Credit Questions That Baffle Me

[supervelous]

Why can't you apply for a card, see the terms you're offered, and reject those terms if you don't like APR, limit given, etc....and not have a new TL reported (only the inquiry).  Why can't we accept or reject once "approved" if not on the terms we want?

Why is there not a place where I can put in my information, authorize a hard pull, have banks and lending institutions look at my 1 hard pull (essentially share 1 app) and present me approvals or pre-approvals?  If it's because they're worried I'll accept 20 offers, maybe the site only allows me to accept 1?  Shopping around if you will.  OR, Maybe as I accept a card, all creditors who are involved can see what I have previously  accepted and what limits so they're not worried I am going to take everything and overextend?  If anything this system is less risky for them, as in the current system they won't see my new TL's until they show up on my reports and the creditor soft-pulls me.

Why do I have to apply for a specific card with Chase, or Citi?  Why can't I just apply for a credit card in general, and they show me everything I'm approved for with them and at what terms and I can pick?  Why if I app for 2 cards with Chase, do they HP me twice?  Why not use the same pull, if it's same day or within a day?  

Why did I owe $3,000 on low limit cards, consolidate to a personal loan, and my credit score shot up and started getting approved for prime cards?  Same exact amount of debt, why am I all of a sudden less of a risk?  If anything I should be more as I have the same amount of debt AND freed up my revolving lines? I'm happy about it, it just doesn't make logical sense to me.  

Why am I still carrying multiple physical cards?  Why can't I have 1 card that is ALL my cards, I get approved for new accounts, I load the information onto my 1 card and have 1 card that RULES THEM ALL (evil laugh)

What aspects of credit "baffle" you?

[dollar_bill]

I couldn't find a like button so i'm replying my approval of your post. FYI, I only pull EQ! 

Ya, dorky credit forum  humor. Shoot me!

[fot1]

Why can you have a charge off debit of say 3 years old, and when you actually pay that debit and the acount gets updated you scores drop? You can actually have  a better score by not paying old debits in some cases..

[JamesKnox]

This is HILARIOUS because it's all totally baffling! LOVE LOVE LOVE. 

Can't wait to see more of these "Baffled Stories"!!!

Totalllllly in with the CREDIT SITE that does the 1 HP and allow creditors to OFFER YOU a card. Limit on site, you can only accept one. LOVE!!! 

[Dustink]

WOOT!

Great rhetorical set of questions. I will respond anyways.

1) Applying for a card is accepting the terms no matter how vague they are written.

2-3) Banks are competing. They don't want to make it easier for somebody else to get your business. They want you to apply with them and not with anyone else. If they were competing for the best terms, they would make less money.

4) Installment loans do not factor utilization as heavily as credit cards. You are now less likely to default because you have $3,000 in available credit as a cushion. If you were to then max out your credit card along with your new installment loan. You would have a low score.

5) You must decide what is best for you, not some program. Maybe you want miles even though this single magical card thinks your cash back line is a better deal.

[Dustink]

Why do credit cards report a balance on a specific day for customers who PIF? Why can't all credit reports show more details. Customer charged $XXXX and paid balance this statement.

[RobertEG]

My take on potential issues....

Many consumers receive so-called "pre-approved" offers for credit based on creditors' abililty to obtain, under FCRA 604(c), a listing from the CRAs of consumers who meet certain criteria established by the creditor.  Those are the promotional offers that flood our mailboxes unless we opt-out of the CRA's ability to place us on such lists.

When a creditor has obtained such a listing from the CRAs, they must send a "firm offer for credit" that, if the consumer meets the criteria specified by the creditor, they must extend the offered credit. 

With that statutory requirement lingering over their heads, I would speculate that they may be reluctant, if the consumer is responding to such a firm offer, to enable the consumer to unilaterally alter the terms.  That would place into question the issue of whether they have any obligation to extend the offered credit, as it would require, on a case-by-case basis, a review of whether the consumer's counter offer relates to conditions prescribed to the CRA in order to obtain their name and address.

It then becomes a negotiation processm at different terms, and thus no longer a firm offer for credit.  Ergo, the consumer cannot just click with new terms, without the firm offer itself then cominng into question.

As for "authorizing a hard pull," that implies that the consumer has control, when initiating a request for credit, of the ability of the creditor to pull their credit report.

That is contrary to the purpose of section 604, and thus something they are not apt to support.

Section 604 already provides them authority, once a consumer has inititated a request for credit, to pull the consumer's credit report without any additional approval on the part of the consumer.  That is the entire reason that FCRA 604 exists..... to provide ease of creditor access to credit reports without need for specific consumer authorization.  I see no reason for creditors to support any limitation on their current statutory authority to pull, on their own, without any other limitations, once the consumer has actually initiated an application for credit.

Otherwise, the credit approval process would come to a crawl.