What a decline actually means
A lender said no and blamed your credit. Here is what they are required to send you, what it will and will not tell you, and what to do with it in the first week.
A lender said no and used the word credit. It is a bad afternoon, and the worst part is usually that nobody tells you anything specific. That is fixable, because the law requires them to tell you a good deal more than they did on the phone.
What they have to send you
When a lender takes adverse action based on a credit report, FCRA 615 requires them to give you a notice. It has to name the consumer reporting agency they used, and it has to tell you that the agency did not make the decision and cannot explain it. Crucially, it also has to tell you that you can get a free copy of that report within sixty days of the notice.
That free copy is separate from your annual free reports. It does not use one up. If you were declined, get it, and get it from the agency named in the letter rather than from wherever happens to be advertising.
What the notice will and will not tell you
Most notices include a list of key factors that affected the score. They are generic and frustrating: length of credit history, too many recent inquiries, amount owed on revolving accounts. They are still worth reading, because occasionally one of them is a surprise, and a surprise is a lead.
What the notice will not tell you is whether the underlying information is correct. That is the part nobody checks, and it is the part that is sometimes wrong.
The first week
- Get the free report the notice entitles you to, from the agency it names.
- Get the other two as well, free, at annualcreditreport.com. Items sit on one and not the others more often than people expect.
- Read all three with a pen, looking for accounts you do not recognise, wrong balances, wrong dates and the same debt appearing twice.
- Separately, ask the lender what their cut-off was. They do not have to tell you, and sometimes they do.
The thing worth knowing before you spend money
If everything on the report is accurate, a decline is not a credit repair problem. It is a time problem, and the answer is the boring one: the negative items age off on a schedule nobody can change, and paying somebody to write letters about accurate information is money you will not get back.
If something on it is wrong, that is different, and you can dispute it yourself for the cost of postage. The whole method is on this site, and there is nothing in it we hold back for paying clients.
What a decline is not
It is not a verdict on you, and it is not permanent. It is one lender's rule applied to one snapshot on one day. The useful response is not to feel it, which you will anyway, but to get the three reports and read them properly. That is a free afternoon that occasionally finds something worth a great deal.