Have you been disappointed by a denial of credit? Have you felt confused as to why? Here’s how to handle the situation.
If a creditor rejects your application, they must provide you with a Notice or Letter of Adverse Action explaining why. Instead of ripping it up in disgust, take the time to read the reason stated, then you will know how to proceed.
Possible Reasons for a Credit Denial
- You have too much credit.
Yes, there is such a thing as having too much credit, even if all the accounts are paid on time. If you have a half dozen credit cards and they are all maxed out, that would be an example. Maxed out credit could mean you are living beyond your means. It could mean you are living off your credit cards, which is a slippery slope into financial trouble.
The cure is to stop using credit…
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