smart007 wrote:
@mrcrisp023 wrote:
What makes me unsure is there’s no date on the comment. They can’t tell from looking when it was from. Even if I go 7 years never missing a payment they’re still gonna see that the loan was modified at some point.
@mrcrisp023, I am not sure this would help? ,
but might be worth your time to read? Should I Add a Consumer Statement to My Credit Report << link to article

A relative who worked in bank lending said statments on CRs are worthless ..Amex getting picky on some items..they don't want you.. just say adios to them..However if you really want the card ...keep trying on prequal site

Re: Amex denial due to loan modification

mrcrisp023 — Tue, 11 Oct 2022 00:27:34 GMT

Understood, appreciate the insight. Thank you!

Re: Amex denial due to loan modification

bigseegar — Thu, 13 Oct 2022 00:21:50 GMT

@mrcrisp023 wrote:
@bigseegar wrote:
@805orbust wrote:
Whoa... @bigseegar is that true? That would suck as @mrcrisp023 was saying it has no date on it. Seems kinda grimy if you ask me. Just a low-key if making you pay dearly for something touted as a saving grace during the pandemic.
I can only say it was true as to my case and what several banks and lenders relayed to me in 2010.
What ended up happening @bigseegar? Did it ever fall off or has it stuck since? Has it still prevented you from getting new credit?

I sold the house in 2015 and for whatever reason 2 months later after the payoff had posted the bank completely removed the entire mortgage history from all 3 Bureau's. So no, not since then has it caused me any issues.

Re: Amex denial due to loan modification

mrcrisp023 — Thu, 13 Oct 2022 01:24:28 GMT

Got it. Thanks for replying back.