topic Re: Relationship vs credit file in Credit Card Applications

Relationship vs credit file

Snook_on_the_Line — Mon, 15 Apr 2024 23:50:45 GMT

Hello out there ...

my question today is:

How much does your relationship with a bank have to do with whether or not they will approve your app for a credit card?

person A banks with 123 bank for five years

regular deposits

checking, CD and savings accounts

never overdrafts

never had a late payment

has a fico of 699

income 100k

1 old collection

person B has no prior relationship with 123 bank

same income, but better scores and no baddies

does the fact that person A has a good relationship with the bank make up for the difference in their credit files

can they both get the same card with comparable rates and sl?

Re: Relationship vs credit file

NoHardLimits — Tue, 16 Apr 2024 00:00:31 GMT

It depends on the bank. Some will loosen underwriting standards if you already have an established relationship. Other banks aren't swayed at all, even if you have substantial deposits. Credit unions usually require a pre-existing membership.

Re: Relationship vs credit file

FicoMike0 — Tue, 16 Apr 2024 00:08:28 GMT

First, if this person A is me, I have not had 123 banks in five years. I do churn a lot of accounts, but not that many! Maybe by five years from now...lol. Right now, I only have accounts with 16 banks.

All seriousness aside, my local medium size bank fixed me up when I was unscorable. The only big bank I've heard that about is wells. I did just get approved by us b after opening a checking account, but who knows? If they offer a nice sign up bonus, I'll have an account there.

As far as sl, that really seems like a crap shoot. I suppose they look at disposable income, dti, phase of the moon...

Re: Relationship vs credit file

CorpCrMgr1 — Tue, 16 Apr 2024 00:39:09 GMT

It can't hurt to have a relationship with a banker or two. The same with tellers.

Re: Relationship vs credit file

Snook_on_the_Line — Tue, 16 Apr 2024 00:51:10 GMT

@FicoMike0 wrote:
First, if this person A is me, I have not had 123 banks in five years. I do churn a lot of accounts, but not that many! Maybe by five years from now...lol. Right now, I only have accounts with 16 banks.
All seriousness aside, my local medium size bank fixed me up when I was unscorable. The only big bank I've heard that about is wells. I did just get approved by us b after opening a checking account, but who knows? If they offer a nice sign up bonus, I'll have an account there.
As far as sl, that really seems like a crap shoot. I suppose they look at disposable income, dti, phase of the moon...

With my existing relationship with Wells Fargo (123 bank) AND the recent eclipse I might have to try for one of their cards soon

im looking for a cu to join
ive got a nice chunk of change from a personal injury settlement coming in a few months

anyone know of a cu that would be more apt to give me a card with a decent sl and rate if I were to park five figures in savings and a 10k cd with them?

I was thinking Penfed maybe.

Re: Relationship vs credit file

Traveler101 — Tue, 16 Apr 2024 01:21:28 GMT

With limited amount of credit and a strong income, look into First Tech FCU. They can overlook blemishes, I was approved with a bk on my file.They can blow other lenders out of the water with established rebuilding. YMMV. You wouldn't have to park a bunch of money there, but that could always help your cause.

Re: Relationship vs credit file

FlaDude — Tue, 16 Apr 2024 01:54:13 GMT

@NoHardLimits wrote:
It depends on the bank.

This is key. I've been with the same CU for over 40 years. A few years ago my FICO 8 scores were in the 750 range, a 30 day late that was almost 6 years old, and some hefty CC balances. My CU called me out of the blue to sell me a credit card (telling me I was pre-qualified), I went ahead and applied, and they denied me, wasting an HP for a card I really didn't need. This CU has always been tight on lending but the branch was convenient so I've stayed with them. I certainly can't count on the relationship helping with credit though.

A couple of years ago I had 3 CCs with Chase with a fairly long history on a couple of them. No checking/savings account. Applied for a 4th card and they denied me, my FICO 8 scores were in the 820 range at the time, so that relationship didn't help either.

Re: Relationship vs credit file

SouthJamaica — Tue, 16 Apr 2024 20:28:01 GMT

@Snook_on_the_Line wrote:
Hello out there ...

my question today is:
How much does your relationship with a bank have to do with whether or not they will approve your app for a credit card?

person A banks with 123 bank for five years
regular deposits
checking, CD and savings accounts
never overdrafts
never had a late payment
has a fico of 699
income 100k
1 old collection

person B has no prior relationship with 123 bank
same income, but better scores and no baddies

does the fact that person A has a good relationship with the bank make up for the difference in their credit files

can they both get the same card with comparable rates and sl?

Based on my personal experience, I would say that having deposit accounts with a bank or credit union has been meaningless in terms of getting me credit.

I know there are other folks who have had, or believe they have had, different experiences.

But in my case, it has never meant a thing.

Re: Relationship vs credit file

FicoMike0 — Tue, 16 Apr 2024 23:40:52 GMT

Maybe it would help if I had an intimate relationship with the bank manager.

Re: Relationship vs credit file

Brian_Earl_Spilner — Tue, 16 Apr 2024 23:49:40 GMT

The majority of lenders are not relationship lenders so it won't matter. If you want it to matter you need to find a lender that is relationship based. Wells Fargo was mentioned, BofA is another one. Credit unions can be hit and miss especially if they're on the larger side as they start to act like a bank.

Re: Relationship vs credit file

Aim_High — Thu, 18 Apr 2024 17:55:33 GMT

I agree that ... it depends. On the specific lender as well as the nature of the relationship and the overall credit profile. By nature of relationship, I mean factors like the age of it, the depth of it (the size of deposits or size of loans), the diversity of it (number of accounts; business as well as personal?), and the quality of it (are all transactions managed responsibly?) This where someone that thinks they can open a couple of accounts with $100 or even $2000 and expect it to open the floodgates for credit in 30 days is probably wrong. It takes time and depth.

With some lenders, the threshold to make a difference may be low in the above considerations and for others, nothing may matter. A large bank is probably harder to impress than a smaller regional bank or credit union.

I agree that Bank of America is relationship-based and seems to open the doors more to seasoned clients. Their Premium Rewards credit cards are difficult to achieve without relationship, possibly to protect the high SUBs on those cards. And getting their $99.9K TCL which is typical upper lending limit for many clients (absent very large investments) is also difficult without relationship combined with the right profile. I also believe that Wells Fargo is relationship-based and I'm presently greasing the skids with them on some banking before applying for another card.

I've also seen posts where it appears Chase Bank may be more likely to approve a first card to a young, undeveloped, thin, profile if they are a banking client.

We have one legendary long-time member who is known for the tactic of establishing banking with large deposits before applying for cards, and his success seems amazing at times. But I believe he opens business and personal accounts, and I imagine the deposits are quite large.

One benefit, regardless of enhancing approvals, is simply putting yourself on the lender's radar as a customer where you may receive targeted pre-approvals. You may even receive offers not available to the general public. But as noted in the example above, unless your relationship is exceptional you would still need to meet underwriting standards. Those targeted offers may not consider new accounts, inquiries, or details from a report that might concern an underwriter.

So, as always with credit, YMMV depending on all of the above.