Question About Lower Scores and CC Approvals

[Anonymous]

While I have no score yet at all, and hopefully, by this time next year, I will -- what I am wondering is: HOW do folks who have FICO scores in the mid-600s, get approved for credit cards with fairly large limits?  I don't know where I got the idea but, I thought you had to have FICO scores that were well into the 700s in order to be approved for any unsecured credi card.  Please teach me what the truth is on this. 

Thank you!

[Anonymous]

The fact is that there is more to your credit report than a simple score. Lenders will look deeper. Especially lenders that you have developed a relationship with. My scores aren't good. I have a BofA prime card with a 5k limit. How is that so?...well I also have a mortgage with BofA that I have a perfect 5 year history with. My mistakes were made over 5 years ago...which is probably why I was approved for AMEX.

FICO weighs charge-offs extremely high. Even old ones. It only takes a couple to sink you into the 600s for 7 years.

[Anonymous]

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@Anonymous wrote:

FICO weighs charge-offs extremely high. Even old ones. It only takes a couple to sink you into the 600s for 7 years.

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That's another thing -- I always thought that one's credit report was supposed to be free of ALL baddies before being approved for any credit cards.  Again, I truly had no idea that it was possible to get a credit card without a clear credit report and a FICO score in the 700s. 

Thank you Balbanes for straightening me out on this. I really do appreciate it.

[Anonymous]

For instance probably a year after having credit and using it wisely you will be in the 700s right. But you only have a year of history. I have 13 years of history. I messed up 5 years ago. After 5 years of paying on time and using credit wisely I'm only at mid 600s. But, to many lenders I will be a better risk than someone with new credit. I have 5 years of reliably paying a mortage. I have 4 years of reliably paying an auto loan. Another 5 years of paying various CCs. The score isn't the end all be all.

[Anonymous]

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@Anonymous wrote:

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@Anonymous wrote:

FICO weighs charge-offs extremely high. Even old ones. It only takes a couple to sink you into the 600s for 7 years.

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That's another thing -- I always thought that one's credit report was supposed to be free of ALL baddies before being approved for any credit cards.  Again, I truly had no idea that it was possible to get a credit card without a clear credit report and a FICO score in the 700s. 

Thank you Balbanes for straightening me out on this. I really do appreciate it.

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It's np. The system is mysterious on purpose. My only advice is use it wisely...it can help you for years to come or it can haunt you. I did not heed that same advice given to me and it haunts you for much longer than you would think. Good luck!

[Anonymous]

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@Anonymous wrote:

But you only have a year of history.

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Actually, I am hoping we will be able to get an Amex card one of these days that can be backdated to our earlier, more affluent years (before health problems), to help with our AAofA.  We have an OLD closed Discover card TL that, for whatever reason, is STILL being listed on Equifax and Experian. Hopefully, that will continue to report and will help out too.

Thank you for your best wishes, as well as, for educating me regarding the actual lower qualifications of acceptance by credit card companies. I guess I only remember the old days back in the 70s and 80s when our TRW reports had to be unblemished before credit was granted.  Times DO change!

[Anonymous]

Well that's the good thing with amex once you are in the club you are always in the club. Reopen the account and party like it's 1969!!!

[Anonymous]

YES!!  And, if all goes well, we SHOULD have a really good FICO score, and be instantly approved for just about any card, from any bank.

[PNut08]

Join a credit union and get a CC through them if you can. It seems to me that in these economic times that they are more willing to give out big credit limits and reasonable interest rates.

Also, as others have said, there is a lot more to your credit report than a simple score. Someone who has a middling 600 FICO, but 13 years of history with a mix of trade lines is more likely to get a credit card than someone with only a year of history. Moreover, post-2008, it's been my experience that CCCs do take your income into account more than they use to when extending credit. If you want a high CL initially, then go through a credit union. Otherwise, you will have to build a relationship with your CCC and then request CLIs.

[Anonymous]

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@PNut08 wrote:
Someone who has a middling 600 FICO, but 13 years of history with a mix of trade lines is more likely to get a credit card than someone with only a year of history.

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That makes total sense to me. 

What doesn't make sense to me is reading about young folks who say they have screwed up their credit, yet they will apply for a credit card with the Navy Credit Union and be approved for large credit limits.  I'm not sure that I believe everything I read, ya know.