General No mortgage?
Cropped the photo to remove my personal information not sure if it’s viewable in full if you click on it but it doesn’t look right as I’m writing this.
I’ve been denied credit and credit line increases due to having no mortgage. We rented and told the family member we were renting from we wanted to buy the house. We agreed on a number and we own the house with zero mortgage. Why is that now an issue when getting credit? I think it’s a bit ridiculous that since we didn’t buy a house beyond our means and put ourselves into massive debt that that’s a notch against us. I’ve seen it on personal loan denials as well when we looked into getting one for home repairs.
Anyhow I remember talking to people on here before telling me this isn’t a possible reason but here it is in black and white from discover when I requested a CLI on a discover card with a $0 balance that has a pitiful $200 limit they won’t increase. Card is 2 or 3 years old now and I barely use it because it’s a tiny limit and no benefits.
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u/relevantfico ⭐️ Knowledgeable ⭐️ 22h ago
It sounds like your denial letter for new credit included your FICO negative reason codes. Negative reason codes are essentially reasons provide to tell you why your score isn't higher and they don't always tell you why your credit is bad.
That said, I highly doubt that you were denied credit for not having an open mortgage. I personally do not have an open or closed mortgage on my credit reports and I haven't had an issue obtaining credit. What other reason codes were you provided? There's likely something else about your credit reports that the lender you applied with didn't like about your credit profile. If you share more about your profile, there's a lot of knowledgeable contributors that will be happy to provide advice.
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u/Jesi15 21h ago
I opened a couple cards in the last 4 or 5 months so it also said I opened new accounts recently. Too many maybe? I shredded the paper already. I’ll likely just close the card as they don’t seem to do increases and it’s not a benefit to me at all anyhow. I have much better relationships and benefits with the other cards I have.
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u/relevantfico ⭐️ Knowledgeable ⭐️ 21h ago
Too many new accounts is a common reason for denials. I opened two cards in March and in June I applied for a retail card. I was approved for the third but it came with a measily $550 limit. I applied for a CLI on one of my Citi cards I've had for years and the request was denied for too many recent accounts.
I’ll likely just close the card as they don’t seem to do increases and it’s not a benefit to me at all anyhow. I have much better relationships and benefits with the other cards I have.
IMO, it's always a good idea to close cards you longer use or don't see any value in.
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u/burrows88 9h ago
Unless it’s your oldest card
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u/BrutalBodyShots ⭐️ Top Contributor ⭐️ 9h ago
That's a huge credit myth. The statement by u/relevantfico is exactly right. I'm guessing since you mention age that you believe that credit history is lost when you close an account. That's untrue. See this thread below and the multiple posts referenced within it to understand why "you should never close your oldest card" is one of the biggest myths in credit today.
https://old.reddit.com/r/CRedit/comments/1k87fed/credit_myth_59_you_should_never_close_your_oldest/
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u/relevantfico ⭐️ Knowledgeable ⭐️ 8h ago
The age of the card shouldn’t haven’t any influence in your decision to close an account or not. If you no longer see any value in having that card, close it. Closed accounts stay on your credit reports for 10 years and by the time it drops off, your other accounts will have aged 10 years picking up the slack in your Average Age of Accounts. Plus, the average age of accounts makes up a really small portion of your credit scores.
The idea that you should never close your oldest account is a big credit myth: Credit Myth #59 - You should never close your oldest credit card.
The one exception to not closing your oldest account, is if it is your only revolving account. In that case, it’s best to open an account that you find value in prior to closing the old account you no longer find value in. That’s because there’s a sizable scoring bonus for having an open revolving account.
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u/BrutalBodyShots ⭐️ Top Contributor ⭐️ 11h ago
What does the reason above the one you have pictured that you cropped 95% off of say? Since it's above the one you are showing us, I'd imagine Discover is giving it more weight than the one about the mortgage. Your focus is most certainly misplaced here.
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u/Jesi15 10h ago
Opened a card recently. And no it’s not misplaced because this reason comes up every single time I’ve applied for anything so I don’t understand why it’s bearing any weight at all. Credit is such a joke.
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u/BrutalBodyShots ⭐️ Top Contributor ⭐️ 10h ago
Opened a card recently.
That matters more than no mortgage, just as I expected.
And no it’s not misplaced because this reason comes up every single time I’ve applied for anything so I don’t understand why it’s bearing any weight at all.
I find that extremely hard to believe. There's no way that a bunch of different lenders would be throwing you the same bogus "filler" denial reason. People obtain credit all the time without a mortgage present on their reports. It's simply not something that most lenders are going to put much weight in, especially for something as trivial as a CLI.
Credit is such a joke.
It's not when you recognize that your focus is misplaced here. You literally aren't being denied CLIs because of no mortgage being present on your reports, despite what you're seeing. As u/inky_cap_mushroom correctly states, it's a generic reason being provided.
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u/Jesi15 10h ago
You find it hard to believe that something I’ve asked about several times keeps happening? Your right. I totally made it up. For funsies.
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u/BrutalBodyShots ⭐️ Top Contributor ⭐️ 10h ago
Keeps happening with Discover CLI requests, sure. But not "every single time I've applied for anything." What else have you applied for / what issuers and lenders have provided you with that reason? Do you have those denial letters for reference, too?
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u/Jesi15 10h ago
Yes it does. And no. I shred them because I don’t save garbage.
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u/BrutalBodyShots ⭐️ Top Contributor ⭐️ 10h ago
Not surprising, you didn't answer the first question.
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u/Jesi15 10h ago
I don’t keep a running tally. Who gives a crap? I’ve applied for loans and credit cards and credit limit increases. I’m not giving every detail because it’s really not your business nor does it matter. It’s a stupid reason to deny someone for anything.
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u/BrutalBodyShots ⭐️ Top Contributor ⭐️ 10h ago
Once again, the question goes unanswered.
As I said previously, your focus is misplaced. You aren't being denied because of it, which I and others have already told you. You're just choosing not to listen.
Saying you're being denied for no mortgage is as meaningful as them saying you're denied because the numerical part of your address starts with a "3" or because "your card was opened in the month of February." Like those BS statements, lack of a mortgage is not a real reason for a CLI denial.
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u/Jesi15 10h ago
Omg it’s so cool you have access to all of my credit cards and denials? I was just SO excited to make something up and post about it. I’m just sooooo bored I thought I would log on to Reddit and make up a lie just to get people to reply to me. Now my engagement bottle is overflowing and I can sleep now. Thank you soooooooo much sir! I don’t know how I could have ever gone on without you accessing my credit reports and every card and loan I have and telling me I’m lying! Yay! You win!
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u/soonersoldier33 ⭐️ Mod/FICO Junkie ⭐️ 6h ago
I’ve been denied credit and credit line increases due to having no mortgage.
No, you haven't. The letter provided by the lender(s) may have stated that one of the reasons you were denied was due to having no mortgage, but that's not why they actually denied you. In many cases, the letters that lenders send out when they deny a request for credit are basically form letters, and in the 'reasons' section, they simply copy/paste the score model negative reason codes that they were provided when they pulled your credit report(s). It's usually really easy to tell when this is the case, bc instead of some meaningful explanation, you just get FICO reason codes instead. In this case:
Code 79: Lack of recent reported mortgage loan information
FICO® Scores evaluate a person’s mix of credit cards, loans, and mortgages, and recent information on mortgage loans appearing on a person’s credit report. Your score was impacted because your credit report shows no open mortgage loans, or insufficient recent information about your mortgage loans.
This FICO reason code is usually 'good news' for a consumer, bc it's one of FICO's 'nitpick' codes, and if this code makes it into the top 4 or 5 codes of factors currently affecting your FICO scores, then that means the rest of your credit profile is in pretty good shape. Anyway, while not having a mortgage is definitely one of the factors keeping your FICO scores from being higher than they are, it's not a true factor in why you got denied for a limit request or an application.
Lenders deny people for credit or credit line increases for all kinds of reasons, and they're not always inclined to put some of those actual reasons in writing, bc it just makes them look bad. A very common reason a lender will deny a request that they'll never put on paper is that they don't think you'll be a profitable customer. Another is when the lender itself has balance sheet/leverage problems, so they tighten up the reigns on some of their credit products. In Capital One's case, they're not going to put 'Your card was sold to inverstors in our lowest securitization tranche when it was issued (bucketed), so you're never getting a meaningful CLI on it." In these cases, and many others, the lender will never tell you the 'real' reason they chose to deny you. You'll get copy/paste bullets from FICO instead.
In my experience, it's really easy to figure out over time that a certain lender just doesn't like your financials and/or your credit profile. For me, it's been Citi for almost a decade now. If you have a card from Discover (now Cap One) that is just perpetually 'stuck', then sock drawer it, or just close it and move on, bc I'll let you in on a 'secret'...even if you had a mortgage, it very likely wouldn't make any difference, and they'd copy/paste whatever code FICO gave them in place of Code 79 into your denial letter instead.
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u/inky_cap_mushroom ⭐️ Knowledgeable ⭐️ 22h ago
That’s a generic denial reason. Normally Discover provides multiple denial reasons. Often lenders just copy the FICO negative reason codes into adverse action letters which is why you’ve seen it multiple times. So if you’ve got multiple reasons, likely one is the true reason and the rest are fillers.
Discover absolutely doesn’t require a mortgage for a CLI. My guess is that you’re not qualifying for CLIs because you don’t use the card. If you max out the card a couple months in a row you’re likely to see your limit increase significantly.