Like many, I applied for the Chase Sapphire Reserve. Like many, I was denied. Like many, I’m a “tad” over 5/24. It’s hard to fault Chase for the denial. Despite my healthy income, high credit score, impeccable credit history, and nearly zero utilization rate I’m probably not who they are looking for. I am not going to be profitable for them. They are giving away over $2000 for each sign up so I can’t blame them for trying to weed us out. But I will not be deterred.
I’ve made it my mission to get pre-approved. In my hunt for pre-approval I’ve learned a few things I thought I would share.
Long story short I talked to a guy at a bank who told me that pre-approvals in branch have nothing to do with the pre-qualified offers found on this link. For pre-approved offers in the branch he gave me some insight into how these work. Before I list it all out, let me preface this by saying that this was a quick and casual conversation. I was not taking notes and did not ask him to clarify things. I was trying to be nonchalant.
Mr. Banker told me that Chase does a soft pull on all their customers every six months to determine creditworthiness. By all customers he very well may have meant ALL customers but that seems like a lot of credit pulls. So I am assuming he meant those with non credit card accounts with Chase. I would be curious to know if folks with only a credit card relationship have received a pre-approval from Chase. The other factors are:
- Credit worthiness
- Chase relationship
- Cash flow*
- Debt to income ratio**
* I believe what the banker meant by cash flow was how much money you have coming in and out of your Chase account.
** This last factor was a little interesting. It sounded like during our conversation that the banker meant not just the traditional meaning of debt to income ratio but also the ratio of available lines of credit to income. Specifically he used as an example “if Chase sees a line of credit for 75k that means you could run up 75k in debt.” The banker also mentioned that they look for this to be under 50%.
If he was talking about both the available lines of credit and debt to income being under 50% that makes sense to me. It is commonly believed that 50% of income is the max credit line Chase will extend to you. Seems logical if they see you over 50% they are unlikely to pre-approve you.
Who knows, this could all be bullshit from a banker trying to sound like a know it all, but I thought what he said was interesting and had some merit. Enough merit worth sharing.
My next step for Chase’n pre-approval is to see if I can improve upon these factors and see if it makes a difference. First, does anyone want to give me 100k to pay off a student loan?