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Trapped by Fico

Denied for Cap One Secured Card.. WTF?

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Been working on my wife’s credit recently and had several old collections removed. She currently has zero open accounts. 3-4 old closed positive trade lines and 1 or 2 CA accounts that are just now past SOL (in the process of getting them removed now).

 

She has no Fico score with any if the 3 CRA’s. We want to start building it back up and assumed a secured card was a no brainer. We applied for the Cap One secured card and after sending them ID documents, she called them and they said, sorry.. your not approved. I was kind of surprised and disappointed we used credit pulls just to get rejected for a secured card!

 

Is this because she has no credit score? What other options do we have now?

 

Thanks!

 

 

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what did the denial letter say was the reason for the adverse action?

 

banks assume a lot of risk even booking secured cards.

 

can she added to your card(s) as an AU?

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Many banks will reject certain applicants for their secured cards.  It would help to have the precise reason listed on the denial letter.

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She called and was told no over the phone so we will have to wait for the letter to see the reason. I dont have any open credit card accounts now to add her as an AU, I only have a mortgage and installment loans at this point.. Staying away from credit cards for a while.


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26 minutes ago, Trapped by Fico said:

She called and was told no over the phone so we will have to wait for the letter to see the reason. I dont have any open credit card accounts now to add her as an AU, I only have a mortgage and installment loans at this point.. Staying away from credit cards for a while.


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There are numerous reasons why a bank will decline a secured card.  If you've burned a lender before, they may have you blacklisted.  CAs can be a reason.  
 

Shifter's suggestion is golden!  Try a different bank.  Are you elegible for Navy Federal or another credit union?  You could try Bank of America, Citi, Discover ... but just stay away from the scumbags like Credit One.  

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17 hours ago, Trapped by Fico said:

 

Been working on my wife’s credit recently and had several old collections removed. She currently has zero open accounts. 3-4 old closed positive trade lines and 1 or 2 CA accounts that are just now past SOL (in the process of getting them removed now).

 

She has no Fico score with any if the 3 CRA’s. We want to start building it back up and assumed a secured card was a no brainer. We applied for the Cap One secured card and after sending them ID documents, she called them and they said, sorry.. your not approved. I was kind of surprised and disappointed we used credit pulls just to get rejected for a secured card!

 

Is this because she has no credit score? What other options do we have now?

If the reports have tradelines showing, even ones that are closed, then there SHOULD be a Fair Isaac model that produces a score.  The only people one would reasonably expect to have NO score would be those who have NO file. 

 

The reference to collection accounts are a likely explanation as to why the bank has no interest in taking on a secured account.  Others also ask a very critical question here as to whether CrapOne is a bank that she has previously burned.  As hege notes, secured cards do not mean there is zero risk for the institution holding the funds... 

 

There are plenty of ways to begin building current tradelines, to include using your small local bank to do what amount to CD-secured personal loans that are short-term in duration.  You park a few thousand in a six-month or one-year CD and borrow against it, using the CD as the collateral to securitize the loan.  You then pay back the note across the same six or twelve month window, paying a few points above what the CD is earning.  Meanwhile, the loan reports on the reports.   

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1 hour ago, centex said:

If the reports have tradelines showing, even ones that are closed, then there SHOULD be a Fair Isaac model that produces a score.  The only people one would reasonably expect to have NO score would be those who have NO file. 

 

IIRC, FICO's score model requires at least 1 open account that has been active within the last 6 months. The relatively large number of people with no FICO score is one of the things competitors use to hammer Fair Isaac. However, Fair Isaac has opened up their newest score models to include rental and utility payments and will use those to create or enhance a score. Not sure which models they do that with.

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7 hours ago, cashnocredit said:

IIRC, FICO's score model requires at least 1 open account that has been active within the last 6 months. The relatively large number of people with no FICO score is one of the things competitors use to hammer Fair Isaac. However, Fair Isaac has opened up their newest score models to include rental and utility payments and will use those to create or enhance a score. Not sure which models they do that with.

FICO Score 8 is one. 

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So.. Got the letter today.. not sure what this means. I wonder if we should just call back? I think when my wife was on the phone with them they would’ve told her something like this. And ask for more identification perhaps?
bf96e44b5c5756a63e68225a648513a0.jpg


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38 minutes ago, Trapped by Fico said:

So.. Got the letter today.. not sure what this means. I wonder if we should just call back? I think when my wife was on the phone with them they would’ve told her something like this. And ask for more identification perhaps?
bf96e44b5c5756a63e68225a648513a0.jpg
 

Call the number provided in the letter. Good luck.

 

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5 hours ago, Trapped by Fico said:

So.. Got the letter today.. not sure what this means. I wonder if we should just call back? I think when my wife was on the phone with them they would’ve told her something like this. And ask for more identification perhaps?
bf96e44b5c5756a63e68225a648513a0.jpg


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Call them.  They will likely need to see your ID copy and a utility bill.

 

This type of reasoning is somewhat common for many different lenders.  It can mean, amongst other things:

 

1.  There is a mistake in name, DOB and / or SSN either on your application or your credit reports;

2.  Your address is not on your credit reports or they suspect your address is not a residential address;

3.  You used a VPN when you applied;

4.  A number of other data inconsistencies.  

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When I was in this same situation (denied for a capone secured card, but because of my history) at the beginning of a rebuild I was able to start a secured cc in person at my small local credit union (Los Angeles Federal Credit Union) and once they start reporting to the bureaus you are in the door. I think around a year later I applied again for a secured with CapOne and it was approved no problem.

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On 11/26/2019 at 7:13 AM, Trapped by Fico said:

She called and was told no over the phone so we will have to wait for the letter to see the reason. I dont have any open credit card accounts now to add her as an AU, I only have a mortgage and installment loans at this point.. Staying away from credit cards for a while.


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I know what I'm about to add is off-topic for your question, but wanted to drop a comment for food for though.

 

I realize you have your reasons for staying away from credit cards, but if you don't have any cards reporting right now, it may be hard to find a card on terms that you want when/if the time comes for you to apply. If I were you, I'd consider opening a card in your own name, perhaps a secured card with a low limit, to start building some revolving credit history. You could sock drawer it except for charging something you'd otherwise pay cash for and then paying the card off, every few months.

 

I think everyone here would agree that it's prudent to responsibly build your credit portfolio during the time prior to you actually needing it for something.

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On 11/26/2019 at 11:08 AM, centex said:

There are plenty of ways to begin building current tradelines, to include using your small local bank to do what amount to CD-secured personal loans that are short-term in duration.  You park a few thousand in a six-month or one-year CD and borrow against it, using the CD as the collateral to securitize the loan.  You then pay back the note across the same six or twelve month window, paying a few points above what the CD is earning.  Meanwhile, the loan reports on the reports.   

This^^^ is what I did... easy peasy.

 

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13 hours ago, policebox said:

I think everyone here would agree that it's prudent to responsibly build your credit portfolio during the time prior to you actually needing it for something.

Concur with this and it is a discussion I have had more than once with mom...she gets on me from time to time about 'I don't know why you need so many cards.' I keep explaining to her that it is always better to have the credit and NOT need it than to need it and have to hope someone will grant it...

 

Having credit does NOT mean one has to use it and max cards out.  And, as is discussed many places here on CB, using credit is NOT the same as going into debt.  Properly used, credit is a tool that works FOR the consumer and can even PAY the consumer for having used the tool...

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Thanks for the advice everyone!

Turns out they denied her because she does not have a Fico score at all. My daughter just added her as an AU to her Discover card so hopefully they will report it to all 3. That should at least give her a number.

I’m not interested in any credit cards at this time, mainly because I just dont trust myself to manage it properly. (Sad but true.. lol!)


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