Credit Cards and DTI (Debt-to-Income) Ratio

[IM2Bee924]

Hello everyone, I am a graduating senior and was interested in obtaining another credit card for relocation and moving costs for the next few months. So I applied to two major credit card companies for a 0% intro APR deal and was declined on both due to a very high DTI. This takes into account my 200k+ student loans and my upcoming resident salary. Credit score 680 with no late payments or other negatives on credit report.

How did you all get around this issue? It seems I am hopeless and will never be approved for a credit card until I repay all my loans. The companies literally had no idea how to navigate around the issue even if I tried to explain that I would not be making 2k+ monthly student loan payments due to REPAYE. Are creditors really this ignorant towards students loans and the repayment system?

Any help is appreciated!

---

Members don't see this ad.

 

[NYCNative]

You just need to start with a few cards targeted for your stage of life (may not have 0% interest; may have low credit limits), but the student loan debt won't be an issue in general. You will definitely be declined if you declare zero household income, though.

Your ability to obtain good cards in the future will definitely be impacted if you are carrying even 2k of debt across 2k of credit card credit, because you will have a debt utilization rate of nearly 100%. So, the more credit/credit cards you have, the better for obtaining new credit. You want to keep your overall credit utilization rate under 10% ideally, under 30% if at all possible. Use credit karma to track these things.

Use this site to find cards:
Best Credit Cards of 2017: Reviews, Rewards and Offers

Apply for 10 on the same day; after three months, the dings to your credit score from the credit inquiries are removed, for the most part (inquiries stay listed on your credit report for 2 years, but your score goes back up three months later and credit card companies don't seem to penalize inquiries older than 3 months). Apply to ten more cards 3 months later, and then again three months later. Get it all out of the way now. In ten years, your future self will thank you (your average age of credit accounts will be very old, and hard to pull down, and your cumulative payment track record will be long and spotless).

Sign up for mint.com to keep tabs on your accounts (just to make sure everything is always at zero), and make sure that all your cards have automatic payments set up with your bank, in case you ever forget to pay them.

Try not to go into credit card debt, though -- you don't want 5k hanging over your head during med school and residency.

 

[sweetlenovo88]

Take it as lesson, it is better not to have a credit card and stay debt free. Find another way to make some money for the move, I heard uber is hiring.

 

[dpmd]

You will be able to get a good card when your income rises. You might be able to qualify for a student card that isn't going to have nice perks like an introductory rate,but yeah the credit card companies don't care so much that you will be able to qualify for a lower loan payment. They only care about the likelihood you will be able to pay all your debt. High student loans plus loan resident salary isn't going to give them the warm fuzzies. You might see whether you qualify for any additional student loan funds and I second the idea of trying to get temporary work. It is only april and you won't be seeing any resident pay until probably mid july. If you didn't plan ahead and cut costs so that you could have some savings for this time you will need to figure out how to get money and credit cards aren't likely going to help since you still need to make minimum payments on them.