Sheila_A:

the Credit Card companies only use a point scoring for applications....

...the question was asked about card applications being turned down.

First of all its great to have "insider insight" on the Forum.

I don't want a personal argument but rather clarity on what actually happens when a credit file is searched and why oh why is so much "enhanced data" being provided to the CRA's. I don't think the OP made the point but many previous posters report being turned down despite having good or excellent CRA credit scores. Since a credit file doesn't store earning data, there must be some interaction between "earnings" (only) stated on the application form and data (only) recorded in the credit file. "Risk" can be assessed from default and late payment markers, but "affordabilty" could only be assessed by including payment or available credit trends.

I note what you say about "point scoring" but I don't believe "affordability" isn't a major factor in assessing an application for new credit.

I am not going to get into an augument but the Credit Card companies only use a point scoring for applications, that is why you can get an instant answer on line. They are only interested in payment history for applications, not amounts. The question was asked about card applications being turned down.

Sheila_A:

How much you pay off each month is irrelevant to your application, in fact the credit card companies cannot see this information.

Let me restate my point differently to avoid an unintended argument. As a result of "enhanced reporting" introduced in the last year or so there is increased data provided to the CRAs going way beyond late payment markers. This includes monthly payment made, monthly account balance and credit limit changes on a monthly basis. A cardholders monthly spend can be derived from the data.

These, in particular the monthly payment amounts, are available to be included in whatever "credit scoring" calculation or weighting the lender wishes to perform.

The "enhanced reporting" database provides for minimum payment markers, cash advance recording, introductory rate markers, though I have yet to see these fields populated.

Hi,

I work for a very large outsourcing company that processes credit cards for a large number of credit card companies, including the 2 largest.

It is correct to say that every time you apply for a card it shows on your credit rating, as if you are applying for multiple cards rather than just one, so you need to leave any further applications for 3-6 months.

How much you pay off each month is irrelevant to your application, in fact the credit card companies cannot see this information. Credit card companies work on a points system to evaluate your application. Each company has different criteria, as they want to have a particular type of cardholder, a bit like car insurance companies. What they look for is income versus outgoings, payment history - the payment has been paid on time every month and you haven't gone into arrears or over limit, whether you are in permanent paid employment and for how long.

As different card companies have different criteria you should do a bit of reseach before you apply again to see which card suits your circumstances best. What you also need to do is check which bank actually backs the card, for instance MBNA manage Virgin cards and loads more so if you apply for a lot of cards run by MBNA you are actually applying to MBNA for all of them. You can see which bank is running the card as it is usually in the small print at the bottom of the Terms & Conditions. Also BT's between some cards are not allowed, as example if you have a card with Halifax they will not transfer too/from Bank of Scotland as they are the same company.

It is a very complicated industry but I hope thi information helps.

tink1983:

but here is the problem all the cards i apply for keep turning me down???

As explained in the previous response multiple applications in a short period are temporarily damaging to a credit rating. The actual number made is important and you haven't said. The acid test of your credit rating is not whether you get declined for a 0% BT card but whether you would get declined for a low rate life of balance card, but it may temporarily be too late.

Your credit report (I assume) shows either an initial 0% BT and/or a purchases rate of 0%. I assume it shows only minimum payments being made and an increasing balance. And yes, thanks (or no thanks) to enhanced reporting lenders can see that when they search your credit file.

That is "indistinguisable" from "can't pay more", even if that is not true. The lenders also considers your earnings and outgoings as declared on the application form. For that to be seen positively you need to be reducing your credit balance by significantly more than the minimum payment every month. You didn't say so I can only guess (not).

So I would say you need to take a longer term view and start paying down the balance by at least twice the minimum payment every month. In 3 to 6 months try again once. If you aren't able to pay down the balance, unfortunately the card companies guessed right.

i have about 1400 on a credit card and the interest free will be running out in approx 3months, so i wanted to transfer the balance to another card which will allow me to pay the balance off interst free... but here is the problem all the cards i apply for keep turning me down???
this is the only card i have ever had, i have no mortgage and other than my student loan no other outstanding credit ----
any tips for getting another card to transfer the balance? or any general advice?