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10 Reasons You Were Rejected for Credit

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Serious delinquency, derogatory public record or collection filed

Image: Zach Klein

What it means: This can mean your credit report includes a bankruptcy, judgment, tax lien or collection account. Bankruptcy remains on your report 10 years from the date you file (7 years for a completed Chapter 13); paid judgments can be reported for 7 years but unpaid judgments can stay on there even longer; paid tax liens are removed 7 years after being paid, but unpaid tax liens can remain on your report indefinitely; while collection accounts may be reported seven years and 180 days from the date you first fell behind with the original creditor leading up to the account being turned over to collections.

What you can do about it: If the information is accurate, then this is also a matter of biding your time and making sure you have as many positive credit references currently reporting as possible. (A secured card may be an option if you can’t qualify for a regular credit card.) And while paying a collection, judgment or tax lien won’t likely change this factor in the short run, it could result in the public record item being removed from your report sooner, and protect you from being sued for a debt which could result in additional judgments or collections on your credit reports. If dates are incorrectly reported or payments are not being reported — not uncommon with collection accounts — dispute them.

[Free Resource: Check your credit score and report card for free before applying for a credit card]

Reason 7: No recent revolving balances (or no recent bankcard balances) »

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  • Bill

    It seems almost impossible to be approved, there are soo many hoops you have to jump thru and I am beginning to feel as if they are looking for reasons NOT to approve you rather than doing anything to help an individual! It seems like such a racket that you don’t have much control over, yet it has all the control over your life! Just doesn’t seem fair!

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  • Be-Be Gee

    What’s all this about why you’re rejected – each reason is sometimes contradicting the other – to much credit, not enough credit, to recent inquiries, not enough recent balances. All the lenders play games and pick & choose who they want to approved and deny. A lender gives you a $5,000 limit, but penalizes you if use the limit, by lowering your credit score. If you dont want the consumer to use that amount don’t grant that amount. But I thought it was given as as option to use as long as you’re making at least mimimum payments on-time. Knowing this, what do you do not use the cards and then you;re penalize againg for not using (no history of payments)

  • http://M.S.N. michal flansburg

    IT all boils down too this and what america was based on Trust , we have no more trust just more greed, too many hard working americans are being taken advantage of and its gotta stop. We working americans can pullout of these hard times if given a chance ie a little bit of credit. sincerly yours michael

  • tran

    I have perfect rating on Discovercard, I pay off ALL balance each month with them for 3 years, I paid on time 100% with them for 3 years. When I asked DISCOVERCARD for a credit increase, they promtly denied me because they said I have a low credit score…based on TransUnion, Experian, Equifax credit report. WTF????

    • 2007 Brittney

      They can that having skikky crdit, and yes its bull. I used to buy everything cash until i applied for a credit card and found out i had no credit. I had to prove to discover i had 100k in the bank for them to give me a tiny $1,500 credit card.

  • Lisa Marie Walsh

    I don’t have any credit or current revolving accounts and I got denied because %balance on revolving accounts too high? Why or how is that possible? My credit score was 635 was or is that bad?

    • http://www.credit.com/ Credit.com Credit Experts

      Lisa —
      If you have no revolving accounts, it is hard to understand how the credit utilization on them could be too high. As for your score, it will depend on the scale used. In many commonly used models, it would be considered “fair” — good enough for some cards but not others. Because applying for credit results in a small, temporary drop in your score, we recommend applying only for cards you’re relatively confident you’ll be approved for. Different cards are marketed to people in various score ranges. A credit card comparison tool like this one can help you identify the cards you’re likely to qualify for.

  • catdogme

    I want to transfer my balances over to a 0% balance transfer card so I can pay my debt down faster, but when I apply, they all say my balances are too high. THAT’S WHAT I AM TRYING TO FIX!!! I have no late payments on anything, etc. etc. I pay as much as I can but the interest is making it REALLY SLOW. What can I do?

    • http://www.credit.com/ Credit.com Credit Experts

      One possibility is to call your current card issuers and request a rate reduction. It may not help, but it can’t hurt. And you can check your free credit score, which also contains information on the factors that are responsible for it — and a guide for what you need to do to improve. your scores. Also be aware that applying for cards, whether you are approved or not, can cause a small, temporary drop in your scores. So you want to be relatively confident that your application will be approved. Also, know that the balance transfer cards do not allow you to transfer cards from the same issuer.

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