My guess is that because they are guidelines not rules. The lender/creditors has the ability to over ride their "rules" and approve a customer because they desire to increase or keep their business with a particular consumer. The general criteria for approval is public knowledge but it isn't a guarantee. A prime example is their marketing techniques. We see a plethora of threads asking why creditors keep sending them applications/offers but denying the account. It is because initially they get a list of consumers who meet a basic screening criteria to send the email/mail to offering an account. It is never a guarantee of approval because once they get the full application and review all parameters being declined is still a possibility. It is possible for a consumer to appear to not meet the criteria and still be approved as well as looks great on paper but still gets declined. The creditors always have discretion to deviate from their guidelines as long as it isn't for a reason prohibited by law.
@30mm_goes_BRRRT wrote:As the thread title asks, why don't they? I feel as though transparency would only benefit lenders and would enable applicants to avoid wasted hard pulls. I understand everyone's credit profile is different and there are exceptions to most every rule, so a "standard" may not be feasible (hence manual reviews). Whatever algorithms they use, why isn't it public knowledge? There are known rules such as Chase's 5/24, but even that isn't disclosed on their website anywhere. If this is a silly question call me out, I wasn't able to find anything on the interwebz and I'm genuinely curious. Thanks all ❤️
I'd imagine a few reasons:
1. trade secret, the customers they accept and the guidelines by which they accept them make them billions of dollars, they don't want to put that information out there
2. there's no possible way to reasonably communicate all of the requirements with every possible configuration of credit profiles and their willingness to make exceptions for certain things for certain profiles but not other profiles, it would be not only a nightmare to actually explain, but probably physically impossible. We can't ask AI models how they came to their conclusions, they just did. We can extrapolate patterns and trends and apply human judgement to those, but there's no way we're going to just be able to tell somebody what they need full stop to be approved.
3. A generic guidelines list might do more harm than good if you make the guidelines too harsh, good customers don't apply. Too lenient and people feel bad when they get rejected despite meeting the guidelines. The creditor doesn't get anything out of providing a list like this as long as there are customers willing to apply without it.
4. they don't need to. When Apple/GS decided they needed customers, they added apply with confidence. When Amex decided to make a bigger push to do more lending, they added apply with confidence.
Apply with confidence (fully applying with a soft pull, a hard pull only upon accepted an 100% approved offer) I feel will be the next big credit leap, and it will be interesting to see who (if anybody) adds it next.
