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Closed 3 credit cards last year, now I cant open a new one


ImMax
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Hi all, so last few years I closed 6+ CCs to clean up my wallet. Now I can't seem to open any credit cards, tells me too many accounts. Credit score around 780 depends which agency. I get pre approval letters then I get declined if I apply. Any thoughts? And should I not be closing cards, feels like I'm on a black list. How long would I need to wait or anything I can do.

 

Thank you

Max

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Posted (edited)
33 minutes ago, MarvBear said:

From those creditors to which you applied can you tell us what the reason(s) were for on the adverse action notices you should have received?

Here is the letter, says I have too many accounts, I have maybe 10 CCs, 1 I opened this year and 2 last year within a year time span. is that a limit for the year or something?

 

Thanks,

Max

IMG-1797.jpg

Edited by ImMax
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so thing to add one credit card has only 500$ limit us bank card, I think that's their standard is that my problem and do I need to close it?

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Very simply, the problem here is that you applied at CapitalOne.

 

For some reason, CapitalOne is always looking for ways to slap cardholders (& applicants) in the face.  They denied a CLI request on my Quicksilver card months ago because there "hasn't been enough activity on it."  (My scores are 740+ and I have $134,000 of available credit.)

 

I recommend applying at BofA; where they try harder to say yes.

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Here is the letter, says I have too many accounts, I have maybe 10 CCs, 1 I opened this year and 2 last year within a year time span. is that a limit for the year or something?
 
Thanks,
Max
IMG-1797.thumb.jpg.d247cba0684cc318082496c7f40e963c.jpg

Sometimes when you get the adverse action notice you have to read between the lines. Credit card companies are not known for being particularly clear and forthcoming with their reasoning.

How old is each of your open credit card accounts? How old were the ones you closed? Any credit card account that is not over two years old is considered new. Card issuers generally dislike seeing new accounts and some dislike them more than others.

Sometimes when an issuer says you have too many accounts that means too many for you. They can look at someone's stated income and the total limits on all your cards and think that is why you have too many credit cards.

How many of your cards report a balance on statement date? It can be that you have too many or even too few that report a balance and banks do not like that.

Another factor is just the general economic conditions at present and the general economic forecast. I have noticed that lately it is a bit more difficult to get approved even if you have excellent credit.

Regarding your experience with Capital One, I doubt that it just the number of accounts. I have around 80 open revolving accounts and CapOne bombs me with pre-approvals even though 5 of my accounts can be considered new.


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2 hours ago, ImMax said:

so thing to add one credit card has only 500$ limit us bank card, I think that's their standard is that my problem and do I need to close it?

My US Bank Visa has a $19,000 limit so I doubt $500 is their standard.  If there's no annual fee I recommend keeping it open but never let a balance report on it.

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Posted (edited)
On 5/8/2022 at 9:31 PM, Sidewinder said:

My US Bank Visa has a $19,000 limit so I doubt $500 is their standard.  If there's no annual fee I recommend keeping it open but never let a balance report on it.

Ok the reason I close them is because I like to do the signup bonus, so if I have an account with company I most likely might not get approved, my reasoning at least.. I will check if I can expand it.

 

On 5/8/2022 at 8:51 PM, PotO said:


Sometimes when you get the adverse action notice you have to read between the lines. Credit card companies are not known for being particularly clear and forthcoming with their reasoning.

How old is each of your open credit card accounts? How old were the ones you closed? Any credit card account that is not over two years old is considered new. Card issuers generally dislike seeing new accounts and some dislike them more than others.

Sometimes when an issuer says you have too many accounts that means too many for you. They can look at someone's stated income and the total limits on all your cards and think that is why you have too many credit cards.

How many of your cards report a balance on statement date? It can be that you have too many or even too few that report a balance and banks do not like that.

Another factor is just the general economic conditions at present and the general economic forecast. I have noticed that lately it is a bit more difficult to get approved even if you have excellent credit.

Regarding your experience with Capital One, I doubt that it just the number of accounts. I have around 80 open revolving accounts and CapOne bombs me with pre-approvals even though 5 of my accounts can be considered new.


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I only use about 3 cards out of 12 or so cards, is that a problem?

In last 2 years I probably opened 5 cards and closed 2

 

Thanks,

Max

Edited by ImMax
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I only use about 3 cards out of 12 or so cards, is that a problem?
In last 2 years I probably opened 5 cards and closed 2
 
Thanks,
Max

Card issuers like to close or at least reduce credit limits on unused accounts.

Nothing wrong with sign-up bonuses. One thing to watch out for is that opening a lot of accounts will keep your average age of accounts low. An AAoA of around two years or less makes you look like a newbie to potential creditors. Also, opening what they consider too many accounts within two years looks bad and is a very common reason for denial.


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Facts that I think are pertinent here:

 

#1 - It's Capital One.  While the experience of others is at odds with mine, my Capital One relationship has been (by far) more idiosyncratic than the sum of weirdness experienced through all my other lenders.  If you told me that they denied you, citing the fact that you don't own a palomino pony, it would pass with me.   Bottom line, I long ago took a pass on trying to get a competitive credit line out of Capital One.  (I might have had more success had I jumped the hoop and called for recon ... they have no product for which I find it worth the effort.)

 

#2 - It's reasonable to assume that Capital One is sensitive to new accounts (more so than FICO 8, more so than most other issuers).

 

#3 - "Too many active credit cards based on your loan history":

 

There are a couple of way to interpret the reference to "loan history" ...

 

It's possibly a reference to number of open accounts vs your overall credit age.  I can see where they may use this as a metric to identify those who are racking up a lot of new accounts with a very short credit history, seeing this segment as more risky.

 

It's possible that this is targeting your installment loan history.  Reasonably stable credit consumers take advantage of a range of credit products, looking to maximize utility and flexibility.  If you don't have installment history, or just 1 account, this may be a risk flag for them.

 

#4 - Again, yeah, it's Capital One ...

 

#5 - Obviously there's overlap in what I've cited here and previous posts.  (Just being thorough).  Truth is, "Monday morning quarterbacking" is an easy armchair exercise, but it's still guesswork.  You might want to see if you can get some insight from the "horses mouth" ... give C1 a call, ask to speak with an analyst who can briefly review the credit denial so you better understand the factors involved.  It's worth a shot.

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