which CU is right for me?

[Anonymous]

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@haulingthescoreup wrote:
Our local CU did not.

And local being local, neighborhood CU's don't get written about a lot.

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My local CU pulled all three CBR's and doc'ed me (paystubs and W-2's) when I financed my car. Of course I was just climbing out of the gutter and back on the sidewalk at the time. I could have been financed by some thieves (they abound here in FL) at 22%+ interest and the CU did it for 8% - with an unresolved PR reporting! For that I am eternally grateful!

Nine months after that I app'ed for a BofA card and was approved. This was my first new bank card app/approval in many, many years. (I waited until the PR fell off my CBR's. As soon as I noticed it was gone I was ready to app.) The date of the INQ was 12APR2008. Here's the interesting part - I app'ed PenFed for membership and a CC on 30APR2008. I asked and was approved for $5K without any issue whatsoever! Thanks to HTSU's posts I read here I felt that maybe I had left money on the table with PenFed so a few weeks later I went back an asked them to up the $5K to $10K and once again I was approved without issue.

So the nay sayers can do there worst - PenFed has done alright by me. I certainly would not recommend my plan of attack to anyone else. But on reflection it was my considered opinion that I would be approved for everything I app'ed for and I was. All the business about PenFed not liking recent app's and recent new credit is, well, dead on correct. They don't! At least most of the time. Since then they have continued to be wonderful to both myself and Her Ladyship. My credit with them has been increased, at their initiation, by 82% and Her Ladyship's has tripled!

These three moves were the foundation of my rebuilding: foot in the door, first new bankcard, followed by the strike for a five digit CL. I could not have done it without all of them, particularly the local CU and PenFed. Many good things have followed and I have been denied nothing I have app'ed for and that five digit CL from PenFed has pulled up every subsequent opening CL. Thanks a lot!

[Anonymous]

I forgot to add as well: don't put anything down on an app you are not prepared to substantiate. Thing is, certain institutions have set up difficult hurdles for the self-employed. I have been led to believe (and do believe) that PenFed is one of them. A past employer was very tough on me during their pre-employment investigation because I had an extensive previous "self directed" employment history. The company has it's own internal security department and they are tough! You would have thought I was trying to get into the CIA or NSA! (And I did prevail - I was hired.) So, when someone tells me they want to avoid doc'ing institutions I take them seriously. Therefore, avoid PenFed. Go to one of txjohn's offerings. Or wait. That's a viable option, too.

[wmarat]

Alliant did request my recent paystubs

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@Anonymous wrote:
Alliant never requested any documentation. 

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[Anonymous]

I think CUs are apt to request income verification if you seek higher CLs.  For example, they will probably be more inclined to request docs from someone requesting $10-$20K than someone requesting $2-$3K.  I would expect they have undedrwriting guidelines which correlate CL requested and FICO.  The lower the FICO, the greater the chance of requiring docs.

Interestingly, I was told by a LO at a local CU that they request income verifcation from everyone to protect themselves in case of an audit.  Makes sense.

[Anonymous]

Do you need to be in a certain group to qualify to join PSECU? Soundas like they would be a good option with Alliant. I also have a FA on my EQ file.. will it keep me from instant offers?

[Anonymous]

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@Anonymous wrote:

I think CUs are apt to request income verification if you seek higher CLs.  For example, they will probably be more inclined to request docs from someone requesting $10-$20K than someone requesting $2-$3K.  I would expect they have undedrwriting guidelines which correlate CL requested and FICO.  The lower the FICO, the greater the chance of requiring docs.

Interestingly, I was told by a LO at a local CU that they request income verifcation from everyone to protect themselves in case of an audit.  Makes sense.

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Good post. I found your last statement very interesting, I suspect this may become more the norm after many years of of easy credit. If one reads the news, it was the big banks and stated income loans which primarily toppled them. Most CUs did not get caught up in this because they were more conservative and were not clamoring for Wall Street money.

Now, as clearly seen on this CC forum the CUs are the rage and not taking the AAs that some of the big banks are.

One has to ask the question why this is?

IMO, we have been witnessing the results all credit card issuers whom are experiencing charge offs which are currently mirroring the unemployment rate taking AAs under guises not limited to the new CC laws.  

Therefore, applying for a new CC with a CU and not expecting or prepared to be asked to verify stated income on the application for any significant CL is not sound, if one expects to receive a card of said significant CL. 

Message Edited by plasticman on 08-30-2009 01:33 AM

[Jazzzy]

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@Anonymous wrote:

I think CUs are apt to request income verification if you seek higher CLs.  For example, they will probably be more inclined to request docs from someone requesting $10-$20K than someone requesting $2-$3K.  I would expect they have undedrwriting guidelines which correlate CL requested and FICO.  The lower the FICO, the greater the chance of requiring docs.

Interestingly, I was told by a LO at a local CU that they request income verifcation from everyone to protect themselves in case of an audit.  Makes sense.

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I think (but I'm much too lazy to research it) that the recent new credit card laws are having an effect on more and more CC companies having to see income documentation. CCCs now have to show that the person getting the card has the means/methods to actually pay their CC bills.

Part of why this has become law is due to the work of two mothers whose children were college students and got overwhelmed with CC debt. The young people were afraid to tell anyone and committed suicide. These two mothers chose to speak out about easy credit, especially to students.

My husband is self-employed, so we're used to having to document income. I think more thorough income documentation is a good trend. No doc/stated income real estate mortgages brought this country to its knees. We don't need more of that.

[Anonymous]

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@LynetteM wrote:

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@Anonymous wrote:

I think CUs are apt to request income verification if you seek higher CLs.  For example, they will probably be more inclined to request docs from someone requesting $10-$20K than someone requesting $2-$3K.  I would expect they have undedrwriting guidelines which correlate CL requested and FICO.  The lower the FICO, the greater the chance of requiring docs.

Interestingly, I was told by a LO at a local CU that they request income verifcation from everyone to protect themselves in case of an audit.  Makes sense.

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I think (but I'm much too lazy to research it) that the recent new credit card laws are having an effect on more and more CC companies having to see income documentation. CCCs now have to show that the person getting the card has the means/methods to actually pay their CC bills.

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This is not correct. The Credit CARD Act of 2009 requires issuers to consider "ability to repay" in making credit decisions. It does not stipulate how to do it or state that they cannot base that consideration on stated income. I don't believe any more institutions are asking for income documentation now that were previously. For most that do it is just part of there modus operandi.

‘A card issuer may not open any credit card account for any consumer under an open end consumer credit plan, or increase any credit limit applicable to such account, unless the card issuer considers the ability of the consumer to make the required payments under the terms of such account.’. 

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@LynetteM wrote:

Part of why this has become law is due to the work of two mothers whose children were college students and got overwhelmed with CC debt. The young people were afraid to tell anyone and committed suicide. These two mothers chose to speak out about easy credit, especially to students.

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There is a different section of the Credit CARD Act of 2009 that applies to "Underage Consumers". "Underage Consumers" (sub-21) are not to be considered a credit card unless they provide a cosigner or have an independent means of repaying the debt. Once again there is nothing in the law that mandates a particular way of doing this.

‘(8) APPLICATIONS FROM UNDERAGE CONSUMERS-

‘(A) PROHIBITION ON ISSUANCE- No credit card may be issued to, or open end consumer credit plan established by or on behalf of, a consumer who has not attained the age of 21, unless the consumer has submitted a written application to the card issuer that meets the requirements of subparagraph (B).

‘(B) APPLICATION REQUIREMENTS- An application to open a credit card account by a consumer who has not attained the age of 21 as of the date of submission of the application shall require--

‘(i) the signature of a cosigner, including the parent, legal guardian, spouse, or any other individual who has attained the age of 21 having a means to repay debts incurred by the consumer in connection with the account, indicating joint liability for debts incurred by the consumer in connection with the account before the consumer has attained the age of 21; or

‘(ii) submission by the consumer of financial information, including through an application, indicating an independent means of repaying any obligation arising from the proposed extension of credit in connection with the account.

‘(C) SAFE HARBOR- The Board shall promulgate regulations providing standards that, if met, would satisfy the requirements of subparagraph (B)(ii).’.

[haulingthescoreup]

I'd say that a big part of this is that CU's are member organizations, and their responsibility is to their members, not to shareholders.

When a CU extends credit, it is using its members' money. They have to answer to members, so I certainly hope that they are making certain that their loans are safe.

[Anonymous]

I think a smaller CU is more likely to require doc's as a matter of course. Larger CU's seem to request them according to some multifaceted policy.

I agree with this, too: 

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@Anonymous wrote:

I think CUs are apt to request income verification if you seek higher CLs.  For example, they will probably be more inclined to request docs from someone requesting $10-$20K than someone requesting $2-$3K.  I would expect they have undedrwriting guidelines which correlate CL requested and FICO.  The lower the FICO, the greater the chance of requiring docs.

Interestingly, I was told by a LO at a local CU that they request income verifcation from everyone to protect themselves in case of an audit.  Makes sense.

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Message Edited by creditwherecreditisdue on 08-30-2009 12:08 PM