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Discover ‘Freeze it’ feature lets you turn your card on and off

Posted by CreditCardGuru on

You can’t find your credit card. It could be in the hands of a thief, or it could be between the sofa cushions. In most cases, you have two immediate options: Worry about what the thief is buying while you tear apart the inside of your car, or call your bank and ask it to shut down your card and replace it.

If you then find the card in the sofa after the new one’s already in the mail, you still have to update any autopay bills linked to your card, as the new one will likely have a new number.

Discover, however, is now providing another option – which it’s calling “Freeze it.” The issuer says it’s the first to offer this capability.

This video shows how it works:

In a nutshell, freezing your account allows you to turn it on and off. Here’s a breakdown of some of the details:

  • It’s quick. You can freeze your account online, via an app or on the phone. The app is a particularly good option if you’re on the go — you can just freeze the card as a precaution and then search for it as soon as you have time. You also get to avoid the ritual of looking up your issuer’s phone number, pressing various numbers and waiting on hold.
  • It’s thorough. While your account is frozen, the physical card can no longer be used in stores, nor can the account number be used online or over the phone. Balance transfers are shut down, too. Note that all cards on your account will be frozen, so let your authorized users know.
  • It doesn’t affect account activity you actually want. Recurring bills linked to your account won’t be disrupted while your account is frozen, solving the autopay dilemma that usually comes up when you lose your card. Any scheduled payments of your balance will also go through as well, and you can still redeem rewards.
  • It’s temporary. If you find your card, you can unfreeze your account – Discover will remind you in a week if you forget to unfreeze. If you don’t find your card, you can report it lost or stolen online, via the app or on the phone and ask for a replacement. At least you’ve had time to retrace your steps for a few days and determine the card is probably gone for good before you pull the plug.
  • You can freeze/unfreeze as often as you wish. This has potential as a money-management method as well, if you have problems controlling you spending. The feature may also be welcome to anyone who wants to sock-drawer their Discover card — if the card is no longer useful, but you want to keep it open for credit-building purposes, freezing the account provides an extra layer of security while it’s tucked in your sock drawer or another safe place.

Even if you find yourself wishing that all the cards in your wallet had this capability, know that all credit cards do provide protection against theft and fraud. The Fair Credit Billing Act guarantees that you’re responsible for no more than $50 in fraudulent charges before you report your card lost or stolen. However, card networks and issuers generally extended zero-liability protection to cardholders, meaning you wouldn’t even be responsible for $50.

Editorial Disclosure: The editorial content on this page is not provided by any bank, credit card issuer, airline or hotel chain, and has not been reviewed, approved or otherwise endorsed by any of these entities. Opinions expressed here are author's alone, not those of the bank, credit card issuer, airline or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

Cards that offer statement credits for annoying travel fees

Posted by CreditCardGuru on

It’s often the extras that make travel expensive – baggage fees, Wi-Fi costs and comforts like hotel spa services and lounge access. Want to keep your shoes on through security, or skip the long lines at customs? That’ll cost you extra too. Delta luggage carousel at airport

Some cards offer to ease this burden somewhat by offering you statement credits for “travel incidentals.” If you use your card to make qualified travel charges (such as baggage check fees, a meal on a plane and other I-can’t-believe-they-charge-for-that purchases), or to apply for TSA Precheck or Global Entry, the issuer will reimburse you via a statement credit. The Premier Rewards Gold card from American Express (a CreditCardForum advertising partner) is the latest to announce it’s adding a statement credit benefit for airline fees (starting June 2015).

If you travel frequently, this type of perk can save you money (use the chart below to find out how much) – but our closer look turned up some fine print you’ll want to be aware of:

Credits don’t roll over

If your card offers $200 worth of statement credits per calendar year, and you use $150, don’t expect that remaining $50 to be available to you the following year. Read your card’s terms to find out exactly when that year’s credit expires to avoid leaving money on the table.

Rewards experts have long touted a favorite technique for quickly using up credits before the end of the year: Buying airline gift cards. It’s not a sure thing, though, and some cards’ terms and conditions explicitly state that no statement credits will be given toward airline gift cards. Here’s a snippet of American Express’s terms regarding the Platinum card’s $200 airline fee credit, for example:

Statement credit for airline gift cards

But run a Google search, and you’ll find bloggers and forum members who have received statement credits for gift card purchases. If you’d use the gift cards anyway, it’s worth a try – but don’t count on reimbursement.

Statement credits aren’t always automatic

The majority of the cards we looked at automatically reimburse you within the next few billing statement if you make a qualified purchase – you get your money back with no extra effort.

A few cards, however require you to call the bank, verify the purchase and request a statement credit. You’ll find instructions within your card’s fine print. Here are the terms on the Ritz-Carlton Rewards card’s $300 travel credit, for example:

Ritz carlton statement credit

Don’t assume you know what “incidental” means

Seat upgrades often aren’t eligible for statement credits. Same goes for in-flight Wi-Fi (as this is often charged by a third party rather than the airline itself). Fees on reward tickets are generally out as well.

However, you might be pleasantly surprised by what your card’s statement credit covers. A few cards even allow you use it toward the cost of airfare.

Whether you can use your statement credit benefit toward a charge is completely up to your issuer. If you feel you weren’t credited properly, call your bank. Better yet, read your card’s terms before you splurge on something and assume you’ll be reimbursed.

Credit cards that offer statement credits for travel incidentals
Statement creditCan be used forRestrictions
Platinum and Business Platinum card from American Express$200 airline fee credit per yearAirline incidental fees (baggage fees, in-flight food and beverages and more)-Good only for selected airline (which you can change every January).

-Airline must be on AmEx's approved list of carriers

-Cannot be used for tickets, upgrades, buying miles, fees for transferring miles or gift cards.
Credit for Global Entry and TSA PrecheckApplication fees for either of these programs-Good only for one or the other (Precheck OR Global entry)

-Can be used only once every 5 years
American Express Premier Rewards Gold$75 hotel credit per stay of 2 consecutive nights or moreHotel incidental fees (qualifying dining purchases, spa and resort activities)-Must be used at properties in American Express's Hotel Collection

-Cannot be used for taxes, gratuities

-Cardmember must travel on itinerary booked
Starting June 1, 2015: $100 airline fee credit per yearAirline incidental fees (baggage fees, in-flight food and beverages and more)-Good only for selected airline (which you can change every January).

-Airline must be on AmEx's approved list of carriers

-Cannot be used for tickets, upgrades, buying miles, fees for transferring miles or gift cards.
Discover it Miles$30 in-flight Wi-Fi credit each yearWi-Fi access on aircraftCannot use for airport Wi-Fi purchases.
FlexPerks Travel Rewards card$25 airline allowance for each reward ticketAirline incidentals (baggage fees, in-flight food purchases and more)-Only good on reward bookings

-Must call cardmember services to request the statement credit within 90 days of purchase
Ritz-Carlton Rewards card$300 travel credit per calendar yearAirline lounge day pass, yearly lounge membership, airline seat upgrades, baggage fees, in-flight entertainment, in-flight meals, Global Entry application feeMain account holder must call J.P. Morgan Priority Services to request credit within 4 cycles of purchase date
$100 hotel credit for stay of 2 consecutive nights or moreDining, spa and hotel recreational activities-Must stay at participating property.

-Cannot be used for cost of room.
Citi Prestige$250 air travel credit per calendar yearTickets, baggage fees, lounge access, some in-flight purchases
AAdvantage Aviator Silver$100 Global Entry statement creditGlobal Entry application feeApplication must be approved by Global Entry program.
Expedia+ Voyager$100 airline incidental credit per calendar yearAirline incidental fees (in-flight-dining, baggage fees, etc.), Wi-Fi hotspots, Global Entry application fee-Good only for qualified airlines (see card terms for list) and Wi-Fi hotspot providers (currently Boingo and Gogo).

-Cannot be used for airfare

Editorial Disclosure: The editorial content on this page is not provided by any bank, credit card issuer, airline or hotel chain, and has not been reviewed, approved or otherwise endorsed by any of these entities. Opinions expressed here are author's alone, not those of the bank, credit card issuer, airline or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

Is it ever a good idea to use a credit repair company?

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Whether it’s overrun with errors or scarred by past transgressions, your credit report needs a good cleaning. Plenty of companies promise to do that at a cost, but the credit repair industry doesn’t have the best reputation. Plus, you can do a lot of the legwork on your own for free.

Here’s how to spot scammers – and how to know when hiring reputable help may be worthwhile.

Signs of a scam

The credit repair umbrella covers a variety of services, from liaising with the bureaus on your behalf to correct errors, to negotiating debt, to performing miracle work that hardly seems possible (or legal). fresh start

“The hallmark of any scam is that the person who’s pulling off the con is looking for someone who is desperate to change their situation and is in a hurry to do it,” says Bruce McClary, vice president of public relations and external affairs at the National Foundation for Credit Counseling.

No matter how desperate you are, if you encounter any of the following, the company is not one you want to work with.

They want payment up front
Did the credit repair service ask for money before performing any services? “Run away,” says Doug Minor, credit damage consultant and expert witness.

For one thing, it’s a violation of the Credit Repair Organizations Act, signed into law in 1996 to prevent credit repair businesses from misleading customers. For another, you’ll be worse off when the company fails to follow through on its promises.

“That’s where you get the horror stories,” Minor says. “You’ll hear, ‘I paid them $2,000 and nothing happened.’ I’ve heard that story too many times. You give someone money up front, first off they’re breaking the law, and second they’re not worth the money.”

They promise to raise your credit score
Guarantees of any kind are suspect, Minor says.

“How can you guarantee the outcome of something you don’t know ahead of time? They don’t know how the creditor is going to respond, how the bureau is going to respond,” Minor says.

Dodgy credit repair operations may appear to fulfill this promise, thanks to the fact that accounts in dispute are bypassed by FICO’s scoring model while the credit bureaus investigate the dispute (which generally takes 30 days). This will cause your score to temporarily spike. It will crash later if the derogatory account is confirmed legitimate, but if pull your score during the dispute period, it will seem like the credit repair company worked some magic.

The kicker, Minor says, is that the bureaus will label the account as being in dispute – and any lender you apply to will see that label and know your score isn’t accurate. If your goal is to get a mortgage, know that Fannie Mae and the Federal Housing Administration have guidelines that prevent approvals if you have accounts in dispute.

“That’s where the consumer has to beware,” Minor says. “It might be that the credit repair company doesn’t have an understanding of those underwriting guidelines, and all they want to do is make their money. They don’t care if your desired outcome is to buy a house, and their actions are going to prohibit you from doing that.”

They promise to scrub accurate information
The reliability of the whole credit-reporting system rests on valid information being reported for the length of time dictated in the Fair Credit Reporting Act (FCRA). So, if a credit repair service says it can remove accurate but undesirable information (late payments, collection accounts, etc.) earlier, “there’s something fishy about the offer,” McClary says.

What they’re actually doing is gaming the system. According to the FCRA, information that isn’t verified with the creditor within 30 days must be removed from the report. So disreputable credit repair companies will dispute accurate information in hopes that the creditor (the bank, collector or whoever is furnishing the data) won’t respond to the bureau in time. If it doesn’t, the account will fall off temporarily. You’ll pull your report, see the account gone and think that the credit repairer has done a good job.

However, creditors report to the bureaus regularly (generally monthly). So those vanished accounts will return.

“That’s what gets a lot of people,” McClary says. “The real unpleasant surprise comes maybe a few months later, when they find those accurate accounts are showing up again, the ones they thought had been erased permanently.”

They ask you to sign away your rights
CROA requires that credit repair organizations draw up a contract that, among other things, guarantees a cancellation period. But, sometimes, in lieu of or in addition to the contract, a scammy company will ask you to sign a form waiving your CROA rights.

“That’s a huge red flag, McClary says. “They’ll come up with all kinds of phony-baloney reasons they’re asking you to do that.”

For example, they might say that, by signing the form, you’re giving them more flexibility in communicating with the credit bureaus on your behalf. This kind of paperwork won’t hold up in court, McClary points out. However, it’s better to run before it even comes to handing over your money and launching a legal battle.

They promise a clean credit slate: If a credit repair company offers you a blank slate, something illegal is afoot.

For example, the company may encourage you to start applying for new lines of credit with a different Social Security number (or they may call it a “credit privacy number”). The credit bureaus will then open a new file for this number. The process is called file segregation, and it’s illegal. But seedy companies are careful about how they describe this to customers.

“It is usually presented to the customer as a promise to completely clean their credit report of everything so they get a fresh start,” McClary says.

But it’s a “false fresh start,” McClary says, and it creates a mess later on. If you’re aware of what the company is doing, you could land in legal trouble. Plus, your old file is still floating around, attached to your real Social Security number – and your new clean file with your newest accounts is technically illegal. Fixing your file the old-fashioned way (paying off debts, gradually adding new accounts, and paying on time) is better in the long run than two useless credit files.

Are there any good apples – and should you use them?

There are times you might want to turn to a legitimate credit repair company. For example, maybe you don’t have time to dispute errors on your own.

“Some people just don’t want to deal with these things,” Minor says. “Or maybe their job is too demanding. If you can pay a couple hundred dollars to correct something and your time is worth more than that, it might be worth it to hire someone.”

Other issues that might warrant professional help include complicated errors. An account may be coded as a foreclosure, instead of as a deed in lieu of foreclosure, for example. It won’t make much difference to your score, but the code can make a huge difference in when you can get approved for a new mortgage. Having someone who knows the ins and outs of the industry and can communicate the coding error to the bureaus can probably fix the issue faster than the average consumer, Minor says.

Problem is, the credit repair industry is “so deeply infected with scams,” McClary says, that finding a reputable service can be difficult for consumers.

Minor recommends asking companies or professionals the following:

  • Have you passed the Fair Credit Reporting Act certificate program from the Consumer Data Industry Association?
  • Have you earned the FICO Pro certification?

    “At least that’s going to tell you they’ve spent some time trying to understand FICO scores and how things impact them,” Minor says.

  • Are you a member of the National Association of Credit Service Organizations?
  • Is your company bonded, and does it have a business license?

“Just by asking those questions about the certifications and organizations and about the business, it’s probably going to eliminate a great deal of the undesirables,” Minor says.

When to do it yourself

Consider saving money and skipping professional help in these circumstances:

Help yourself
  1. Fixing most errors: While zapping credit report errors is a chore, it’s relatively painless for most. The bureaus have made strides in the past decade to improve the process, McClary says, noting that just this year, Equifax, Experian and TransUnion announced that they would be giving more individual attention to disputes.

    “My identity was stolen years back, and it was a very frustrating time-consuming process,” McClary says. “A lot of people are going to be relieved that the process is now more streamlined. And it’s something the consumer can do themselves instead of shelling out money to someone.”

  2. Removing one-time late payments: For whatever reason, you paid late. It’s out of character for you, and you don’t want a late payment notation camping out on your report for seven years.

    “Maybe you were just on vacation or the proverbial dog at your payment,” Minor says. “It happens to the best of us, and it’s happened to me.”

    Rather than running to a professional with your checkbook open, call your creditor, Minor suggests. If your history is otherwise clean, they might agree not to report the late payment (if they haven’t already). If they’ve already reported it, they might agree to stop reporting it to the bureaus as a courtesy.

    “The right thing to do is to make the call and see what you can get,” Minor says. “Hopefully they’ll be empathetic and accommodate you.”

  3. Fixing a long history of bad credit: If you’re looking to get rid of charged off accounts and years of late payments, a credit repair company is not the answer. There’s no way but the hard way in this situation. McClary recommends becoming versed in what affects your credit score (some credit counseling agencies offer programs and online resources, as does the NFCC).

    “The best way to repair a credit file is through a lot of hard work and a lot of time,” McClary says. “You’re going through a restoration period where you’re opening new lines of credit, making on-time payments, keeping balances low while you’re trying to resolve the balances on those old, past-due accounts. Over time, you will see an improvement.”

Editorial Disclosure: The editorial content on this page is not provided by any bank, credit card issuer, airline or hotel chain, and has not been reviewed, approved or otherwise endorsed by any of these entities. Opinions expressed here are author's alone, not those of the bank, credit card issuer, airline or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

When will my credit card rewards expire?

Posted by CreditCardGuru on

The fun part of having a rewards card is watching your rewards balance grow with every purchase. But if you squirrel away points and miles for too long, they could all disappear, depending on your program’s expiration policy. rewards trap

The good news is that many programs keep your points alive as long as your account is open – and others give you easy ways to keep your account active so that your points are practically non-perishable.

If you plan on hoard rewards, here’s what you need to know. To compare the expiration policies of some of the most popular rewards card programs, use the chart below.

Common point and mile expiration policies

There’s a variety of reward program types (cash back, flexible rewards, travel, airline and hotel) – so expect expiration policies to vary as well. Some common expiration policies include:

  • Points never expire – as long as your card is open, that is. This is the model commonly used by cash-back cards and cards with proprietary rewards programs (such as Chase Ultimate Rewards, Citi ThankYou, the Membership Rewards Program from American Express, a CreditCardForum advertising partner). However, some of these programs allow you to transfer points into the programs of airline and hotel partners. If you do so, those transferred points will be subject to that program’s expiration policies.

    Read your card’s terms and conditions, however, and you’ll find that you’ll need to keep your account “in good standing” to preserve your points. Depending on the issuer, late payments and delinquencies can freeze or even wipe out your rewards.

  • Points don’t expire as long as your rewards account is active. “Active” generally means you’ve earned points or redeemed points. Yet there are some exclusions – see Marriott’s rules, for example:Marriott Rewards expiration policy

    This kind of “active account” policy is common among airline and hotel programs. So, if you have a co-branded airline or hotel card, expect its expiration rules to conform to the airline’s.

    Luckily, if you have the card, you’ll be earning points with every card purchase, so a single charge will re-set the expiration clock. The United MileagePlus cards from Chase give you even more protection – as long as your card stays open, you can side-step United’s expiration rules altogether.

  • Rewards automatically expire after a certain amount of time. Luckily, this kind of program is rare. Of the cards we surveyed, only the U.S. Bank FlexPerks cards have it.

Expiration of other perks

Miles and points aren’t the only thing you can get out of rewards cards. Some give you additional perks from statement credits for travel incidentals, companion airline tickets or discounts and free hotel nights. These often have their own expiration policies (in some cases, you have just six months to redeem these perks). It’s disappointing to miss out on a free night or companion ticket, so read your card’s fine print carefully and make sure you know your benefits’ use-by date.

Expiration policies of popular credit card rewards programs
CardRewards programPoint expirationOther perks' expiration
Flexible rewards programs
American Express EveryDay/EveryDay PreferredMembership RewardsPoints do not expire, as long as you have an active Membership Rewards card.

Points transferred to airline and hotel programs are subject to those programs' rules.
American Express Premier Rewards Gold$100 airline fee credit (effective June 1): Expires each year on Dec. 31.
American Express Platinum$200 airline fee credit: Expires each year on Dec. 31.
Chase FreedomUltimate RewardsPoints do not expire as long as account remains open
Chase Sapphire PreferredUltimate RewardsPoints do not expire as long as account remains open.

Points transferred to airlines and hotels are subject to those programs' rules.
Citi ThankYou Preferred and Premier cardThankYou programPoints do not expire, as long as you have an active card tied to your ThankYou account.
Citi PrestigeThankYou programPoints do not expire, as long as you have an active card tied to your ThankYou account.

Points transferred to airline and hotel programs are subject to those programs' rules.
$250 air travel credit: Unused credit expires each year if not posted by December billing cycle.
Cash Back
American Express Blue Cash/Blue Cash PreferredN/ARewards do not expire as long as card remains open.
BankAmericard Cash Rewards
Capital One Quicksilver Quicksilver
Discover it
U.S. Bank Cash+
Citi Double CashRewards expire if you haven't earned any cash back from payments or purchases in 12 months.
General travel
BankAmericard Travel RewardsN/ARewards do not expire as long as card remains open.
Barclaycard Arrival Plus
Capital One /VentureOne
Discover it Miles
U.S. Bank FlexPerks/FlexPerks Select cardsFive years from the end of the quarter in which you first earned them.
Alaska Airlines Visa SignatureMileage PlanMiles expire after no rewards account activity in 24 months.Companion ticket discount: Expires 12 months from date of issue.
American Airlines Citi AAdvantage cardsAAdvantageMiles expire after no rewards account activity in 18 months.Companion ticket benefit (Platinum Select card): Expires 1 year from date of issue.
Delta SkyMiles cardsSkyMilesMiles do not expireCompanion ticket benefit (Platinum and Reserve card): Expires on date listed on the companion certificate (generally a little over a year after it's issued).
Frontier Airlines World MasterCardEarlyReturnsMiles expire after 6 months of no rewards activity.
Hawaiian Airlines World Elite MasterCardHawaiianMilesMiles expire after no rewards account activity in 18 months.One-time companion ticket discount: Expires 13 months from account open date.
JetBlue card from American ExpressTrueBluePoints don't expire.
Southwest Rapid Rewards cardsRapid RewardsPoints expire after no rewards account activity in 24 months.
United MileagePlus cardsMileagePlusMiles don't expire as long as you have an open card in good standing. If you cancel your card, miles are subject to United's MileagePlus rules and will expire after 18 months of no rewards activity.United Club Passes (Explorer card): Expire on date printed on the certificate.
Hilton HHonors credit cardsHHonorsPoints expire after 12 months of no rewards activity.Free weekend night for new cardmembers who meet spending requirement (Reserve card): Expires 12 months after date issued.
Hyatt Credit CardGold PassportPoints expire after 12 months of no rewards activity.Free nights for new cardmembers who meet spending requirement: Expires 1 year after date issued.

Free anniversary night: Expires 12 months after date issued.
IHG Rewards Club Select credit cardRewards ClubPoints never expire.

Starting May 2016, points will expire after 12 months of no reward activity.
Annual free night: Expires 12 months after date of issue
Marriott Rewards Premier Credit CardMarriott RewardsStarting Feb. 2016, points will expire after 2 years of no rewards activity.Free night for new cardmembers: Expires 6 months after date of issue.

Free anniversary night: Expires 6 months after date issued.
Starwood Preferred Guest cardPreferred GuestPoints expire after 1 year of no rewards activity.

Editorial Disclosure: The editorial content on this page is not provided by any bank, credit card issuer, airline or hotel chain, and has not been reviewed, approved or otherwise endorsed by any of these entities. Opinions expressed here are author's alone, not those of the bank, credit card issuer, airline or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

Why instant approval isn’t always instant

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approved or rejected stamp

The card’s website offers you “a decision in seconds” or even an “instant” decision. You eagerly fill out the online form, hit submit … and get a message saying that the issuer needs more time to make a decision. It might even ask you to send in more information to verify your address and Social Security number.

So why did your application get caught in the net instead of getting speedily approved or rejected? We asked Kevin Haney, a former sales director at a big-three credit bureau who shares his industry knowledge at, for some insight.

The first thing to know is that banks and consumers want the same thing.

“Consumers want to want an instant answer,” Haney says. “Nobody likes to wait. And being able to get an answer to people quickly is something the banks would like to do.”

When you hit the “submit” button, a credit report is immediately pulled and the issuer’s system parses it, as well as your credit score. It takes mere moments, but the process is sophisticated; over decades of analyzing cardholders’ behavior (good and bad) and credit reports (good and bad), banks have a sense for what kind of consumers they want, Haney says.

After this blink-of-an-eye analysis, banks will put you in one of three categories: “Instant approval,” “instant denial” and “manual review.” The first two categories are ideal for the bank because they’re less expensive.

“But there are always going to be a group of people in the middle,” Haney says. “They require a person to look through their application.”

So why did you wind up in the manual review category? There are several possible reasons, which usually boil down to something in your report looking risky (you may rack up a bunch of debt and not repay it) or fishy (you may be fraudster applying with a stolen identity):

1. Your score

Each bank has its own criteria for approvals, and one is the credit score. Scores over a certain mark (determined by the bank) will mean instant approval, and scores under a certain mark mean instant denial. But there’s often a gray area between those two points, Haney says. And applicants whose scores fall within it leave the issuer unsure.

“They don’t want to turn away possible customers,” Haney says. “But the value of a good, solid customer is much smaller than the potential losses from a bad customer.”

So those applications get sent into a manual-review queue so that a human can take a closer look at other factors in the credit report.

2. Other elements of your report

Even if you have a good credit score, other information in your report may get flagged by the computer and passed on to an analyst for manual review.

Some of those things may include having having more open accounts than the bank is comfortable with, or just having a certain combination of factors that has a reputation for risk.

“The bank is saying, ‘We like the score, it’s good for us, but then there are additional things that we’ve learned from our history and experience that we might want to take a closer look at,’” Haney says.

Sometimes, you may have to make some adjustments to get approved. For example, if you already have several open accounts with a particular bank, the bank may not be comfortable extending you more credit. However, closing an existing account or transferring an existing credit limit over to the new card may be options.

3. Something doesn’t add up

Not only did you get a message that the bank needs more time, but you got a request to send in documentation verifying your address and Social Security number. That probably means the bank suspects fraud – no offense.

“There are common things banks see when someone is trying to open up an account under somebody else’s identity,” Haney says. “There’s just something about the combination of factors on the credit report that smells a little fishy. So first, they’ll kick [the application] into a queue and, second, they’ll ask for some additional information so they can verify who completed the online application.”
Faxing in proof of where you live and who you are can be time consuming – but it’s better to have the bank question you before approval than allow thieves to open cards in your name, Haney points out.

So why does the bank think you may be a fraudster? Sometimes, it involves the address.

“The most common thing that identity thieves do is they’re going to change the address on the account,” Haney says, so that the physical card is delivered to them and not to you.

Perhaps you just moved, and that’s why the address on your application doesn’t match the one on your other accounts – but the bank doesn’t know that. PO boxes may also prompt scrutiny, as may military addresses (frequent transfers mean frequent turnover of access to mailboxes), Haney says.

But there are more complicated factors at play. Credit issuers don’t report information perfectly, and the credit bureaus are not perfect at assigning information the correct person. As a result, the report that gets pulled for an applicant may have information that conflicts with other information, data from two different people entirely or transpositions of Social Security numbers and street addresses. Name changes after marriage and family members with shared names may further compromise the integrity of the data the bank receives.

In any case, the information doesn’t add up, and the bank doesn’t know if it’s just a data-reporting snafu or fraud.

“That’s just the nature of the business,” Haney says. “The banks, when they encounter those situations will say, ‘Hold on, there’s conflicting information here. We’re not really confident about this particular report, so let’s take a closer look.’”

These kinds of data anomalies also may explain why you’re instantly approved by one issuer and then punted to manual review by another the same day; the former could be pulling from a credit bureau that has cleaner data for you.

4. You’re on an app spree

Your intentions may be innocent when you apply for several cards in quick succession. But banks have seen too much.

“Think about it this way,” Haney says. “If someone had stolen this person’s identity, what do you think they’re going to do? If there are a bunch of inquiries appearing on someone’s file in a very short period of time in combination with other [data] mismatches, that’s clearly a fraud risk.”

What to do while you’re in manual review

Promptly provide all the information the issuer asks for. If you are asked to wait seven to 10 days with no request for additional documentation, you might try calling and asking why your application is being held up. Often however, the issuer won’t be able to give you an answer until an analyst has had time to perform a review. So sit tight. And if you’re rejected, you can always try the reconsideration line.

Editorial Disclosure: The editorial content on this page is not provided by any bank, credit card issuer, airline or hotel chain, and has not been reviewed, approved or otherwise endorsed by any of these entities. Opinions expressed here are author's alone, not those of the bank, credit card issuer, airline or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.