Reconsideration letter to PenFed

[ocasta181]

I attempted to open a credit line at PenFed with the intention of using the introductory balance transfer to pay off five delinquent student loans. Unfortunately the delinquencies have been reported to credit bureaus. My credit ratings were in the mid 700's prior to these reporting. My scores are now in the mid 500's range. As consequence, my credit application was declined.

 

PenFed encouraged me to write a reconsideration letter explaining my scenario. A draft is below, please respond with any ideas or suggestions.

Dear Sir or Madam,

I applied for a PenFed credit card an April 3, 2014 and was declined due to the derogatory information on my credit report. I am a new college graduate and have only recently acquired a job. Being new to credit, I did not understand all the ramifications of my actions with regards to my student loans and thought I could wait until I was employed before beginning to paying them off. I've now learned that I should have applied for deferment but, now that these loans have defaulted, that is no longer an option. I want to pay these loans off, and would by the original terms, but these are now no longer available to me as they only want me to repay in full. While I could now afford the normal monthly payments, I cannot afford to pay them in full today. That is why I applied for a PenFed credit card, I am hoping to qualify and use your balance transfer offer of 4.99% for 48 months, because I know I could easily pay off these lone in full given three years to do so, in fact I think I might be able to pay them off in only 2 years!

I understand your reluctance to lend to me as I have learned about my credit report and reviewed it and gotten my FICO score and see that I am now considered high risk because of these student loans. I feel like I am in a catch 22 because I had perfect credit before these delinquencies reported and continue to have great credit except for the fact of these student loans that I now want to pay off in a realistic payment schedule. Therefore, I am hoping PenFed will reconsider my application in light of my circumstances and allow me to open a credit card so that I may payoff these loans with a balance transfer.

To aid you in your decision, I am enclosing my most recent two pay stubs to document my salary.

Thank you for your thoughtful deliberations.

Sincerely,

Edited April 4, 2014 by ocasta181

[mendelssohn]

I would not bother sending a letter. If your scores are in the 500s, you are going to have a hard time getting an approval anywhere, especially with PenFed. They are really conservative.

 

Are they Federal loans? Have you requested forbearance? You can backdate a forbearance request and get the lates removed.

[shifter]

don't bother.

 

why are you even trying to pay them off with a credit card?

 

paying them off isn't going to raise your score. in fact, that's going to guarantee the lates stick there for 7 years.

 

you need to immediately apply for a deferment and ask for it to be pre-dated to when you got out of school. that will get the lates removed and then you can start paying once you get a job.

[Menta33]

Here is OP's other post where they are discussing the loans and what to do. Apparently, they are all defaulted now and requiring payment in full and unwilling to negotiate:

 

http://creditboards.com/forums/index.php?showtopic=526522

[Menta33]

Also, since they probably won't pull a second time if the reconsideration is sent right away, I'd say it doesn't hurt to try.