Question about being denied new credit for having a deferred but current/open mortgage...

[PelicanSanders]

Some background info on me...

My Experian FICO score is 794 but I was recently declined for AMEX Blue Cash Preferred due to having a mortgage account in a 'deferred' staatus. 

My other scores: TU = 802 and EQ = 796. (AAoA of 7 years, oldest 16 yrs, 1 inquiry in past 24 months).

The reason i was given by AMEX for denial is that my mortgage account is deferred (due to the pandemic). Although it's deferred, the account is current and I've not missed a mortgage payment (currently shows as Open, Current status with only 'deferred' in the comments section of my Experian credit report, but I guess this 'deferred' comment is an automatic decline from AMEX. I only initiated this deferral on my mortgage at the beginning of the pandemic to protect me from getting any late fees.

My question is do you think Synchrony will decline an app for the Verizon Visa card for the same reason? I know AMEX requires excellent credit which I thought I had but apparently this deferred account indicates otherwise even though it's paid up and current...

[PelicanSanders]

My question is do you think Synchrony will decline an app for the Verizon Visa card for the same reason? I know AMEX requires excellent credit which I thought I had but apparently this deferred account indicates otherwise even though it's paid up and current...

[K-in-Boston]

Welcome to the forums!  While your score is excellent and you are not late, by having the mortgage deferred it means that you have asked for financial assistance due to a difficulty in being able to meet your existing financial obligations.  It would be an understandable reason for being denied new credit, as a lender would be fearful that if you cannot make your existing payments due then they would not expect you to pay them back for additional monies borrowed.

I would advise against applying for any additional credit until after your credit reports no longer reflect that any of your accounts are being deferred due to financial hardship.  Even if you have been making the scheduled payments anyway and just got the deferment as insurance in case you couldn't make the payment, as far as any creditor looking at your credit report is aware, you are currently unable to make your mortgage payment.

[blindambition]

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@PelicanSanders wrote:

Some background info on me...

My Experian FICO score is 794 but I was recently declined for AMEX Blue Cash Preferred due to having a mortgage account in a 'deferred' staatus. 

My other scores: TU = 802 and EQ = 796. (AAoA of 7 years, oldest 16 yrs, 1 inquiry in past 24 months).

The reason i was given by AMEX for denial is that my mortgage account is deferred (due to the pandemic). Although it's deferred, the account is current and I've not missed a mortgage payment (currently shows as Open, Current status with only 'deferred' in the comments section of my Experian credit report, but I guess this 'deferred' comment is an automatic decline from AMEX. I only initiated this deferral on my mortgage at the beginning of the pandemic to protect me from getting any late fees.

My question is do you think Synchrony will decline an app for the Verizon Visa card for the same reason? I know AMEX requires excellent credit which I thought I had but apparently this deferred account indicates otherwise even though it's paid up and current...

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If that is the only reason for denial, try a recon call. Explain that you've paid every month. Also ask your lender to remove comment. Ask to be taken out of deferred if you aren't using it.

[blindambition]

My question is do you think Synchrony will decline an app for the Verizon Visa card for the same reason? I know AMEX requires excellent credit which I thought I had but apparently this deferred account indicates otherwise even though it's paid up and current...

[PelicanSanders]

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@blindambition wrote:

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@PelicanSanders wrote:

Some background info on me...

My Experian FICO score is 794 but I was recently declined for AMEX Blue Cash Preferred due to having a mortgage account in a 'deferred' staatus. 

My other scores: TU = 802 and EQ = 796. (AAoA of 7 years, oldest 16 yrs, 1 inquiry in past 24 months).

The reason i was given by AMEX for denial is that my mortgage account is deferred (due to the pandemic). Although it's deferred, the account is current and I've not missed a mortgage payment (currently shows as Open, Current status with only 'deferred' in the comments section of my Experian credit report, but I guess this 'deferred' comment is an automatic decline from AMEX. I only initiated this deferral on my mortgage at the beginning of the pandemic to protect me from getting any late fees.

My question is do you think Synchrony will decline an app for the Verizon Visa card for the same reason? I know AMEX requires excellent credit which I thought I had but apparently this deferred account indicates otherwise even though it's paid up and current...

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If that is the only reason for denial, try a recon call. Explain that you've paid every month. Also ask your lender to remove comment. Ask to be taken out of deferred if you aren't using it.

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thanks, I actually did this and that's where I learned that all AMEX new applications with any deferrals are being declined. Phone rep had no insight into whether or not any decisions/new apps were reversed with an official recon. I did not yet ask for it to be sent up to the executive management (aka recon team) for an official recon review, but the rep did say it's possible that another hard inquiry could be initiated and even that, still declined. 

Prior to applying for AMEX BCP, I was also considering the Synchrony Verizon Visa and am still thinking about that but obviously don't want to have the same experience and lose another 5 points for separate hard inquiry... 

Just trying to gauge the risk-reward ratio here. 

[PelicanSanders]

My question is do you think Synchrony will decline an app for the Verizon Visa card for the same reason? I know AMEX requires excellent credit which I thought I had but apparently this deferred account indicates otherwise even though it's paid up and current...

[randomguy1]

Logically thinking here, if you report that you are having issues paying back a big debt, what lender is going to look at this in this financial climate and pass on the risk of extending you more credit? Lending has tightened up due to the pandemic and having a deferment on your credit report is only going to tell lenders you are a risky profile in a risky economic climate.

Echo what K mentioned above, I would not seek any more credit at this time. In addition to getting denied, other lenders might see your credit seeking behavior (credit inquries) and put you under financial review or even worse, adverse action (closing cards, lowering credit lines, etc).