Speaking to a customer service representative likely won’t help your chances of getting approved for a credit card if the lender views you as a risk. If you’re denied a card, check your credit report to find out what needs improving, and work to build up your score.
Dear Keeping Score,
I am wondering if Discover takes into account special circumstances during the application process. There is no space for this in online applications, but do they allow for it on phone applications?
My FICO score recently went down 30 points because of emergency veterinary bills, raising my credit utilization 24%, and three hard inquiries from trying to get a balance transfer card to lower interest. I don’t want to spend more, I just want to stop paying the incredibly high interest rate of 26.99%!
Even just transferring a portion of my bill would relieve much stress by helping a lot.
Please let me know if Discover has a way to allow for special circumstances. They’ve sent me “prescreened” and “preapproved” offers many times; fewer since my score went down (current FICO 659), of course. – Angie
When I look in the mirror in the morning, if I stand just right and hold in my stomach, I think I look pretty good. However, in the real world, I’m a bit less firm than average and a little chubbier than I like to admit.
You are looking in the same mirror and it reflects what you want to see, not reality.
Speaking to a customer service rep probably won’t change the fact that you are a higher risk for new credit, excuses and circumstances notwithstanding. A FICO score of 659 is below average, and the fact that you are carrying a high balance at a high interest rate tells me you may have more than an image problem.
That being said, a phone call to a customer service representative won’t hurt anything. However, it’s unlikely that will result in a better outcome. If you have applied and been rejected, you may have some success by calling and asking for a reconsideration, but you’ll need to have a really good reason to get the lender to take a chance on you instead of following their underwriting guidelines.
For example, imagine if your ex failed to pay a joint debt that was assigned by the court in a divorce that resulted in a charge-off on your credit report, or something along those lines. If you subsequently paid off the debt and have been on time with all payments since then, that might mitigate the damage from the charge-off.
I did speak to two major card issuers on this topic and they both indicated that the use of “judgmental lending” for credit cards is extremely limited. Generally, the information they ask for is subject to automated decision making, but you can always call.
You say your score was reduced 30 points due to high credit utilization. No matter how good the cause was (pets are family, too, after all), if you have not done anything to bring that number back down I don’t know that there is much you can say in your defense.
From a lender’s perspective, your utilization is high because you failed to maintain an emergency fund to cover unexpected bills. What will you do when the next unexpected expense shows up?
See related: Why is my credit card account under review?
An established relationship with your bank could help more than a phone call
I am also more than a bit concerned about your three hard inquiries for cards that you apparently did not qualify for. I absolutely understand your desire to lower your high interest rate, but applying over and over again is doing you a lot more harm than good.
In fact, one could argue that it has done you absolutely no good at all since you are still in search of a card at a lower rate. Remember that if you call a new lender to apply over the phone, that will count as another hard inquiry (whether you are approved or not), so think carefully before you take that step and cause more damage to your score.
While it may not help you right now, for my other readers, my experience is that having an established relationship with a bank can sometimes make a difference. No, you don’t need to have a personal banker who knows you on sight and by name. What you need is a record of using the bank’s products successfully and having a strong history of cash on deposit. Cash on deposit can speak loudly on your behalf!
If you are having trouble keeping up with your payments because of the high interest rate, you can call the lender and ask for its hardship department. Very often a lender will help by reducing your rate for a period of time to allow you get on firmer ground.
Hard as it may be to hear, my advice is to wait a few months and start over. Because you were turned down three separate times for a new credit card, you are entitled to a free copy of the credit report that was used by each lender in making its decision.
You should have been notified of this when you were denied. Go back and look at the documentation you received; this notice should be included, along with information on how you can obtain the report(s) in question.
See related: When denied credit, don’t get mad, get even
Monitor your credit report and practice good credit habits
Look over your credit reports carefully. As I recently wrote in one of my columns, 25% of all credit reports have errors of one kind or another. So check yours carefully for any errors or misreporting.
If you find anything, notify the bureau in writing. They have 30-45 days to investigate your claim, so keep checking until it is done. Once your credit score recovers to over 670, I suggest that you check out CardMatch, which matches your credit and score with a lender that is more likely to approve you. Not all lenders have the same criteria.
Knowing exactly what is in your credit report is important any time you are contemplating new credit, so keep this in mind for the future. And during these months while you are waiting to try to get another card at a lower interest rate, keep your credit nose clean. This means paying your bills on time as agreed and lowering your utilization percentage by using cash instead of plastic while paying down your balance.
You can also enroll in Experian Boost or UltraFICO to give your score an added push. These programs look at your utility payment or banking information for positive data to add to your credit report. Both are free and you can opt out at any time (but note that UltraFICO is still in its pilot phase and may not be available to you just yet).
Remember to keep track of your score!