Beefing up thin credit file can improve odds of next card approval

Opening Credits with Eric Sandberg

Erica Sandberg is a prominent personal finance authority and author of “Expecting Money: The Essential Financial Plan for New and Growing Families.” She writes “Opening Credits,” a weekly reader Q&A column about issues for people who are new to credit, for CreditCards.com.

Ask Erica a question, or see if your question has already been answered in the Opening Credits answer archive.

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With a 750-plus credit score and high income, why was I turned down for a new Chase credit card?

Just because you've successfully managed one credit card in the past, you may still have a "thin credit file," which may prevent you from being approved for more high-end cards.
Expert Q&A

Check out all the answers from our credit card experts.

Dear Opening Credits,
I have had a Chase Freedom Unlimited card since November 2016. I have been using this card for everything and even charging all of my husband's purchases on this card as well.

I applied in January 2017 for a Chase Sapphire card, but I was told I had a thin credit file. So now it's been approximately a year and a half since I’ve had this card and was turned down for the Chase Sapphire because of not enough credit history?

My credit scores are all 750-plus on all three credit agencies. My husband and I have a household income of $100,000-plus, never a late payment, pay on time always.

I don't know what they could possibly want more from me except another call to reconsideration and a detailed argument why I should have this credit card. I need a card without foreign transaction fees as I travel quite a bit. What do you advise?  – Deena

Dear Deena,
The credit scores you cite are certainly impressive! According to recent data, the average VantageScore is 675, which puts yours firmly in the upper echelons. It’s a testimony to the fact that a person can create a high credit score quickly and with a single account, as long as it’s used regularly and responsibly.

However, when a credit card issuer tells you something, believe it. A thin credit file simply means you don’t have enough information on your credit reports for them to offer you a card at this time.

It’s not an insult, but a desire to see more of what you’re already doing. Aside from your credit scores and income, the total number of open credit cards and your credit utilization ratio (the amount you owe compared to how much you can charge) are also qualification factors.

The Chase Sapphire cards – the Reserve and the Preferred – are excellent products, but there are plenty of other credit cards on the market that don’t charge foreign transaction fees.

Some, such as the Capital One QuicksilverOne Cash Rewards account, are designed for people with limited credit histories, so you may want to start there. Or get a different card with less stringent acceptance requirements. Then do what you’re doing with the first: charge, pay in full, and never miss a due date. You’ll have two cards in rotation, which will definitely help.

Options to boost your credit profile

Another way to add a line item to your credit reports is to become an authorized user on someone else’s account.

If you have a friend or family member who is willing to grant you access, that credit card would appear on your credit file. You wouldn’t be liable for payment, and as long as the account is kept in good standing, it’s appearance will bulk up your reports. Another advantage is that you would not have to apply for the card, which will reduce the temporary hard inquiry ding to your scores.

You might also consider taking out a loan to boost your credit mix, which is another credit scoring component.

For example, if you’re in the market for new furniture and the store has a good, deferred interest financing deal (such as 0 percent interest for 12 months), you can take advantage of it.

Don’t just pay on time, but delete the balance early. That activity will be recorded on your credit reports and you’ll look even more financially capable than you do now.  

In short, a couple of credit cards and possibly a loan will soon fatten up your credit file. After that you can chase after that Chase account again, and catch it.

See related: Credit card application rejected? 3 steps to getting the next one approved



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Updated: 05-23-2018