How Can a Florida Consumer with a Good Credit Score be Denied Credit?

Florida consumers with good credit scores (720+) may assume that credit card and loan denials won’t happen. After all, society places a lot of value on credit scores, so it’s easy to see how consumers assume that a “good” one will get them as much credit as they want. However, many Florida applicants with good credit scores get unpleasant surprises when their loan or credit card applications are denied. The truth is that your credit score is just one factor in the credit approval process. Granted, it is typically a major factor. Yet, other elements can, at times, outweigh a good credit score and lead to a credit rejection letter.

Four Reasons Why a Florida Consumer with a Good Credit Score May be Denied Credit

When a lender or creditor rejects a credit application in Florida, the denied consumer receives an adverse action notice. This letter explains why a credit applicant was not approved. For Florida residents on the verge of credit application, here are a few reasons why you might get denied even if you have a good credit score.

Your income is either too low or from a non-traditional source.

Your income is not a factor in the calculation of your credit score. Yet, most lenders do care about the numbers on your paycheck. Mainly, they want assurance that can afford to take on additional debt. By adding up your existing bills and comparing this total to your monthly income, they calculate your debt to income (DTI) ratio. This is the percentage of your income already claimed by monthly obligations. If your DTI ratio is too high (50%+), you may be denied credit in spite of your good credit score.

The creditor uses a different credit score for approval decisions.

Every Florida consumer may have hundreds of different credit scores, based on hundreds of different models. Therefore, a potential lender may pull a credit score for you that you have never seen. For example, banks typically use their own scoring models partially based on banking activity. So, if you have over-drafted your account on numerous occasions, this appears as a risk factor. Your bank may not approve your loan application regardless of your high FICO score or VantageScore.

The creditor has specific requirements that you don’t meet.

Some banks require at least two years of credit history and two currently active accounts for loan approval. So, if you have a good credit score, but a limited credit history, you may get denied. Other requirements might include at least one year of consistent employment or proof of residence stability. Therefore, if you recently relocated to Florida and/or changed jobs, your loan approval chances may temporarily drop.

You are a credit card “gamer.”

Some Florida consumers constantly apply for new credit cards just to take advantage of generous sign-on bonuses. If you have a good credit score, you can get away with this for a while. However, the credit card companies eventually catch on. Creditors call these kinds of applicants “gamers” because they try to “game the system.” Creditors look for long-term, profitable customers, so if they suspect that you are a gamer, you may not get approval for a new card.

How Florida Consumers Can Improve their Credit Approval Chances by Cleaning Up their Credit Reports

Florida consumers who receive an adverse action notice after a credit denial also get a copy of their credit score. If it turns out that your credit score is much lower than expected, take advantage of the free credit report offered in the letter. All adverse action notices should come with detailed instructions on how to claim this free credit report.

An even better move is to visit www.annualcreditreport.com and request copies of your credit report from TransUnion, Experian, and Equifax. The Fair and Accurate Credit Transactions Act (FACTA) entitles all consumers to do this every 12 months. Once you have your credit reports, go over each one carefully. Fraudulent activity caused by identity theft is often to blame for inexplicably low credit scores. So, look for bogus accounts and unauthorized transactions. Also, credit report errors and mistakes made by creditors and the credit reporting bureaus can cause credit scores to drop, so check for those as well.

If you find anything on your credit reports that shouldn’t be there, call Credit Repair Lawyers of America in Florida. We are a law firm that specializes in credit restoration, and when you contact us, an experienced credit attorney will clean up your credit reports for free.

The Free and Legal Way to Get Better Credit

Don’t let fraudulent accounts or errors on your credit reports bring your credit score down. At Credit Repair Lawyers of America, we’ve been cleaning up credit reports for consumers since 2008 for free. How do we do it? All of our fees come from the defendants in settled cases. This is why our clients pay nothing for the work we do.

Let’s start the conversation about what we can do for your credit. Set up your free consultation today by calling Attorney Gary Nitzkin at (408) 290-3994 or sending him a message through our contact page.

For more information about Free Credit Repair, please visit https://creditrepairlawyersam.com/florida/credit-repair/. Or, to learn more about Free Credit Repair After Identity Theft, check out https://creditrepairlawyersam.com/florida/fix-identity-theft/.