Maybe you misunderstood what this meant. As of right now, the wording says:
Lowest Credit Score Approved for this Card: 546
That does NOT mean that as long as your credit score is above 546, that you will be approved. It means that the LOWEST credit score anyone has ever had and STILL been APPROVED despite that low score was 546. So in other words, that was the absolute worst case scenario (or best case scenario, if you were this applicant).
Again, as the other figure says the Average Credit Score for this Card: 681 (at the time of my post). So that means the majority of the people who were approved had a credit score closer to 700 on average.
Of course the simple raw number of your credit score has only a partial bearing on your approval or denial. It is only used as a quick glance reference. When considering an application, these credit card companies have flags set in their system that will put up a warning on screen to the customer service person (my ex used to work in this department). Often, they are not the ones making the decision, personally-- they have to go by what the computer's formula spits out... approved or denied. There are complex software algorithms that do all kinds of behind the scenes calculations to weigh risk and factor so many things in. Trust me, it's very calculated and coordinated-- not to mention, mostly automated. It will flag you for conditions like these, for instance:
If your overall credit utilization is over 90%
You have 1 or more late payments on record
You have a limited credit history
All of these things are considered derogatory, and will often outshine a simple credit score number. It's your spending (or more importantly, your repayment) habits that matter far more. These companies want to make sure they're going to get their money back both on time, and in full. They don't want to risk giving thousands of dollars of credit to those who may rack up $5,000 then default on the card (bankruptcy, non-payment).
Financial institutions are out there to make money, just like any other business; just consider this: Would you loan $5,000 to a stranger who you didn't trust 100% to repay you? That's exactly what banks do-- keep that in mind. Nobody is out for your head, it's business; plain and simple.
Your application result is merely what a computer spits out. That's why companies have departments that you can ask for reconsideration of a denied application. Since the computer terms are rigid and do not flex for extenuating circumstances, people who shouldn't truly be denied can be turned down (and are, quite often). These reconsideration agents are when you have a human being actually manually looking at all of the data you see here on Credit Karma. They are flexible in their decisioning and can make exceptions that the automated 1st pass process will not. As the review I just read shortly ago about the person who had perfect payments, but their credit history was less than 2 years, and they were denied 3 times they said. Good example of an exception to the process.
So no need to blame Credit Karma's website -- guess what? Its "recommendations" and "likelihood that you will be approved" are doing exactly the same thing-- basing that advice on your credit information vs. their statistical information of profiles of people who were approved or declined. It's also just a computer running formulas and calculations and comparisons. Computers are flawed just like humans without a concrete set of rules to go by (in essence, they are making an "educated guess"). Those aren't always perfect-- because they're still "guesses".
aspiration's reply was:
Yeah, unfortunately there are set time limits for resolving disputes and contesting charges. This is federal law, not mandated by individual credit card companies. I'm embarassed to say that I used to work indirectly dealing with these rules, laws like FACTA, FCRA, and other laws that define and protect consumers from fraud and identity theft. EFTA will also probably be of interest.
Here's a PDF file (also available in .mobi and .ebook for eReaders) — It's called the 2011 Consumer Action Handbook and is an invaluable resource to 1) Read through to know the can's and can'ts, what protections you have, and what actions you can take to fight back 2) Keep on hand for reference in the future. It has general, wide scope of knowledge concerning fraud in different industries (auto/term loan financing, home/mortgage, and general consumer credit advice for all situations.) Start by downloading that PDF file, it's free and it'll help educate you a bit more.
Another essential resource you should have bookmarked is the FTC's consumer rights page. This covers the gambit of topics in all areas, and actually tells you procedures of what to do down the list if this fails, then contact local BBB as scamps said. Those resources are awesome to have in one place, and you can get to them here, on the FTC's site:
You essentially have two time periods where this can be handled. One, is immediately as the transaction goes on, I believe the bank would issue a CHARGEBACK where they basically reject the transaction against your account. Their bank has a limited time to dispute it and say "hey, I disagree" and the dispute goes one more round. If they don't respond or challenge the chargeback, then you win and the money goes back to your account. This all takes place pretty quickly... within a statement/billing period, maybe 45 days, if that even.
If the charge goes through and there's no chargeback and resolution there... then you basically are stuck with the charge; it's at that time you have to go to more pain in the butt resources to do this. There are third party mediators that will oversee a case... or if it makes it all the way to posting a derogatory or unpaid debt on your credit file, you can always go through that process of appealing a "fraudulent" mark on your file. Errors do happen, quit often, and the dispute and resolution process is well documented, I think those two links alone should get you headed in the right direction as you know where you stand in time and details better than anyone.
Let me know if those links/documentation are helpful to you. It's a wealth of great information, like I said, all in one spot. Hopefully you can get this taken care of, fraud sucks (I've had fraud on my card, random/stranger; I would never have purchased anything from the merchant they were using, and it was done from several states away... thankfully... Chase handled the dispute and I guess found out that it was indeed fraud, otherwise I'd be in your shoes... about $1,000 in the hole for someone else's good time. No sir... People start stealing my money and I'll fight them to the death with every resource I have — and thankfully, you have a lot of resources as a consumer to protect yourself, since unfortunately... fraud abounds these days and is an everyday thing for these companies to deal with. Your case won't be the first.
Just make sure you leave a paper trail. Keep copies of all receipts, documentations, copies of any emails or coorespondence between you and the merchant; and any dispute or challenges need to be sent via certified mail, so that you can prove that they received these dispute letters and failed to respond, or responded untimely, etc. Build your evidence up, it's a trial, and it's going to be your word against theirs — who is going to be better prepared? If they're sloppy and don't take the care to document and go to all this work... you may win just by the fact that you can prove these things, and they don't have anything to backup their claim of a bad debt. Good luck. Update this if you would, I'm sure others could benefit from your experience and steps that you take (and hopefully ultimately a positive outcome.)
Oh, and don't forget the http://www.fdic.gov and another good resource http://www.privacyrights.org
Hope that helps you out, my friend.
aspiration's response was: