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  • FIRST POST
    • shopaholicno1
    • By shopaholicno1 5th Feb 18, 11:09 AM
    • 129Posts
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    shopaholicno1
    Preapproved for credit card-being considered?
    • #1
    • 5th Feb 18, 11:09 AM
    Preapproved for credit card-being considered? 5th Feb 18 at 11:09 AM
    I just applied for my first credit card. I am 31 with a good credit history.
    I chose the Virgin credit card as it said I was pre approved. However, at the end it said;

    Thank you for applying for a Virgin Credit Card. We are considering your application based on the information you have provided, and will be in touch again soon. You will usually hear from us in the next 7-10 days.

    I assumed pre approved meant a definite yes. Is this normal? Am I going be rejected?
Page 1
    • zx81
    • By zx81 5th Feb 18, 11:17 AM
    • 16,804 Posts
    • 17,813 Thanks
    zx81
    • #2
    • 5th Feb 18, 11:17 AM
    • #2
    • 5th Feb 18, 11:17 AM
    Perhaps. Perhaps not.

    Or perhaps approved with a tiny limit, if it was a genuine pre approval.

    Either way, wait and see.
    • Candyapple
    • By Candyapple 5th Feb 18, 11:27 AM
    • 2,849 Posts
    • 2,174 Thanks
    Candyapple
    • #3
    • 5th Feb 18, 11:27 AM
    • #3
    • 5th Feb 18, 11:27 AM
    When I applied with Virgin I did the eligibility checker on their website and was pre-approved and when I went through with the application the final page said something along the lines of success and card will be with you in x-amount of days, but basically it was't the message that you got.

    If this is your first credit card, it could be that they are running some extra checks on you. If you can, report back to this thread with an update on what the outcome is - it's useful info to refer to others who may be in the same situation as you in the future.
    I'm a Board Guide on the Credit Cards, Loans, Credit Files & Ratings boards. I'm a volunteer to help the boards run smoothly, and I can move and merge threads there. Any views are mine and not the official line of moneysavingexpert.com
    • shopaholicno1
    • By shopaholicno1 5th Feb 18, 11:35 AM
    • 129 Posts
    • 474 Thanks
    shopaholicno1
    • #4
    • 5th Feb 18, 11:35 AM
    • #4
    • 5th Feb 18, 11:35 AM
    I'll definitely report back with an update.

    Frustrating if I'm rejected, as I only want it to help my credit score for a mortgage in future, not to make my credit worse!
    • Gary_Dexter
    • By Gary_Dexter 5th Feb 18, 11:41 AM
    • 1,130 Posts
    • 627 Thanks
    Gary_Dexter
    • #5
    • 5th Feb 18, 11:41 AM
    • #5
    • 5th Feb 18, 11:41 AM
    I'll definitely report back with an update.

    Frustrating if I'm rejected, as I only want it to help my credit score for a mortgage in future, not to make my credit worse!
    Originally posted by shopaholicno1
    Your not boosting your score but your credit history.

    The score is a meaningless number that no one sees
    • zx81
    • By zx81 5th Feb 18, 11:46 AM
    • 16,804 Posts
    • 17,813 Thanks
    zx81
    • #6
    • 5th Feb 18, 11:46 AM
    • #6
    • 5th Feb 18, 11:46 AM
    Also, only the search will show, which is the same whether accepted or rejected.
    • adindas
    • By adindas 5th Feb 18, 11:48 AM
    • 3,528 Posts
    • 2,192 Thanks
    adindas
    • #7
    • 5th Feb 18, 11:48 AM
    • #7
    • 5th Feb 18, 11:48 AM
    When I applied with Virgin I did the eligibility checker on their website and was pre-approved and when I went through with the application the final page said something along the lines of success and card will be with you in x-amount of days, but basically it was't the message that you got.

    If this is your first credit card, it could be that they are running some extra checks on you. If you can, report back to this thread with an update on what the outcome is - it's useful info to refer to others who may be in the same situation as you in the future.
    Originally posted by Candyapple
    Applied their 0% Interest for 32m on BT with 0.6% fee. Although I have more than 10 saving accounts with them they are still asking me for proof of ID and address. Anyway I sent to them but still wait for the decision.
    • AllieKat
    • By AllieKat 5th Feb 18, 1:23 PM
    • 91 Posts
    • 57 Thanks
    AllieKat
    • #8
    • 5th Feb 18, 1:23 PM
    • #8
    • 5th Feb 18, 1:23 PM
    This has been far oversimplified. Scores aren't meaningless... But the score you buy is very unlikely to be exactly the same model as the one a lender uses.

    But you can still improve the scores lenders use. Sadly you'll never see what it is, but if you follow good habits, you'll improve your score in their scoring models.
    • Gary_Dexter
    • By Gary_Dexter 5th Feb 18, 1:32 PM
    • 1,130 Posts
    • 627 Thanks
    Gary_Dexter
    • #9
    • 5th Feb 18, 1:32 PM
    • #9
    • 5th Feb 18, 1:32 PM
    This has been far oversimplified. Scores aren't meaningless... But the score you buy is very unlikely to be exactly the same model as the one a lender uses.

    But you can still improve the scores lenders use. Sadly you'll never see what it is, but if you follow good habits, you'll improve your score in their scoring models.
    Originally posted by AllieKat
    And achieve nothing at the same time
    • DCFC79
    • By DCFC79 5th Feb 18, 1:58 PM
    • 31,606 Posts
    • 19,946 Thanks
    DCFC79
    This has been far oversimplified. Scores aren't meaningless... But the score you buy is very unlikely to be exactly the same model as the one a lender uses.

    But you can still improve the scores lenders use. Sadly you'll never see what it is, but if you follow good habits, you'll improve your score in their scoring models.
    Originally posted by AllieKat
    Scores are meaningless as far as lenders are concerned since they don't see them. The score is just a representation of how your credit report is but it might not be entirely accurate.
    Can people stop loaning money/being a guarator to family/friends, it rarely ends well and you lose out as your money is gone or you get shafted with being a guarantor.
    • DCFC79
    • By DCFC79 5th Feb 18, 2:00 PM
    • 31,606 Posts
    • 19,946 Thanks
    DCFC79
    I'll definitely report back with an update.

    Frustrating if I'm rejected, as I only want it to help my credit score for a mortgage in future, not to make my credit worse!
    Originally posted by shopaholicno1
    What's on your credit report ?
    Any negs ?

    Rejections aren't on your report, just the search.
    Can people stop loaning money/being a guarator to family/friends, it rarely ends well and you lose out as your money is gone or you get shafted with being a guarantor.
    • AllieKat
    • By AllieKat 5th Feb 18, 2:15 PM
    • 91 Posts
    • 57 Thanks
    AllieKat
    Again it isn't that simple. Most lenders *do* use a scoring model internally. Granted, it won't be identical to the ones consumer credit report sites use, but the basic inputs and weighting are quite similar. Improve your score on the consumer credit report sites and you'll improve your internal scoring with most lenders.

    The scores aren't meaningless like so many on here like to claim. They're based on similar models to what lenders use and thus give you a good general idea where you stand.
    • BorisThomson
    • By BorisThomson 5th Feb 18, 2:24 PM
    • 1,586 Posts
    • 3,420 Thanks
    BorisThomson
    Again it isn't that simple. Most lenders *do* use a scoring model internally. Granted, it won't be identical to the ones consumer credit report sites use, but the basic inputs and weighting are quite similar. Improve your score on the consumer credit report sites and you'll improve your internal scoring with most lenders.

    The scores aren't meaningless like so many on here like to claim. They're based on similar models to what lenders use and thus give you a good general idea where you stand.
    Originally posted by AllieKat
    Given that you can be rejected by one lender and accepted by another based on identical data, we can be certain that the weightings are not quite similar.

    Unless you have access to the lending algorithms for most lenders to confirm your assertion?
    • shopaholicno1
    • By shopaholicno1 5th Feb 18, 3:03 PM
    • 129 Posts
    • 474 Thanks
    shopaholicno1
    What's on your credit report ?
    Any negs ?

    Rejections aren't on your report, just the search.
    Originally posted by DCFC79
    Nothing really negative-the only negative is saying I don't have a credit card! I have two credit store accounts in good standing with low balances. Had them 7 years. So I do have a history of good borrowing, no defaults etc

    I'm wondering if the likely cause is that I recently (successfully) switched banks. This was a hard search, but it wasn't for credit?
    • Ebe Scrooge
    • By Ebe Scrooge 5th Feb 18, 3:05 PM
    • 4,127 Posts
    • 3,569 Thanks
    Ebe Scrooge
    Again it isn't that simple. Most lenders *do* use a scoring model internally. Granted, it won't be identical to the ones consumer credit report sites use, but the basic inputs and weighting are quite similar. Improve your score on the consumer credit report sites and you'll improve your internal scoring with most lenders.

    The scores aren't meaningless like so many on here like to claim. They're based on similar models to what lenders use and thus give you a good general idea where you stand.
    Originally posted by AllieKat

    OK, so please explain why the CRA will lower your score in response to any change in your credit situation ? Win the lottery, pay off your mortgage - hey presto, your score drops.


    Yes of course, all lenders have their own internal - and confidential - algorithms that will generate an internal score based on your credit history. This will have little if anything to do with the score made up by the CRAs. Quite apart from anything else, each lender will have a preferred target customer base. You could be very frugal with money, have never defaulted on anything, have 1000 stashed away in a savings account, and manage very nicely day-to-day on your average salary. But I bet Coutts wouldn't be interested in offering you a product.


    You could be up to your eyeballs in debt and living off credit, barely having enough to buy a loaf of bread each week. Many of the mainstream lenders would refuse to lend to you, whereas the like of Wonga etc. will be happy to lend you more.


    The point being, every lender has their own, very different, criteria. So the score made up by the CRAs cannot possibly be representative of anything.
    I may not know much about art, but I know what I like.
    • MABLE
    • By MABLE 5th Feb 18, 3:07 PM
    • 3,515 Posts
    • 1,838 Thanks
    MABLE
    If there are any differences on the eligibility checker online form and the application form you submit to the credit provider then this would result in an application being referred.
    • Gary_Dexter
    • By Gary_Dexter 5th Feb 18, 3:34 PM
    • 1,130 Posts
    • 627 Thanks
    Gary_Dexter
    Again it isn't that simple. Most lenders *do* use a scoring model internally. Granted, it won't be identical to the ones consumer credit report sites use, but the basic inputs and weighting are quite similar. Improve your score on the consumer credit report sites and you'll improve your internal scoring with most lenders.

    The scores aren't meaningless like so many on here like to claim. They're based on similar models to what lenders use and thus give you a good general idea where you stand.
    Originally posted by AllieKat
    You're correct - lenders do use their own internal scoring system, but this is in no way linked or related to the mythical marketing number you see on your reports.

    They don't give an indication on how good or bad you are - you could clear a debt or default of a few thousand pounds, closing the account, and your score would plummet, despite clearing the debt.

    Explain that
    • AllieKat
    • By AllieKat 5th Feb 18, 5:25 PM
    • 91 Posts
    • 57 Thanks
    AllieKat
    Given that you can be rejected by one lender and accepted by another based on identical data, we can be certain that the weightings are not quite similar.

    Unless you have access to the lending algorithms for most lenders to confirm your assertion?
    Originally posted by BorisThomson
    Similarity isn't equality. I didn't begin to claim they were equal, merely that over a large enough statistical dataset, the models being sold to consumers do, generally, mean something in regards to being *similar* to how most lenders will score your credit report. In some cases, it actually might be identical (if the lender buys the score as-is, though this is less common in the UK than in some other countries).

    But remember, lenders are scoring your *application* not only on their score of your credit report but on other factors as well, which may include but definitely aren't limited to:
    - Length of employment
    - Income
    - Stability of employment (thus why they ask if you expect any reduction in income)
    - Cost of your housing
    - Anything they perceive as a risk factor they can legally consider (remember some protected characteristics would be unlawful discrimination to consider)
    - Potential profitability

    The last one is *huge* and might be very different from how you expect. Some lenders are known to consider excellent scoring credit files as a negative on potential profitability... they are fee-chasing, and you're less likely to pay fees!

    Changes, even seemingly good changes, indicate instability and are likely to result in short-term drops in how a credit file is scored, so that seems pretty accurate to me.

    I'm not saying you should treat consumer credit scores as gospel. But I also think it's dangerous to say 'oh, it's not identical to what lenders use, so you should just ignore it'. Be sensible, treat your credit well, PIF before any interest charges, etc and I think you'll generally find both your consumer scoring and internal scoring will go up (but some banks will reject you for that!).
    • Ebe Scrooge
    • By Ebe Scrooge 5th Feb 18, 6:47 PM
    • 4,127 Posts
    • 3,569 Thanks
    Ebe Scrooge
    if the lender buys the score as-is, though this is less common in the UK than in some other countries.
    Originally posted by AllieKat
    With the greatest respect, you do seem to be missing the point here. Lenders DO NOT and CANNOT see the score that is made up by the reference agencies ( and they certainly don't "buy" it ).

    Certainly they will pay the CRAs to get a report of your financial history. Certainly they will feed that information into their own internal algorithms, and decide whether they wish to lend to you or not.

    By your own admission : "PIF [ I assume that means "Pay In Full" ? ] before any interest charges, etc and I think you'll generally find both your consumer scoring and internal scoring will go up (but some banks will reject you for that!). "

    As I said before, lenders make their own mind up. They have different acceptance criteria. Distilled down to the absolute basics ... some lenders prefer to make a small but regular profit by lending to people who are pretty much guaranteed to pay back, and who pay a little bit of interest now and then. Oh, and not forgetting that for credit cards, the card company receives a payment from the merchant for each transaction. Others make a large profit by lending to people who carry a balance month-to-month, they make a shed-load of interest but the borrower may well not pay back, so the lender then has to suffer all the associated court costs etc. That's their preferred business model, and that's the risk they take.

    The bottom line is - the score provided by the CRAs is totally meaningless. What IS important - if you want to access credit at a competitive rate - is to build up a solid history of responsible borrowing and repayment, and also to check that the information held by the CRAs is factually correct. No more, no less.
    I may not know much about art, but I know what I like.
    • TheBanker
    • By TheBanker 5th Feb 18, 7:54 PM
    • 618 Posts
    • 1,561 Thanks
    TheBanker
    With the greatest respect, you do seem to be missing the point here. Lenders DO NOT and CANNOT see the score that is made up by the reference agencies ( and they certainly don't "buy" it ).
    Originally posted by Ebe Scrooge
    Lenders can buy in a score. It's not common but it is possible.

    More likely to be very small companies like letting agents, rather than big banks.

    But the point being made is still valid - the score the CRA shows you is not absolute nonsense. It uses an algorithm which is similar to those used by banks. Not the same, but similar.
    Make 10 a day challenge: Jan-18: 330 / 400
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