Multiple Credit cards applications 'challenge/study'

Alexsas

Having read this forum a lot, and being a silent listener, I thought I'd share my recent experience that might be a useful contribution to collective wisdom.


The background to this application is that we completed on the mortgage on 15/07/2016, and I did not want to risk that by card applications before that, therefore most of my applications were on the 15/07.

That is not the most orthodox approach to applying - but we needed some money for the new house and to pay off some of my wife's cards where 0% deals were ending.

On top of that I decided to take on a challenge on how much the one can get and to test how multiple applications impact your credit rating.

The essence of the story is that multiple applications don't have impact: I made 12 applications, out of those two were rejected, 9 accepted, and 1 I have never heard back from.

My overall credit history is very good (no late payments, a few cards live and closed, one mortgage). Largest credit limit was £32k, and couple of others around £20k, with very low utilisation of credit (outstanding debt was £5k) so it was a relatively good picture before I started.

Below I will summarise my experience with various lenders, as none of them were the 'same':

15/07/2016 Tesco personal finance limited; £10k limit.

approved online, didn't ask for anything in the, took them about a week to send the PIN and the card out.

15/07/2016 Bank of ireland (AA Cards); £5.5k limit

these were the biggest PITA to apply. It is almost a month since application but still have not received the card (they confirmed approval on the phone). After 7-10 days of application they sent a letter asking 4 pieces of documentation (there are threads on here about this madness - as they asked more than Halifax asked for my 500k mortgage!). Then they sent another letter claiming I didn't send them the original: I had to challenge that and they finally accepted. Looks like the process takes 4-5 weeks with them.

15/07/2016 Nationwide building society
Refused straight away, have no idea why.


15/07/2016 Mbna limited; £25k limit
Online thing went into 'we need to think about it'. I almost forgot about application when suddenly found £10k more in my current account (I gave details for a money transfer when applying). The card and PIN arrived in 7-10 days. No documents or proves were asked.


15/07/2016 Clydesdale bank; £5k

This is yet another one stuck in the stone age. Send you hand typed correspondence (were typos in my name) asking to call them, when you call they ask you to send documents (at your expense!), then send you another set of documents to sign and send back (again, at your expense). Entertained their process out of sporting interest and got the card....

15/07/2016 Cooperative bank plc - black hole.
These are mysterious bunch. Never heard back from them. Called them out of principle and they told me they asked for more documents in a letter that never arrived. I faxed them the documents they asked for, but again never heard back. Might call them again if I have nothing else to do in the evening.


15/07/2016 Sainsbury's bank plc - £10k limit.

The process took two weeks or so - they wanted me to return the signed credit agreement - which they dispatched rather quickly, on the 2-3rd day after the application. The card took long to arrive.

15/07/2016 Lloyds bank (was lloyds tsb bank) - £2k limit.

This was the fastest card to get. APproved online, and card with PIN were with me in 3-4 days.

19/07/2016 Halifax credit card - rejected.

29/07/2016 Virgin - approved, limit unknown.
Asked for the driving license photocopy to be sent to them, waiting for them to come back with something.


30/07/2016 Santander cards ltd (abbey) - 12.5K limit.
Applied out of scientific interest. Got approved immediately and could do balance transfers straight away in my online banking. Card arrived within a week. very slick and pleasant process.

01/08/2016 Bank of scotland credit card - £6k limit.

this is very frustrating process. Approved online subject to 'id check'. Called them to tell I have a current account and mortgage with them - why do they want ID check. THey told me 'computer says so'. Fine. Having spent 40 minutes in the queue in the branch, keep calling them every day to be told they have not received it in the processing centre. Tomorrow is the deadline when i can raise formal complaint, and they won't lift a finger before that.

Alexsas

My conclusion of this little experiment is that the lenders don't care that much about number of your applications (i had around 12 when approved for my last card).

what seems to count is your overall limit utilization (it's bad if you are maxed out).

they don't mind you having multiple accounts open (I had 4 open credit cards and 5 current accounts with overdrafts before the process)

More than happy to answer any questions on aspects of particular banks I dealt with and in general

sjbrun

The difference is not everyone has a 500k mortgage or the income to get one to get those kind of cards.

Those circumstances are indervidual to yourself.

Alexsas

sjbrun wrote: »

The difference is not everyone has a 500k mortgage or the income to get one to get those kind of cards.

Those circumstances are indervidual to yourself.

that is true, but there could be some general trends as well. 500k mortgage is very new (the old one was £115k when i was applying). One of the lessons I learned is that Experian credit score is more or less 'indicative' on what lenders might think: e.g. i could not get extra card when credit limit use was very high, or when I have a few recently opened accounts - and after a new mortgage and new credit cards with more debt appeared on my account, the experian rating went from 'Excellent' to 'very poor' - which seems to reflect my previous experience in obtaining credit.

Winrick

Thanks for this Alexas. Very useful perhaps as an indicator of the length of application process and perhaps generosity for various cedit card providers regarding limits.

I would however caveat your conclusion that "lenders don't care about the number of applications". It's not the they don't care. The key part of your experiment is that you did all these applications on the same day and hence there wasn't enough time for each lender to update your credit file with the your latest application search. Assuming that the credit report takes at least 1 day to update (but realistically at least a few days), then at the time of each application they were looking at your credit report from the previous day so they didn't know of your recent applications. I suspect that had you spread out your applications to day one per day then your success rate would be much lower than 9/12 and the last applications would have had much less success than the first.

And as you may have hinted at later in your post, your credit rating subsequently took a bad hit after all these credit cards were opened.

It is not clear if you just kept these cards open but not using them or are doing large balance transfers on all them. If it is the latter then be careful that your balance transfer periods don't end at the same time and you find that you cannot open any other cards to transfer to as you already have so many open.

However the main thing is that you timed it right just after your mortgage so I'm guessing you have at least 2 years for your credit rating to improve before you remortgage.

It was am interesting experiment and I appreciate your sacrifice but please be careful and I would recommend that you perhaps close some cards over the next 2 years or so to allow you to balance transfer your MBNA debt when the time comes and remortgage if you need to.

Sorry for the long post.

eskbanker

sjbrun wrote: »

The difference is not everyone has a 500k mortgage or the income to get one to get those kind of cards.

Those circumstances are indervidual to yourself.

^ This - to borrow from 'Life of Brian', we are all different, so it isn't realistic to extrapolate from one (apparently) wealthy person's experiences.

The CC companies each have their own unpublished profiles of target markets and risk analysis methodologies, based on a large range of factors and metrics, so even if someone else existed with the same level of income as OP, the same credit limits and the same Experian score, that's no guarantee that the card companies would respond in the same way.

So, while it's sometimes interesting to read of peoples' experiences, it's not really valid to draw the conclusions in post #2 as if they were from a scientific experiment or to believe that they're symptomatic of general trends....