Amex Pre-Approval BCP Denial - For Being Responsible!?

[Anonymous]

As the title suggests, I'm a bit confused but figured I'd share as this is a new one to me.

All FICO's 740+, 7 total inquiries in 24 months (4 of which were rate shopping for autoloan rates on same day by dealership), 2 inquiries in 12 months. Essentially, 4 inquiries in 24 months, 2 for CC's, 1 Auto Loan,  1 Credit Union Line of Credit (friend is cosigner on this as his credit is bad and I agreed to help to establish a relationship with the credit union) - Approved on all.

Last CC application December 2019.

DTI <8% (six figure salary, all major assets owned), Utilization < 17% (never above 28% - balance PIF every month), No bads/lates/CO/or BK - ever...! Everything on reports are still open and listed as paid as agreed. Auto Loan is at 78% of initial, Line of Credit is at 24% of initial.

I'm very conservative with credit because I only take what I will use. I'd prefer to skip the nonsense and just use cash but work changed and I now have an opportunity to use credit cards for benefits. If I had used it more, the scores would be higher but I like not having to pay interest on things I can afford anyway...

AmEx pre-approval lists BCP, BCE, and Green. I'm looking for a card with no foreign transaction fees as my current primary dropped this perk and I travel extensively with work (200+ cities per year). All travel expenses are reimbursed, so a card with rewards makes sense as I get those benefits (hence my opening credit cards in the first place). BCP is 6% on my food,  3% on fuel/rideshare/tolls/etc. Perfect.

Denial... That's weird. Lets look at the reasoning. Follow the link and here are the reasons (yes, plural... LoL). Experian is @ 741 on denial letter.

• There are no bank card accounts on your credit report (Experian)

Cool... I have 3. (Checking, Savings, MMA),  but okay.. And banks aren't required to report an account to any of the 3 agencies.

• Too few credit card accounts on which, in our estimation, you have paid a majority of the balance in recent months (Experian)

I've heard of having too many credit cards being a bad thing... But too few? Also, paying your bills on time and in full is still a good thing, right?

• The length of time is too short since the first account on your credit report was opened (Experian)

Oldest closed account on the report is 7 years old... Auto Loan w/Chase is 16 months old - Paid as agreed. First CC with $5k limit is 17 months old - PIF monthly ($38k activity to date - never above 27% uti). Second CC is 7 months old - PIF monthly ($5k limit - $12k activity to date - never above 10% uti). These don't seem too new compared to the spree apps and approvals I'm constantly reading about on these forums...?

• The amount of outstanding account balances compared to their respective credit limit(s) or original loan amount(s) is too high (Experian)

The Auto Loan? 78% of the initial balance in 1.5 years is right on track for the 72 month car note... Weird. For specifics, the total owed is $29k and I only financed it so the dealership would negotiate on price as buying with cash didn't offer them enough incentive to negotiate (seriously...). I paid $30k down and financed the remaining $36k to get a 10k price cut. Line of Credit balance is $2400 of $10k initial.

Talk about a goldilocks syndrome. I guess with an 89% profit loss in the last quarter, they're looking for marginal credit they can charge collection fees on...?

Faxed (who uses faxes anymore?) over for a reconsideration as per the representatives suggestion. Failing that, I bid AmEx adieu forever.

VERY Crazy times we're living in.

*Edited*

Just decided to do a search on recent approvals from AmEx and saw an approval from a person that is currently unemployed and, apparently, used the unemployment income as their stated income and got approved. Yeah, it's hard not to feel insulted or to have respect for that type of decision making prowess when you consider my income is unaffected and 92% of every dollar I make is free and clear from ANY debt. Just wow.

[Physh1]

Computer algorithms make these decisions...it's not perfect. A recon, as you've initiated, will hopefully provide a better response.

[coldfusion]

Checking, savings, and money market accounts are not bank cards.   

You have a 72 month car loan outstanding with nearly 80% of the amount remaining. 

Your oldest active credit card is 17 months old and based on your inquiries you don't have more than 3 open. 

And yes, too few cards can be detrimental to your profile. 

Lenders in general have pulled in their claws recently due to the surge in COVID-19 related defaults and you were probably denied because they feel you don't have enough of a recent track record managing unsecured credit combined with a fairly significant committment remaining on the car loan.  It's not just you,  AMEX has even been taking AA against established cardholders. 

Surprised at the suggestion you FAX in documents for reconsideration instead of calling in and requesting.  

If you're not successful, just take it in stride and look for another issuer.    Plenty of fish in this sea. 

Good luck. 

[CreditFun]

In the same boat as you, but my profile is the opposite.

Consider getting the green, gold or platinum, if you need the no foreign transaction fee.  The card pays for themself.

Breakdown of Amex platinum right now for $550 AF

60,000 - 100,000 sigup bonus

uber 12 x $15

cellphone 12 x $20

streaming service 12 x $20

saks 2 x $50

travel credit $200

global entry $100 every 4 years

only issue is if you dine a lot, then the points wont add up as much.  you will get promos though for good restaraunts in the area.  i just add everything, and without thinking i get a bonus here and there.

gold or green might be a better option.  i plan to downgrade my card to green when my membership is up for the year.

[Anonymous]

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This... right here. ***

@coldfusion wrote:

Checking, savings, and money market accounts are not bank cards.   

You have a 72 month car loan outstanding with nearly 80% of the amount remaining. 

Your oldest active credit card is 17 months old and based on your inquiries you don't have more than 3 open. 

And yes, too few cards can be detrimental to your profile. 

Lenders in general have pulled in their claws recently due to the surge in COVID-19 related defaults and you were probably denied because they feel you don't have enough of a recent track record managing unsecured credit combined with a fairly significant committment remaining on the car loan.  It's not just you,  AMEX has even been taking AA against established cardholders. 

Surprised at the suggestion you FAX in documents for reconsideration instead of calling in and requesting.  

If you're not successful, just take it in stride and look for another issuer.    Plenty of fish in this sea. 

Good luck. 

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[Anonymous]

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@Anonymous wrote:

---

This... right here. ***

@coldfusion wrote:

Checking, savings, and money market accounts are not bank cards.   

You have a 72 month car loan outstanding with nearly 80% of the amount remaining. 

Your oldest active credit card is 17 months old and based on your inquiries you don't have more than 3 open. 

And yes, too few cards can be detrimental to your profile. 

Lenders in general have pulled in their claws recently due to the surge in COVID-19 related defaults and you were probably denied because they feel you don't have enough of a recent track record managing unsecured credit combined with a fairly significant committment remaining on the car loan.  It's not just you,  AMEX has even been taking AA against established cardholders. 

Surprised at the suggestion you FAX in documents for reconsideration instead of calling in and requesting.  

If you're not successful, just take it in stride and look for another issuer.    Plenty of fish in this sea. 

Good luck. 

---

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I want to say that I'm not a credit expert here, but I'm trying to get some insight into how these things translate into what is preceived as risk for a person with a moderate 7 figure net worth that owns (as in it's mine... No payments.) a respectable real estate portfolio and has a very low DTI with a moderate 6 figure income... Add in the stability of no spree credit and no derrogatory remarks on my report... I guess thats why I studied engineering and not finance. Too much "magic" in it for me to wrap my mind around it all.

First credit card is through TD bank. Thats a bank credit card. I also have a debit card for an account I have with them as well. Thats a bank card. I have a debit card through my credit union tied to a checking account I have with them. Thats a bank card. Neither of these debit cards are required to report as existing. Seems odd it would be a denial reason.

Has no one ever been approved for an AmEx with a car loan younger than 2.5 - 3.5 years (average mid point for current autoloan durations)? Are you suggesting people can't get approved for AmEx until they have roughly half of their auto paid off? I've used the forecast simulators and I see that if I pay that loan off in full right now, it'll actually hurt my score over the next 6 months. This line of reasoning is what confuses me about this.

As far as oldest active (very active) card is 17 months and I *only* have 2 active cards...  So I can go crazy and file several apps today, and get approved, and AmEx will see me as LESS risk than I currently am?! That doesn't seem right. 2 cards in 17 months with the last being 7 months ago seems like a pretty good spread. Do I need to play chicken and feign being a little wreckless with credit to get into that sweet spot to be just the right amount of unstable for them to "like" me?

I'm genuinely asking here. I know it sounds condescinding, but will those maneuvers really help me? 

[M_Smart007]

Hi  @Anonymous and Welcome to the forums!

As suggested, The lending landscape is not what it was 6 months ago.

Lender's are very skiddish and selective on who they approve right now.

Even the very best get denied ...

https://ficoforums.myfico.com/t5/Credit-Card-Applications/AMEX-wants-my-business/m-p/6026334#M265355

[ccquest]

Seems a little weird that you were denied on a stronger (in my eyes at least) profile than mine although I went for BCE instead of BCP.

Your owned real estate does not factor into calculations unless it is generating income and part of your reported income, otherwise they know nothing about it.

My car loan was started in January 2017 so it is right around the 3.5 year mark you asked about, but I also have major student loans (one reporting over 100% and the other at 80% when applying).

As far as your "bank cards" it is asking for large national bank issued CREDIT cards, nobody cares about debit cards because that's your own money. So the only one you listed that counts it the TD credit card, but I only had a BoA CC when I got approved for my AMEX card (and 3 other inquiries for cards that I was approved for at the time but had yet to report).

Paying off your only installment loan hurts your score because that helps your credit mix, as does having 3+ credit cards. The most points on loans come at 1-9%.

The chicken and egg game for scoring comes from having a good number of currently paid accounts (with a mix of CCs and installment loans) that are reporting with no negatives, not from having no outstanding debt obligations.

[Heatt99]

Sorry for the denial. Guess you are not a potential cash cow that AMEX needs at this moment.

Lenders like to see a small balance on revolving as to gauge a customer will use their product; they can't see swipe times. 

With your strong profile, even with swipe fees, Amex knows you will lose them pennies on the dollar.

Try a Credit Union or other bank that would want your business. 

[Rogue46]

I opened a car loan on May 17th and was approved for an Amex revolver on June 1st so I'm not sure that would be a deciding factor at least it wasn't for me