topic Re: So I have a couple of questions that I need clarified... in Credit Cards

So I have a couple of questions that I need clarified.

Anonymous — Fri, 02 Jul 2021 17:32:00 GMT

Hello everyone!

It's super unfortunate that this is my first post here, but I have learned alot of lessons regarding finances and credit in the last month...but I have a couple questions that hopefully someone here can at least start or help to answer.

So, to make a long story short, I applied for the new Apple Card cause I worried my credit wouldn't be good enough for students loans (I am a grad student starting in the fall and I now know that revolving credit was never going to affect my chances at student loans) and I also wanted to better my finances. I got my first CC about two years ago, it was a Discover Student IT card which was good cause my income was basically non-exsistent minus work-study. Anyway, I called Goldman Sachs to make sure that I could include other sources of income, and I had read about an admendment to the CARD ACT that allows those who are 21+ to claim other's income and plus I like doing my research on things like this...ironically. I asked the guy straight away, "Hey, it says I can include portions of someone else's income that is available to pay my expenses. I'm a dependent, living at home, and I'm 22, does this include my parent's income?" To be blantanly honest, I was expecting him to say "no" or "yes, but only allowances" and his exact answer was "Yes, you can include your parent's income" to which I followed up with "All of it?" and he responed "Yeah, you're a dependent and said they pay for your bills...so yes you can include your parent's income" and of course I was stunned and to be honest excited. So the rest is history, I applied using my parent's income (I didn't use all of it cause I felt that was too much so I used about half which was 45k).

But then of course...anxiety and stress set in. I HATE the feeling of doing something wrong. The first two weeks after getting approved for the card and everything i didn't have that feeling, but I then starting reading threads on here and Reddit about how parental income will never count as income or very rarely, and my anxiety just skyrocketed. Even though I kept telling myself "No, it's fine, the guy said you could use it, you didn't do anything wrong" At this point I was losing sleep, not being able to think of anything else, and it was just becoming too much of a hassle. Especially since I knew it would be impossible to pass a FR if the issue ever came up. (Unless I could send in my parent's W-2s with there permission but idk if that's even possible). I tried to tell myself "No, everyone says FR (Financial Reviews) are so rare, and you're using the card responsibly, just let. it. go. Everyone says not to make a problem where there is no problem" However, the way my brain works is that I just can't cope with knowledge of doing something wrong even if it was completely unintentional. So, concluding this story, I had the Apple Card for a month, never went over my limit or maxed it out or anything, but I wanted to sleep again and a peace of mind, so I closed the account. This was a very easy process and honestly, even if closing the account was "unneccessary" or "stupid" I am fine knowing that. It was the right thing to do in my mind.

So, sorry for the long post lol, but here are my questions:

Do I have anything to worry about in terms of getting in trouble with GS or legally? Did I even do anything wrong?

Is my Discover card going to be affected when they see on my report that I recently opened and closed an account, even though it was by my request?

And lastly, just cause I'm curious, does anybody have any experience proving "other" income during FRs? Like how can you "prove" income that is not tied to you in the form of taxes?? But this last question is irrelevant to my situations now I suppose.

Thank you for taking the time to read this post and hopefully I can get some answers that can put my mind more at ease and finally get a decent nights sleep after a month of self-induced hell. A major lesson I did learn is that I am NEVER using "other" income again lol. Just what is on my tax return.

Re: So I have a couple of questions that I need clarified...

surferchris — Fri, 02 Jul 2021 05:46:03 GMT

Goldman is one of the largest Wall Street firms. And they are very savy, as probably are the employees. So if the customer service rep told you the income could be included, you were probably okay.

I would say in my humble opinion you overthought it. Just my two cents for whatever that's worth...LOL

I would have kept the card open. But if it made you feel better, and sleep better, then you made the right decision for yourself.

By the way, a FR most certainly would have never happened. And as long as you paid the bill every month, the household income would not have been an issue. Hope this helps. Take care.

Re: So I have a couple of questions that I need clarified...

Anonymous — Fri, 02 Jul 2021 05:49:13 GMT

Thanks for getting back to me!

Yeah I literally told my parents (who of course knew I was using their income cause I told them LOL) that I closed the account and they were like "you had no reason", but it helps me mentally so I'm okay with it. It is what it is. And yeah I was super surprised when GS told me I could use my parent's income but I still would advise against it now.

Re: So I have a couple of questions that I need clarified...

surferchris — Fri, 02 Jul 2021 05:53:31 GMT

No problem, best of luck to you...

Re: So I have a couple of questions that I need clarified...

Rockysocks — Fri, 02 Jul 2021 05:58:09 GMT

@Anonymous wrote:
Hello everyone!
It's super unfortunate that this is my first post here, but I have learned alot of lessons regarding finances and credit in the last month...but I have a couple questions that hopefully someone here can at least start or help to answer.

So, to make a long story short, I applied for the new Apple Card cause I worried my credit wouldn't be good enough for students loans (I am a grad student starting in the fall and I now know that revolving credit was never going to affect my chances at student loans) and I also wanted to better my finances. I got my first CC about two years ago, it was a Discover Student IT card which was good cause my income was basically non-exsistent minus work-study. Anyway, I called Goldman Sachs to make sure that I could include other sources of income, and I had read about an admendment to the CARD ACT that allows those who are 21+ to claim other's income and plus I like doing my research on things like this...ironically. I asked the guy straight away, "Hey, it says I can include portions of someone else's income that is available to pay my expenses. I'm a dependent, living at home, and I'm 22, does this include my parent's income?" To be blantanly honest, I was expecting him to say "no" or "yes, but only allowances" and his exact answer was "Yes, you can include your parent's income" to which I followed up with "All of it?" and he responed "Yeah, you're a dependent and said they pay for you bills...so yes you can include your parent's income" and of course I was stunned and to be honest excited. So the rest is history, I applied using my parent's income (I didn't use all of it cause I felt that was too much so I used about half which was 45k).

But then of course...anxiety and stress set in. I HATE the feeling of doing something wrong. The first two weeks after getting approved for the card and everything i didn't have that feeling, but I then starting reading threads on here and Reddit about how parental income will never count as income or very rarely, and my anxiety just skyrocketed. Even though I kept telling myself "No, it's fine, the guy said you could use it, you didn't do anything wrong" At this point I was losing sleep, not being able to think of anything else, and it was just becoming too much of a hassle. Especially since I knew it would be impossible to pass a FR if the issue ever came up. (Unless I could send in my parent's W-2s with there permission but idk if that's even possible). I tried to tell myself "No, everyone says FR (Financial Reviews) are so rare, and you're using the card responsibly, just let. it. go. Everyone says not to make a problem where there is no problem" However, the way my brain works is that I just can't cope with knowledge of doing something wrong even if it was completely unintentional. So, concluding this story, I had the Apple Card for a month, never went over my limit or maxed it out or anything, but I wanted to sleep again and a peace of mind, so I closed the account. This was a very easy process and honestly, even if closing the account was "unneccessary" or "stupid" I am fine knowing that. It was the right thing to do in my mind.

So, sorry for the long post lol, but here are my questions?

Do I have anything to worry about in terms of getting in trouble with GS or legally? Did I even do anything wrong?

Is my Discover card going to be affected when they see on my report that I recently opened and closed an account, even though it was by my request?

And lastly, just cause I'm curious, does anybody have any experience proving "other" income during FRs? Like how can you "prove" income that is not tied to you in the form of taxes?? But this last question is irrelevant to my situations now I suppose.

Thank you for taking the time to read this post and hopefully I can get some answers that can put my mind more at ease and finally get a decent nights sleep after a month of self-induced hell. A major lesson I did learn is that I am NEVER using "other" income again lol. Just what is on my tax return.

From one anxious person to another, I get you. I understand your actions and reactions. I just want to say that no, there's very little chance that miss Disco will care you closed your GS account. Actually, they'd probably be happy that you'll only be using them. Also, there's an even smaller chance (basically nonexistent) that you're in trouble with GS. You did nothing wrong and played by their rules (by calling their rep). I don't have much info for the using other income question.

Two tips for the future:

1) if you want credit guidance, stick to these forums instead of Reddit (and I love Reddit).

And

2) NEVER let owning credit cards stress you out when you are using them responsibly, as you seem to do. You control them, they don't control you.

Breathe, relax. Everything is okay.

Re: So I have a couple of questions that I need clarified...

Anonymous — Fri, 02 Jul 2021 06:01:56 GMT

You have literally no idea the amount of relief your response just gave me. Thank you so much!

Yeah, after everything I look at credit cards much different and feel comforting going forward handling new ones when I get a better income. Also, anxiety sucks lol.

Thanks again.

Re: So I have a couple of questions that I need clarified...

Rockysocks — Fri, 02 Jul 2021 06:21:06 GMT

You're welcome!! I'm so glad I could help because anxiety does suck. Lol.

When I was first learning about credit cards and getting my first one, I did a looooot of research, too. I remember when I first got my Capital One Platinum (my first card), I read AAAAALLLLLL of the booklet full of fine print. (TLDR: It says it's their card, and they can do whatever they want whenever they want to). It's a lot at first, but eventually credit cards are just a walk in the park. No stressing.

One thing I don't think you mentioned, was the GS account paid off when closed? If yes, you're good to go. If no, make sure you pay it off. Lol.

Re: So I have a couple of questions that I need clarified...

Anonymous — Fri, 02 Jul 2021 06:17:45 GMT

Yeah the Apple Card terms and conditions are very much a polite way of saying "we basically own you and can do WHATEVER we want" LMAO.

And yes, I paid it in full. It hasn't reported as closed yet, as I got it in May and closed it two weeks ago lol, but it had a zero balance.

Re: So I have a couple of questions that I need clarified...

Rockysocks — Fri, 02 Jul 2021 06:32:16 GMT

@Anonymous wrote:
Yeah the Apple Card terms and conditions are very much a polite way of saying "we basically own you and can do WHATEVER we want" LMAO.

And yes, I paid it in full. It hasn't reported as closed yet, as I got it in May and closed it two weeks ago lol, but it had a zero balance.

Sounds good! Not to get off topic, but good luck in grad school! And hopefully somebody will pop in soon to address the 'other income' question.

Re: So I have a couple of questions that I need clarified...

tcbofade — Fri, 02 Jul 2021 08:35:23 GMT

Honestly, you did nothing wrong and had no reason to close the card.

As already mentioned, if it helps you sleep better, you did the right thing.

As for "other income", if everything you've told us is correct, you still did nothing wrong. If you are older than 21 and live with your parents, you can honestly and legally use their income when applying for a credit card. It's called household income.

My youngest is 21 and still lives here... just used household income on an application at my encouragement. As you can imagine, a 21 year old kid listing a six figure income WILL get a phone call from the lender. I was sitting in the room while she chatted with them and was nothing but honest and they were absolutely fine. She DOES live here, we DO pay her bills, and she DOES have access to our income to pay her bills as needed.

You were fine.

...but I'm glad that you're sleeping better!

Good luck to you!

Re: So I have a couple of questions that I need clarified...

Anonymous — Fri, 02 Jul 2021 08:45:38 GMT

Thanks for the reassurance! It's greatly appreciated.

My parents looked at me with both annoyance and amusement after I told them I closed the account haha. But, Idk it is what it is. I may not have needed to close it (and I'm taking great comfort in the fact that I didn't do anything wrong) but it is important to go through this kind of stuff cause now I know for next time or when somebody I know goes through something similar.

Again, thank you for clearing up the parent''s income situation, cause I kept seeing so many people say that you just can't include it even if you're 21+ and a dependent and that was probably what pushed me to close the account mixed with my anxiety, but I believe you and the GS rep haha.

Re: So I have a couple of questions that I need clarified...

tcbofade — Fri, 02 Jul 2021 08:48:32 GMT

That's how we ALL learn.

We're happy to help, and keep asking questions! The only dumb question is the one that you didn't ask!

Re: So I have a couple of questions that I need clarified...

Anonymous — Fri, 02 Jul 2021 09:48:06 GMT

@Anonymous Unfortunately you have gotten some misinformation in the previous responses.

The intention of the amendment to the Credit CARD Act of 2009 was to allow adults over 21 years of age who are in relationships and who have established separate households to obtain credit using household income. It was not a carte blanche for adult child(ren) still living at home to use their parents' income to apply for credit even with their "encouragement" to do so. So unless you share a bank account with your parents, or you can prove that they regularly deposit funds into your bank account to support you, then you cannot claim their income as yours for the purpose of a credit application.

Please research and read Regulation Z 1026.51(a) Ability to Pay, and its official interpretation by the CFPB, especially paragraph 6 titled "Examples of considering income."

While relatively unlikely, Goldman Sachs compliance or security teams could have asked you to provide documented proof of your access to household income by requesting your parents' tax records and/or your banking information.

Re: So I have a couple of questions that I need clarified...

FormerCollegeDJ — Fri, 02 Jul 2021 10:48:15 GMT

I'm not going to say I'm an expert on all of the things you discussed in your post, but IMO you made a mountain out of a molehill.

I got my first credit cards a LONG time ago (mid-1990s); at that time credit card companies would show up on college campuses (I was an undergraduate college student at the time) and allow you to sign up for cards. I didn't know exactly what I was doing when I signed up for cards, but I did do two things related to what my parents told me: 1) I never signed up for any cards with an annual fee and 2) I never spent beyond my means in a given month regardless of the credit limits on my cards. Subsequently, I've never had an issue with running up credit card debt; there's only been a couple times when I did not pay off my card in full (due to high, unexpected expenses) when not on a 0% APR on purchases promotion in a given month, and in those cases I did PIF the following month. I also never paid attention to my credit score (until I started playing the credit game rewards game in spring 2020) or even worried about my credit limits (except if they were very low and my monthly spend might exceed them; I only ever had one card like that, a PNC card that had a $500 credit limit), but I've never had an issue with either of those things either. Subsequently, I've never been denied for a credit card and various issuers have automatically increased my credit limits without any prompting from me.

Contrary to what some people believe (especially people not on FICO Forums), credit cards are not a bad thing and they don't inherently create financial risks if you use them properly. Credit cards are a tool to enable you to essentially take short term, 30 day loans without having to worry about whether you have enough money in your checking account at the time you make a purchase. If you budget your monthly income, figure out what fixed costs you have, and understand how much discretionary income you have remaining per month and don't spend beyond that, you'll be fine. Credit card companies are less concerned about your exact income, whether it is $10 thousand/year or $10 million/year, and more concerned that you show the ability to pay your bills every month and be a reliable, trusted customer who isn't going to abuse their lines of credit and treat them like a no limit ATM that allows you to spend money you don't actually have. As long as you use your credit cards responsibly, you can have good relationship with credit card companies, have some flexibility to make some necessary or desired purchases, and build up your credit score to get better percentage rates when you need to make really large, non-credit card type purchases, like buying a house.

I wouldn't worry about using your parents' income as part of your income when you apply for credit cards. I WOULD worry about making sure you only spend within the means you actually have available to you and if at all possible pay your cards in full every month and not carry balances (or if you need to carry balances, make sure you budget your spending the following month such that you can pay off those balances, plus whatever "normal" spend you have the following month). If you do those things, you'll be fine, regardless of your actual income.

Re: So I have a couple of questions that I need clarified...

Remedios — Fri, 02 Jul 2021 17:38:35 GMT

@Anonymous I've restored your initial post after you deleted content.

While I'm glad you got your answer,

in order to appreciate those who took time to respond and for those who may have that same question in the future, post will remain in place but I will lock the thread since you've decided you no longer wish to participate in this conversation.