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What To Do If Your Credit Card Application Is Denied

by Jason Steele

For those with good credit, it can be a huge shock to be denied a credit card. The reasons given by the bank for your denial can range from plausible to laughable. Fortunately, a denial letter is not the final word in the process.

How You Get A Denial Letter

Have you ever been in the position of having to evaluate stacks of applicants? Perhaps you have received resumes or have been the judge of a contest. The more applicants you review, the more your think about creating a system that could automatically assess each applicant and make a decision for you. That is precisely how banks review the thousands of credit card applications that they receive each day. Their financial people work with their systems developers to create an automated set of criteria that will determine the fate of your application. Your credit score is undoubtedly a major component, but there can be many other factors. These criteria can include existing accounts with that bank, recent applications for credit, and even demographic patterns that the bank feels will affect your credit worthiness.

Consider Reconsideration

Thankfully, you can “appeal” your decision to a human. By contacting the bank, you can speak with a customer service representative that may have the ability to over-ride the computer’s judgement. This process is called reconsideration. You may either write a reconsideration letter or simply make a phone call. The purpose of the communication is to provide additional information that will supplement your original application. You may ask the bank to consider your history of good payment to your other accounts, or to consider other forms of income that were not asked for on the application. If your financial situation has changed for the better since you submitted your application, you may wish to revise it. For example, you may have paid off a credit card or a loan, or perhaps you have received a new job or a raise.

Another tactic you can use to get a bank to reconsider a credit card application is to ask for a credit line adjustment. For example, if you already posses a card from that bank, you may ask that they reduce the credit line of that card and re-allocated it to the new account. In this way, the bank is not really granting you new credit and they will have less reservations about approving your account.

Why You Would Want Reconsideration

The credit card industry is getting to be extremely competitive. New card offers are entering the market at a ferocious pace. The only time I have ever been denied a card was for the first 100,000 British Airways offer. It turns out that I had only recently received another card from Chase, and their computers determined that I was ineligible to receive this card. While my reconsideration effort was a failure in that circumstance, I at least gained some experience with the process.

When To Ask For Reconsideration

While many people wait until they have received a rejection letter, others report success in contacting the bank any time they do not receive an instant approval. Technically, this may only be “consideration” rather than “reconsideration”, but the result is the same; people contacting their bank are able to obtain instant approval by successfully convincing the right person that their application is worth approving.

Conclusions

Modern banking systems are highly automated, yet there is still a human element left in the process. By attempting reconsideration, applicants have nothing to loose. When an credit card offer is just that good, and you really can’t explain why your application was not accepted, you should always take the extra step to contact your bank.

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