How to Succeed in Your New Credit Card Application?

jowu15 on 19/07/2018 - 12:45
Last edited 19/07/2018 - 12:57 by 1 other user

Hi a couple of weeks ago I applied for 28 Degree credit card and to my surprise I got knocked back because my profile is what they wanted an applicant to be. I thought I have a very lower risk of not be able to pay my credit card account. I have two credit card one with one of Big Fours (max $20,000 and was $40,000 before) and another with a major supermarket ($11,000). I have a stable job and pay reasonably well and I paid off my house in inner Bayside suburbs and I have investment properties with a mortgage but not too big, I am not close to retirement age.

I just wonder why they knock me back? Is that because I stated I only have $1000 owing on my credit card (I pay my credit card off every month) so they do like they cannot charge me! Is it that my credit score is not good? I do not know, I never bothered to check on it. Maybe I should request a copy. I have not applied for too many credit cards, but I did applied an American Express when they send a form to me earlier this year, I applied got proved but I cancelled my application before they send me the card as I found 28 Degree is better suited to my needs. I want it only for online purchase and oversea travelling.

I would like to know how to increase my chance of success in my future application. They said I can try again when my financial situation changes. How long I have to wait, before I can put another application in? My banks charged me overseas transaction fees for some online stores I thought was Australian stores, so I need to sort this one out pretty quick. Is there any other credit card offer low cost in international transactions? Thanks in advance

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Comments

  • Jumpingmanjim on 19/07/2018 - 12:50
    +3

    Check your credit scores.

    • jowu15 on 19/07/2018 - 13:21

      yes I think I should do it

  • [Deactivated] on 19/07/2018 - 12:57
    +3

    Here I thought they were giving out credit cards to anyone drawing breath.

    • jowu15 on 19/07/2018 - 13:22
      +1

      lol they give you when you donot want it but reject you when you want to

  • meowmeowmeow on 19/07/2018 - 13:13
    +2

    Get the bankwest platinum credit card, it doesnt have overseas transaction fees either. 28 degrees can be a bit weird, they knocked me back for a credit limit increase (from 4k to 6k) for some unknown reason as well.

    • jowu15 on 19/07/2018 - 13:19

      You only want to increase your credit by $2000 and they rejected you. How long have you been with them?
      Thanks for the information about Bankwest I will try it

      • meowmeowmeow on 19/07/2018 - 13:29

        Honestly i had been with them since like 2011, and always repaid on time. I think they have much stricter rules than everyone else, as i've never been declined elsewhere.

        • jowu15 on 19/07/2018 - 19:16

          I wonder why they did not agree to increase your limit.

  • jimbobaus on 19/07/2018 - 13:15
    +5

    Credit "scores" are worth nothing
    most banks don't even use them when assessing lending

    Most likely the reason you were declined even though you only owe $1000 on your cc you have $31,000 in credit available to you
    its all about capacity and responsible lending laws.
    They have to assess you based on the entire balance of your existing debts and available credit.

    • jowu15 on 19/07/2018 - 13:29

      Maybe I am going to reduce my bank credit card limit to $10,000. Thats more than enough most of the time

    • R-Man on 19/07/2018 - 14:16

      Yep, forget credit scores and focus on reducing your overall credit limits.

  • ausdday on 19/07/2018 - 13:21

    Just guessing, could be total of your $31,000 max credit card limit at the moment. You need to be really well paid to keep them calm. Usually, when you sign up for a credit card, they will offer you a limit of 1 - 2 month income, and from there, they will offer you credit limit increment based on your repayment.

    ps: I am using Velocity Global Wallet for my overseas spending. The exchange rate isn't the best though. However, they do provide a virtual visa card, that links to your account, and I used that to pay for my stuffs from less trustworthy sites. Anything goes wrong, just delete that card and create a new one.

    • peter05 on 20/07/2018 - 11:19

      this, having such a large availability of unsecured credit is a serious detractor to receiving new cards. It also doesn't scale linearly as if you think about someone leaving the country, the more credit you have the more likely you are to do it!

  • Skramit on 19/07/2018 - 13:27

    Earn more money.

    • jowu15 on 19/07/2018 - 19:20

      Will try and spend less also helps I suppose. I am just wonder whats everyone else's total credit card limit.

  • HighAndDry on 19/07/2018 - 13:49

    My general view is - if even the banks are refusing to give you credit on which they can charge exorbitant rates of interest, you really should 'consider if the product is right for you', as they say.

    But more specifically - it's probably your total amount of available credit. They look at how much other liabilities you can incur, which in your case is $31,000, compared to your level of assets/income. Also if you have any mortgages, other lines of credit, redraw facilities, etc.

    • jowu15 on 19/07/2018 - 19:24

      I have mortgage on my investment properties but not my own house, two credit cards no other debts. Its an online application, so there is no detail about my line of credit, redraw facilities.

  • CyberMurning on 19/07/2018 - 14:00

    come on, if anyone know then we will game the system.
    its like asking who will win world cup 2064

    • [Deactivated] on 19/07/2018 - 16:37
      +1

      who will win world cup 2064

      Djibouti.

    • jowu15 on 19/07/2018 - 19:26

      Where is the transparence of the system.

  • MITM on 19/07/2018 - 14:08
    +1

    Get a Citibank account with a Mastercard DEBIT card. No overseas transaction fees, good exchange rate. No need to apply for CREDIT. Move your money in to the account before making purchases to avoid fraudsters.
    No hoops to jump through like ING and 28 Degrees for feeless banking.
    Let Citibank know which countries you deal with to avoid unnecessary account suspensions.

    • jowu15 on 19/07/2018 - 19:31

      Hi I have a Citibank debit card, but I think its only if I withdraw cash from CItibank ATM there is no charge of overseas atm withdraw fees. They still have international transaction fees, but I also agree with you that i think their exchange rates are good

  • Samsungnote10 on 19/07/2018 - 22:15

    Take my experiences as my experience only, plus i dont work for a bank.

    My credit file is clear of any late payments, defaults or anything of that nature.

    In the past 18 months ive applied for about 9 cards.

    Have been rejected for 3, virgin and citibank and st george.

    I dont have a high income, below the higher income requirements. My total card limits combined are high, i dont know which bank can see which limits of other banks. My last 3 cards my personal income wasnt enough for the minimum but total income including rental income was fine.
    Ive been approved for all those. But the rejected ones, one of them was 35k income requirement.

    Admittedly, ive applied at this bank 3 times in 10 years and being rejected. Ive never been a customer of any of these companies. Maybe there is something about me that these banks dont like about me.

    So you have the option to apply for other banks or wait 3 to 6 months and try again. But each application is a hit on your credit file

    My two cents

    • jowu15 on 20/07/2018 - 15:23

      WOW you very persistent in apply for a credit card in the same bank three time in ten years. I wish you luck if you ever make attempt again. Your experience shows credit card application is not so easy to get seems

  • Sofie519 on 20/07/2018 - 10:16

    Your credit card application is technically an application for an unsecured loan and is assessed on many factors. Including how much existing credit limit you already have.

    $20K + 11K = 31K already in unsecuritized credit. They dont just look at the outstanding balance, but your limit. As you can potentially max that tomorrow. If they gave you another card, say $10k, you can have a 41K debt paying 18%+ interest, which compounds on default. So your income, expenses, existing debt (mortgage) and existing available credit (existing credit limit, homeloan limit - available for redraw) all become factors in the assessment.

    Also if you have a very messy credit file, e.g. multiple credit inquiries on file, you are generally an "auto decline". But most people dont know that they are better off contacting the bank that declined and explaining, working out why, escalating the file for reassessment after the discussion etc.

    As an example IF OP contacted 28degrees, and they told him, the decline was because he already had 31K unsecured credit facility, he can explain that he intended to cancel the "supermarket one, after 28degrees credit was approved" then 28 degrees, might ask him to cancel it first and give them evidence of the cancellation, then the same application would be reassessed and potentially approved. If the OP goes to another lender, the lender sees that 28degrees declined the application, they would red flag, and say, well if another bank didnt approve, they would risk being flagged for irresponsible lending.

    Each lender has a different risk appetite and client profile they are looking for, esp if they are offering a very good deal.

    • jowu15 on 20/07/2018 - 15:29

      This is the best reply, its not only a detailed reply but also provide a remedy. Thanks for take your time and effort to give a detail reply and your valuable knowledge. I am thinking if I should to contact 28Degree to ask why I got knock back.

      • Sofie519 on 20/07/2018 - 17:04

        You definitely should contact them as it would affect your future applications for credit. I can only make assumptions on why you were declined, but it is best to speak and ask them.

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