Why did my credit card application get rejected?

Question

I just applied for a 2nd credit card (a store credit card). On the website one of the requirements was that you were already approved for a major credit card.

The letter said rejected because:
-number of recent inquiries on credit bureau report
-excessive obligations in relation to credit limit
-limited credit experience

In Janurary I was approved for a student credit card(Visa through Bank of America). I've paid my bill in full each month, and my average use is $250/month of my credit limit, which is $700. So each month I have not even gotten close to my credit limit.

I just want to know what "excessive obligations in relation to credit limit" means. I understand the other reasons.

Thank you

Answer 1

"income insufficient for amount of credit requested," "excessive obligations in relation to income.



You need to make more money to get more credit.

Answer 2

I would first go to AnnualCreditReport.com: https://www.annualcreditreport.com

Pull your free credit report and take a look at it. It will give you a better understand of how your credit stands, and see if there are any discrepancies such as any unauthorized open accounts.



Excessive obligations simply mean that you have several and too many different accounts open on your credit report. But don't fret; this is a standard rejection for everyone. You most likely didn't qualify do to 'limited credit experience’; however, this is the standard 'legal' talk that they send to anyone who isn't 'qualified'. It covers everything, even if it didn't apply to you.

They saw that you just opened your first account, and didn't want to risk loaning you the credit due to 'their' loaning standards.



But, I would still look at your credit report just to be on the safe side.



I honestly wouldn't do any store credit cards. Their APR's are usually way too high. I would try to apply for a secure card, like a WAMU credit card. They usually have the best rates when it comes to their credit cards, and they are a great company to work with (in my opinion of course). They might have a more relaxed standard which could land you a small $200 lending limit.



Also, you could always first go to your bank and see about applying for a 'Line of Credit' (if applicable). This way you can easily get another revolving line of credit account open on your credit report, and you can start building credit sooner.

Answer 3

You only got a credit card three months ago! You only have 2 months of records on your report. You need a minimum of one year of credit records to get a second card.



You only have a student account. As a student ( as opposed to a graduate with a -- hopefully -- more permanent full-time career) you don't get much credit.



It doesn't really matter that you have never used up all your credit limit on the existing card. $700 is all the credit you likely qualify for since you are a student. Credit is given in relation to your existing income and living expenses, and you probably don't have $700 a month in discretionary income after paying all of your estimated living and school expenses. Therefore, your existing line of credit is excessive in relation to your existing income, and you do not qualify for more credit.



Do not attempt to get another credit card for at least a year. Do not apply for any sort of credit (car loan, student loan, etc) for at least a year. Better yet, finish school and get a full-time job before you apply for any credit again.



Why all the inquiries on your account? Have you been applying for other credit cards? Did you apply for a number of cards before getting the student card? Do you have any student or other loans outstanding or apply for anything? Stop it! Make sure there are no inquiries for at least a year.

Answer 4

Without having pulled your credit report (something you can do anytime you are denied credit for something on your credit report, something most people don't know!) you have no idea what all is on it. If you have had a cell phone bill you let go or just haven't paid off yet, if you are always over your limit on it, someone else may have opened accounts in your name (my own mother opened 14 accounts in my name before I turned 18 and didn't pay a single one! I sued her over it and got her put in jail for credit fraud) or they could have just mistaken you for someone else. If you put in your ssn incorrectly on the website or if your application was in store the rep may have done so & that ssn is what they were looking at. Get your report & find out what is going on. Btw, if you go delinquent on one credit card, did you know all your other credit lines can raise your interest rate to the delinquent level they set? It is in the fine print in every credit application & you agree to them doing this everytime you sign a credit application! Your fun fact for the day.

Answer 5

You can always pull out your own credit report and see how your credit score goes. It gives you all the details that you wanted to know, sometimes creditors avoid with such high balances and delinquencies, sometimes too many inqury like applying for so many credit cards each time can affect your credit score as well. www.truecreditreport.com is one of the best.

Answer 6

well, looks like you're a good creditor. But mostly it depends on the bank, they make sure that you will able to pay your credit even you have another credit card. I would suggest you'll try to apply for another card from another issuer.

Answer 7

For Finance and credit solutions I always recommend this site where you can find all the solutions. http://FINANCEANDLOANS.INFO/index.html?src=5YAofhgdDE281



RE :Why did my credit card application get rejected?

I just applied for a 2nd credit card (a store credit card). On the website one of the requirements was that you were already approved for a major credit card.



The letter said rejected because:

-number of recent inquiries on credit bureau report

-excessive obligations in relation to credit limit

-limited credit experience



In Janurary I was approved for a student credit card(Visa through Bank of America). I've paid my bill in full each month, and my average use is $250/month of my credit limit, which is $700. So each month I have not even gotten close to my credit limit.



I just want to know what "excessive obligations in relation to credit limit" means. I understand the other reasons.



Thank you

Update: ok, thank you everyone for all the side notes.



can someone please tell me what "excessive obligations in relation to credit limit" means



thanks

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