topic Re: How credit limit is determined after approval? in Credit Cards

How credit limit is determined after approval?

Anonymous — Sun, 16 Jun 2013 02:58:40 GMT

My friend and I applied for BCP several days ago. I have longer credit history and larger total credit limits than him. Besides I have income while he does not. It turns out we both get approved but his limit was 5k and my limit was 2k. So I am wondering how credit limit is determined? Anyone on this board has any idea or interesting cases to share? Thanks!

Re: How credit limit is determined after approval?

jboy1972 — Sun, 16 Jun 2013 03:05:45 GMT

You can get approved with no income?

Re: How credit limit is determined after approval?

Anonymous — Sun, 16 Jun 2013 03:08:23 GMT

How is your friend approved with no income? So basically he committed fraud by lying on the app?

Re: How credit limit is determined after approval?

Anonymous — Sun, 16 Jun 2013 03:10:25 GMT

I have income, although not too much.

We are both students. Is this the reason he gets approved? I do not think he lied =).

Re: How credit limit is determined after approval?

Anonymous — Sun, 16 Jun 2013 03:11:51 GMT

I honestly don't see how it's possible to be approved for any credit card, much less by American Express, without having any income. Possible prior to the recession, but certainly not the case nowadays

Re: How credit limit is determined after approval?

HiLine — Sun, 16 Jun 2013 03:18:52 GMT

Your friend's case is already the most interesting there is.

Could it be he has a lot of assets and/or is an authorized user on his parents' cards?

Re: How credit limit is determined after approval?

Anonymous — Sun, 16 Jun 2013 03:20:15 GMT

The answer is he lied about having income and probably a pretty big one too.

Re: How credit limit is determined after approval?

Anonymous — Sun, 16 Jun 2013 03:20:47 GMT

I think that's perhaps he gets lots of assets. I know he is very rich =).

But this is not important... Does anybody have any idea on how cl is calculated upon approval? This is what puzzles me. Thanks!

Re: How credit limit is determined after approval?

Anonymous — Sun, 16 Jun 2013 03:22:31 GMT

Your credit score, income, and length of history.

Re: How credit limit is determined after approval?

myjourney — Sun, 16 Jun 2013 03:23:01 GMT

Your friend had to state some type of financials on the app question is was it true or not?

Example large bank account, investments something

Re: How credit limit is determined after approval?

Anonymous — Sun, 16 Jun 2013 03:34:25 GMT

@Anonymous wrote:
Your credit score, income, and length of history.

I'd like to add assests to that mix as well.

Re: How credit limit is determined after approval?

cashnocredit — Sun, 16 Jun 2013 03:38:05 GMT

The CARD act requires banks to consider ability to repay. This must include income and/or assets.If his friend is indeed "very rich" then he could well be acceptable even with no income though likely he has income from his wealth. You don't need to work to have income.

Re: How credit limit is determined after approval?

JonStur — Sun, 16 Jun 2013 04:03:53 GMT

@Anonymous wrote:
@Anonymous wrote:
Your credit score, income, and length of history.
+1

I'd like to add assests to that mix as well.

+100... But you asked a pretty general question. Without knowing what was on his app, it's difficult to explain AMEX's decision..did he use his parents income? Was he an AU on an account once? There are many variables...

Re: How credit limit is determined after approval?

Revelate — Sun, 16 Jun 2013 04:09:31 GMT

@JonStur wrote:
@Anonymous wrote:
@Anonymous wrote:
Your credit score, income, and length of history.
+1

I'd like to add assests to that mix as well.
+100... But you asked a pretty general question. Without knowing what was on his app, it's difficult to explain AMEX's decision..did he use his parents income? Was he an AU on an account once? There are many variables...

All of those plus a number of other random variables (specifics in the credit report such as negative types) and the almighty Oujia board Amex uses.

That said, a small limit in Amex's case with their near absurd generosity with CLI's on their revolvers, it's simply not worth worrying over.