Refused a credit card for having an old student credit card

mithrandir63 · 21 November 2009 at 10:46PM

Hello,

After spending 2 hours organising my first mortgage at the Bank of Scotland, my mortgage advisor referred me to a colloeague to arrange an ultimate reward current account (for the added perks when combined with a mortgage).

Once the current account was sorted, the accounts advisor suggested that I might as well apply for a 0% interest (for 12 months) credit card, since the credit card I currently have is very old. I asked if the application for a new credit card would affect my mortgage application, and she said it shouldn't since I am currently eligible for a personal loan anyway. I decided to go ahead with the application thinking there was very little risk, however when she called for a decision on the 0% card, it was refused on the grounds that my current credit card is an old student card (I have kept it since 2002 to help build my credit score).

I had no idea that BoS refuse credit on these grounds, and would have cancelled my old card before applying for a new one if I had known. Pretty annoyed I asked the advisor if this rejection would affect my ability to get credit, but she again said that it shouldn't and that if I still want the 0% card I could come back once I cancelled my old card.

I have now checked my experian credit report and can see that even though I didn't sign anything, there are two BoS searches logged already relating to a credit card (which I presume will show as rejections) as well as my mortgage application. Having spent a long time building an immaculate credit history (no problems paying previous debts with an experian score in the mid 900's) I am now concerned, and pretty furious that being rejected for a credit card on such a silly technicality could damage my credit score.

Should I do as advised and return to the bank to re-apply once I have cancelled my student card, or do I need to wait for 6 months? Is there anything I can do to highlight to potential lenders that todays rejection was nothing to do with a bad credit history and simply due to an arbitrary Halifax/BoS policy?

Joe_Bloggs · 21 November 2009 at 11:07PM

Relax. Take a deep breath. You didn't want another credit card before they suggested it was possible. Get to grips with the awesome burden of a mortgage!

I am sure the staff were trying to be helpful but clearly they have never been in your situation and could not have known the perverse nature of their own credit card approval system.
J_B

NickX · 22 November 2009 at 2:06PM

mithrandir63 wrote: »

I have now checked my experian credit report and can see that even though I didn't sign anything, there are two BoS searches logged already relating to a credit card (which I presume will show as rejections)

Don't worry too much about this. Other lenders will see the search but they don't know that it was a rejection. A single application for credit will make no difference to the strength of your credit file. The fact it was rejected is irrelevant.

As above, you are no worse off than before, and if you do want a credit card there are plenty of other providers out there who are likely to accept you.

izools · 22 November 2009 at 3:02PM

Indeed, your credit score shouldn't be affected, it certainly won't impact on your mortgage application, it is more likely due to in house rules regarding BoS / Halifax not allowing a customer to hold a student credit card and regular credit card simultaneously. Most banks have a similar policy.

If you still want a 0% card it may be an idea to go elsewhere, as a 3rd party creditor won't be able to tell what kind of credit card you already have, just the fact that it is a credit card.

It is always advisable to take out any credit facilities you may need before you move, as after you move your credit score takes a big hit until you've been on the electoral at your new address for a year or two.

Good luck, and keep us posted

-P.S. Barclaycard and Sygma Bank search Equifax - and as such won't see the credit searches BoS did on your Experian file - so will be even more likely to give you a line of credit without wondering why two credit card applications are on your file

mithrandir63 · 22 November 2009 at 7:23PM

Thanks folks. I was just panicking having already sealed my doom with the mortgage (big step since my wife and I are both the first in our families to own property).

I will probably cancel the old card anyway and apply for a 0% card elsewhere since it would come in handy for buying furniture.

Thanks again!

Refused a credit card for having an old student credit card

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