Denied Credit Card - Unsure Why

NigelTufnel on 03/03/2020 - 14:36

I recently passed my 12 month period for being a new ANZ customer, so decided to apply for the ANZ Frequent Flyer Black Visa card again.
Applied for the card online and was denied. I am unsure why (no details given).

I checked my credit report (first time), and all looks correct. No overdue fees on my other cards. Only issue is it still says I have 1 card that I cancelled last week (I can even see the credit enquiry that got rejected today). Also no mention of my active mortgage, only referenced as an 'Enquiry', not an account.

So I checked my credit score and it says I'm an 'Excellent' - 863.

So why would ANZ reject me?

  • I earn >$75,000/year - not including spouses income.
  • I have an excellent credit score

Could it be as simple as:

  • Putting in a rounded $20,000 as my combined credit limit on other cards, when it is actually $23,200?
  • Typing in a different address format for previous address (Unit 1, 6 Blank St vs 1/6 Blank St)?
  • Different employer in credit report (parent company vs subsidiary) than I put in the application?
  • My estimates for expenses were bad estimates (worked out to ~2,000/month I think)?
  • ANZ just doesn't like me?
  • Any of the above?

How long should I wait before trying to apply again? Or am I better off not bothering and going to a different bank.

Financial Credit Card

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Comments

  • Hybroid on 03/03/2020 - 14:40
    +1

    Any of the above or something else entirely including what your risk profile looks to their algorithm. It's a guessing game and they don't tell you the reason why. You're probably best off leaving it for a while and trying elsewhere.

  • DashCam AKA Rolts on 03/03/2020 - 14:41

    Maybe the bank thinks you're not real.
    https://en.wikipedia.org/wiki/Nigel_Tufnel

    • NigelTufnel on 03/03/2020 - 14:43
      +1

      Must have forgotten to add the value of my guitar collection to my assets.

      • DashCam AKA Rolts on 03/03/2020 - 15:22
        +2

        Maybe the bank turned up your risk level to 11.

  • jjjaar on 03/03/2020 - 14:57
    +2

    There’s usually a phone number to call to discuss. I got rejected once and called and they just asked if I was gonna close existing credit cards (which was a question in the application). When I confirmed I would, I was approved.

    Just call and ask.

    • mbck on 03/03/2020 - 15:05
      +1

      Thats lucky. I remember calling once when I was applying for my first card and they never said anything. In fact they said they couldn't tell me.

      Maybe rules have changed since then(2012)

    • Never Pay RRP on 04/03/2020 - 14:07

      This worked for me too. The first time I called they did not give the reason but I called again and spoke to a different person who gave me the exact reason. I fixed the issue and got the same card I originally applied for (St George).
      So my advice, be persistent (but not rude)

  • Typical16-bitEnjoyer on 03/03/2020 - 15:06
    +2

    There will be a specific formula. You didn't pass. Nobody entry level will be able to tell you, otherwise it would be easy to game the system.

    You already have $23k in credit. Whether these cards are debt free or not doesn't matter. That will be a significant factor.

    • NigelTufnel on 03/03/2020 - 15:18

      Fair enough. I just don't understand how some people on here have so many credit cards, yet apparently I can't even get 3. And I don't think I'm a particularly low income earner.
      Oh well. Might wait a month or so until that 3rd card is actually closed on my credit report (with that on there my combined limit would be above $30,000) and try again.

      • Typical16-bitEnjoyer on 03/03/2020 - 15:37
        +2

        It's $23k to $30k of potential debt. You're a factored risk.

        Don't believe everything people post on here either ;)

        • NigelTufnel on 03/03/2020 - 15:41
          +1

          I presume then if I applied for the minimum credit limit on a new card (or reduced current credit limit on cards) I'd be more likely to be approved?

          • Typical16-bitEnjoyer on 03/03/2020 - 15:47
            +1

            @NigelTufnel: I'm not sure if you're following.

            The dominant criteria in their formula is whether you have capacity to repay the money or, unethically, whether you could potentially service the minimum payments and interest. You already have multiple lines of unsecured credit. You are a perceived risk.

            • NigelTufnel on 03/03/2020 - 16:57

              @Typical16-bitEnjoyer: I thought I was following… My previous comment was how I presume I can lower my perceived risk to banks . Lowering current credit limits so that I have less potential unsecured credit that I might need to service.

              • knobbs on 04/03/2020 - 09:33

                @NigelTufnel: Yes you are correct, lowering you max limit on current cards improves your chances of banks giving you more credit. If that was the criteria you were rejected on anyway

  • MarsTitan on 03/03/2020 - 15:41
    +4

    Recently the rules have changed for the credit card serviceability criteria. Banks have to assume that your combined credit limit could be paid off in two years' time assuming an interest rate of 20%.

    Previously the banks would require you to pay a minimum of 2% each month (which just pays the interest) forever. Thus they could issue huge limits (100K limit will require only 2K per month serving capacity).

    So 40K combined creditcard limit is roughly equivalent to paying off 56K in two years time frame. Which will require a repayment of around 2.3K per month. So assuming you have 2K living expenses you will struggle to service this loan in worst case scenario. As the Black has a minimum credit limit of 15K you may get an auto rejection. Try applying for platinum cards which have lower limits (around 6K).

    This is a recent change effective from Jan of this year. You will see people start to struggle to get high limit creditcards from now on.

    • NigelTufnel on 03/03/2020 - 17:01

      Yeah, that's probably it. I'm mainly confused as I've been approved for credit cards previously with the same sort of combined credit limits, but with lower income and assets. So I would have thought there'd be no problem this time.

  • [Deactivated] on 03/03/2020 - 16:00
    +1

    Had my credit limit increase rejected. A friend who works with banker saw it and told me why.

    They have increased my limit many times. I have never missed a payment. My card is complimentary and I rack up a crapola worth of points. I'm costing them a fair bit (I'm probably still a net profit client). Increasing my limit has no benefit to them.

    You may fall under the same category.

  • scanuck on 03/03/2020 - 16:03
    +1

    Min. $15k limit - would take your potential liability to $38k+

  • Gelato on 03/03/2020 - 16:24

    How long have you been with current employer, combined credit card limit and how much is your monthly mortgage payment?

    Say you’re on $75k annual income
    Your net income per month is about $4,798
    And minus $2k for your expenses
    You’ve about $2.8k for your mortgage and credit card payment calculated at serviceability

    • NigelTufnel on 03/03/2020 - 16:52

      Been with employer >8 years.
      Yeah, I think maybe I also put in total expenses/loans instead of just my share. So there's a mismatch between only my income (and combined household expenses) making it look bad.
      That, combined with the high credit limit combined with already sizeable credit limits.

  • Porker on 03/03/2020 - 16:50

    I'd say your current credit limit ($20k) is a critical factor, as mentioned above.

    It won't matter if you've paid it off or have zero debt against the cards, the fact is you could tomorrow spend big on the cards and then you'd be in debt by that amount.

    Also, that ANZ Black is an expensive card to operate, unless you're after the points / other benefits.

  • bluesky on 03/03/2020 - 17:14

    I recently passed my 12 month period

    Could it partly be due to bank trying to thwart credit card churning, amongst other factors? Came across this article recently.

  • mskeggs on 03/03/2020 - 17:57

    Credit applications show up very quickly.
    Credit account closures seem to take a long time to show up.
    So at the least, the recently closed card is still counting against you.

  • crashloaded on 03/03/2020 - 18:03

    Just get loans from bikies, they will make sure you remain debt free.

  • bloom on 03/03/2020 - 18:58

    I got rejected for one
    Next bank gave me $38k when I only asked for $6k

    Criteria doesn’t make sense :/

    • megadeth on 03/03/2020 - 19:28

      Which bank if you mind me asking?

      • bloom on 03/03/2020 - 20:32
        +1

        Macquarie said no
        Qantas platinum gave a huge limit

        Qantas card is actually Citibank owned and they’re renowned for rejecting a lot of people,

        Don’t bother trying to figure out why and just pick another card

  • chumlee on 03/03/2020 - 19:07

    Maybe they don't want you cause you're a credit card churner

  • megadeth on 03/03/2020 - 19:21

    I've also been denied credit cards by ANZ/Citi/HSBC because banks seem to be cracking down on CC churners. I have approx $176k gross (single income) and currently holding 8 cards (whose limits I've reduced from $74k to $41k for obtaining loan for investment property). I seem to have too many credit enquiries so think i need to wait a couple of years before they vanish.

  • bweiss on 04/03/2020 - 08:50

    I'm intrigued on the high credit card limits people seem to have.
    What's the need for the high limits?

    I'm on around $130k/yr (base), single, and have one credit card with a $2k limit. I do but quite a bit online, and don't typically run into issues with the card limit (excluding hire car excess holds, which is a whole other issue).

    PS: those that mention commercial use are doing things wrong, credit card (i.e. cash) sales don't get you anywhere near the benefits that a commercial credit account with the supplier will net you.

    • NigelTufnel on 04/03/2020 - 09:19

      Honestly, no real reason personally. I haven't sought them out, just send to be what I've been given when getting my credit cards.
      The few times high limits have come in handy is for large family overseas fight bookings, or home Reno's that accept credit cards (kitchen remodel).

    • this is us on 04/03/2020 - 10:52

      That depends on how you use the credit card. I use credit card for everything, from electricity bills to a coffee, and even more expensive things as flight tickets and hotels. I can't find a reason not to use a credit card if I pay exactly the same amount, plus get rewards and more time to pay. Obviously, I always pay the full amount and am organised.

      If I plan a trip today, I might need enough limit to cover my tickets, hotel, and the usual expenses. That's why most people benefit from high limits.

  • OzHunterNSW on 04/03/2020 - 10:26
    -1

    Now take all the information you have splashed about complete strangers and take it down to your bank to the appropriate people seeing a learned and appropriate explanation from the people your issue is with.

  • SnoozeAndLose on 04/03/2020 - 11:56

    Call 13 13 14 and ask for the reason why you got declined.

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