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CC underwriting

Valued Contributor

CC underwriting

You see a lot different cards from the same company and they have different credit score requirements my initial response is "why?".... Then you see things about underwriting requirements.  Is there any information anywhere that explains this?   In other words if a score of 680 will get you one of the lenders cards why won't it get you others from the same lender

Message 1 of 3
Super Contributor

Re: CC underwriting

Because each card has different benefits.

Generally, the lower the approval criteria that is required for that specific card card, the less benefits there are. For lower underwriting criteria cards, rather than to spend money on those benefits, the banks are more focused on cost-cutting than spending simply because the risk of this subset of customers they are dealing with is higher, meaning chances of non-payment and default are higher. You don't throw more money at something that you think you aren't going to make much of a profit out of. This is why cards that have lower approval criteria often have subpar customer service, less benefits, and more restrictions.

It's just a perceived profit vs risk issue most of the time.

JPMorgan Palladium (100k), AmEx Platinum (NPSL), AmEx SPG (46k), AmEx BCP (42k), Chase Sapphire Preferred (47k), Citi Prestige (31k), Citi Thank You Preferred (27k), Citi Executive AAdvantage (25k), JPMorgan Ritz-Carlton (21k), Merrill+ (15k), US Bank Cash+ (22.5k), Wells Fargo (12k), Bloomingdale’s (12.4k), Chase Freedom (5k), Discover IT (5k).
Message 2 of 3

Re: CC underwriting

Benefits the card offers is the simple answer.

"If there's a lack of money in your life, understand that feeling worried, envious, jealous, disappointed, discouraged, doubtful or fearful about money can never bring more money to you, because those feelings come from a lack of gratitude for the money you have."

"Reactions are powerful creators because they contain every element needed to manifest—they're a combination of thought, belief, and feeling in action. Positive reactions create more positive things, and negative reactions create more negative things. If you can respond to negative situations calmly and lightly, instead of with emotional turbulence, what happens next in your life will be so much better."

- Rhonda Byrne
Message 3 of 3