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I tried applying for a new credit card, as the only one I had strangely jumped from 2% to 35% APR unexpectedly, without any reason I could tell, and customer service was unhelpful. I plan to cut the current one and replace it with another with 12-15 months with 0% APR.

But each application I've made they've rejected. When I took it up with management, they said Experian checked my credit, didn't like what they saw. But (a) I haven't missed any payments since ever and (b) my own credit checks reveal I have a FICO score of 850.

Are there some other variables besides the FICO score Experian would reveal that would make them reject a card application? I used to get credit card offers in the mail daily. Is there some reason I can't even get a credit card now?

Update: I confirmed by creating an account with Experian that my credit score is very good and that there is no unusual or suspicious activity affecting my credit. A car dealer also showed me scores from all three companies. Not all at 850, but three scores were all quite high, each near the maximum on the scale.

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    Where did you get your FICO score from? A score of 850 seems unlikely.
    – Ben Miller
    Apr 25, 2023 at 2:01
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    If you can pay it off in the next paycheck, why are you worried about the interest rate? Pay the balance, use it only when absolutely necessary (maybe use cash when travelling?) And stop worrying about the interest rate.
    – D Stanley
    Apr 25, 2023 at 2:11
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    What country are you in? Laws differ from place to place.
    – littleadv
    Apr 25, 2023 at 3:01
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    Just fwiw: note that a "pre-approved" card offer mostly means someone approved sending you the advertising, not that you are actually mire likely to be approved for the card. Ignore that word
    – keshlam
    Apr 25, 2023 at 16:02
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    850 with just 1 credit card? I doubt that. Experian's advice for a perfect credit score is at least 5 open accounts in good standing. Perhaps what is really going on is someone has been using your info and was paying the CCs which got you to 850, and now they aren't paying. Check your detailed report at any of the 3 credit bureaus' websites. Since you mentioned Experian, start there.
    – rtaft
    Apr 25, 2023 at 23:31

4 Answers 4

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You are probably being declined for the same reason your interest rate spiked. Contact all the credit rating agencies and ask for a copy of your report; in the US they're each required to give you one free copy of their data each year on demand. It's possible that one agency is rating you very differently from the others and that happens to be the one that's causing trouble.

Note that if you have locked your credit report for security, that will prevent new credit from being issued. You may need to unlock it briefly, or for a specific query, while your application is being processed.

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    Unless the OP has done something obvious (like not repaying a loan on time), I'd be thinking about identity theft.
    – Pete
    Apr 27, 2023 at 9:58
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    @Pete: Certainly worth checking. Which, again, means you want to get the reports and see if there's anything that doesn't make sense.
    – keshlam
    Apr 27, 2023 at 10:14
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From one of your comments:

It would take next paycheck (1/2 of month's pay) to pay off current credit card amount to $0. The only reason I keep using it, is using debit card is dangerous, I'm traveling a lot, don't want to risk using debit card when overseas or out of state. But the credit card keeps adding fees each month I don't like.

When you carry a balance there is no grace period. Every time you use the card, that transaction is added to the balance that is charged interest.

But if you pay off the balance to zero, then in a month or two the amount being charged interest will be zero. From then on you won't be charged interest as long as you pay off the amount you owe as listed in the statement.

If you keep lets say an average balance of $2,000 at that quoted 35% you will be charged around $58 a month in interest.

You need to get your balance to zero. Then you need to discover why the rate jumped. Read everything connected to that credit card: did a promotional rate end? did you miss a payment?

It is also possible that there is a mistake in your credit file. You need to get a copy of the credit report to see if there is something incorrect, or something you missed. Don't just get the score, look at the entire file.

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    Right. It's fine to use a credit card for the insurance and liability protections but that means paying it off completely, every month (I usually pay off my credit cards twice a month.)
    – JimmyJames
    Apr 25, 2023 at 16:48
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    This is the key. I have no idea what the interest rates on my credit cards are. Because it doesn't matter! You just pay them all off every month, and there's zero interest.
    – codeMonkey
    Apr 25, 2023 at 19:28
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    @codeMonkey: Same here pretty much. I've paid interest a few times by mistake. Only time I complained was when they wanted several dollars interest on 94 cents. On the other hand while several dollars interest on twenty dollars (I misread the bill) is steep it was not worth being a pain about.
    – Joshua
    Apr 26, 2023 at 1:45
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    "When you carry a balance there is no grace period. Every time you use the card, that transaction is added to the balance that is charged interest." I think this is an oversimplification. On the two main cards I use, there is no need to take the balance all the way to zero as long as the total of payments made before the due date meets or exceeds the prior month's statement balance. That is, in one sense, the same as paying it off, but in another sense, it isn't, because on any given day, the account balance is never all the way down to $0, yet I pay no interest. Apr 27, 2023 at 3:06
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    @Michael-sqlbot You pay the statement balance to zero. It doesn't matter if something more has come in since the statement date. I'm like codeMonkey--no idea what the interest rate is because I don't ever carry a balance. May 1, 2023 at 2:48
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You have a number of helpful rights that you can assert any time that you are denied credit. The Equal Credit Opportunity Act requires creditors to explain to you exactly why you were denied credit or why the terms of your credit got worse. The Dodd-Frank Act added to this the requirement that the creditor provide the customer with a copy of the information they used to make their decisions, for certain types of loans. They will not necessarily give you this information automatically, you have to contact them and specifically request it.

Also, when your credit application is denied, the lender will send you an "adverse action notice". This notice includes information about which credit reporting agencies they got information from. Once you get this notice, you can contact the agencies listed on the notice and request free copies of the credit information that they supplied the lender. This is on top of the free annual credit report that you're always entitled to.

Any time you're denied credit or the terms of your credit change, it's a good idea to collect as much of this decision data as you can. You don't just want to know your credit score, you want to see the entire credit report. On the last credit report I received, it has sections that specifically listed the good factors that improved my credit score the most as well as the bad factors that hurt it the most. That will likely point you towards what caused your recent denial. Verify that all the information on the report is accurate and up to date. If you've paid off a past debt, make sure it shows up as paid and not as still active (some lenders are bad about not reporting loan payoffs in a timely manner). Even something as simple as a typo on one of your previous addresses is enough to potentially cause problems later. If you see anything that's not correct, contact the credit bureau ASAP and they'll correct it with all three bureaus for free. You need to act fast, though, because some of these free reports are only free if you request them within 60 days of when you originally applied for credit.

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If you have a high score with no missed payments then most likely the problem is one of these two:

  1. You recently applied for credit cards or other loans. I opened three credit cards in January of this year (for sign-up bonuses). I was then declined for a fourth and later a fifth card. They cited "too many new recent inquiries" and "age of accounts is not long enough". The new accounts required a hard pull each and drastically lowered my overall age of accounts. For reference, by score went from 830 to 805.
  2. Your credit is locked. Did you contact the credit bureaus to lock your credit ever in the past? If so, you will have to "unlock" it before applying for more cards or loans.

As keshlam suggested, pull your credit report (either directly from the bureaus, annualcreditreport.com, or Credit Karma) and see if you have anything that might stand out.

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