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@Revelate wrote:That's interesing Dustin, where did you find that?
I googled "amex merchant fee percentage." That was in one of the results.
The fee will differ with different processors, but I thought that one broke it down pretty well.
Amex may offer revolvers in order to stay competitive, but at their core they are still a charge card company. All of their algorithms were perfected in the charge card market long before being adapted to the revolving credit market. As a result, the system is still biased towards both a spend-centric model and a PIF model. That is just reality. If you are someone who carries balances long term, the Amex products are not the best choice. OTOH, Citi loves that sort of pattern and will reward you with growing limits over time. For those of us who PIF routinely, Amex rewards us better than companies like Citi.
@drsmith wrote:Amex doesn't like it when you carry a balance.
I'd say you're lucky they didn't close it.
I would have to disagree with that. I carried about 20% balance on my BCE for a while and never got CLD
This is an interesting thread. Because of the anecdotal info on the forums, and my personal needs, I have never carried a balance on AMEX. However, I have other lower interest options if I needed to carry a balance. AMEX recently had a survey they emailed to cardmembers, mine was specifically about my PRG (which I am seriously thinking about closing in Feb, when the AF hits). The questions were all geared towards carrying a balance (I have the extended pay option - or whatever they call it, since I never use it). They asked about what cards I used most often, and if I carried a balance from month to month. They also asked why the AMEX card was not my first choice to use. They seemed to be focused on getting people to carry a balance with them. There were questions like, "are you aware that you can carry a balance on your PRG with a low interest rate of 15.24%, " etc. This being said, because I rarely use my AMEX's for larger purchases (over $1500 at a time), I usually would not need to carry a balance.
This a perfect example of how a card issuer may treat one consumer one way, then do the exact opposite with someone else. I don't know if their actions can be understood. Everytime I see one of these threads (about AA by an issuer) I go check my accounts, out of habit. There does seem to be some correlation between increased utilization/carrying a balance and AA/CLD's (by some CC issuers), just based on what I read on the forums.
It's important to bear in mind that OP had a balance of $2000 on the card "a few years back" which was only recently reduced to $1200.
I don't think it takes any special "AmEx weirdness" to explain this particular case.
Any creditor is going to get wary if it takes you ~3 years to make an $800 dent in your balance, and that's still less than half of it.
Emptypockets is correct, though, that AA by a lender is often personalized to a particular borrower. There's a lot more to your risk profile than you may realize, especially with AmEx, who serve as both the issuer and the network. They have a lot of data on their borrowers, and I am sure they are constantly crunching the numbers on every dollar you spend, pay, or carry. A lot of the time, AA like this is not a simple cause-and-effect (I carried a balance higher than 60% of my limit therefore they balance chased me with a CLD), but is more of a complex function of many variables. (A + B to the power of Q over X = Z. If it's a sunny day and Z is an odd number, you get a CLD )
All the anecdotal evidence in the world isn't going to make it a sure thing that we can engrave a rule like "Carrying a balance with AmEx is fine as long as it's for less than 6 months." Every anecdote is coming from a different person with a different credit history, income, employment history, spending pattern, and specific history with AmEx. It's virtually impossible to generalize.
What can be generalized are basic rules of sound financial management of your personal credit. One of those is: carrying a balance long-term - with the sole exception of a 0% APR period - is not good for your credit profile or your long-term financial health.
OP, I know it sucks, and I've been through it myself. Bank of America chased me down from $2000 to $500 with CLDs, and I wasn't even carrying a balance. But I'm sure I was doing something that set off warning bells in their spreadsheets. So all I can do - and all I can advise you to do - is continue to manage my credit as prudently as I can and hope that they take notice.
If you want to try to recon the CLD, I don't have direct experience of doing that with AmEx but I expect you'll get the best results by first paying the balance down to zero, and then calling them as soon as humanly possible after the payment posts. You want to catch them before they have a chance to do another CLD and talk to them about returning you to your original credit limit or at the very least stopping their chase where it is.
Best of luck to you!
So let me get this straight. You borrowed money from someone (Amex), paid it back very slowly (2yrs), and then started asking other people for money too (Nordstrom/Penfed)?
Put yourself in their shoes. If you lent someone a bunch of money, how would you act if they took forever to pay you back and then asked other people for money before paying you back? I'm sure you'd probably be a little concerned, and might hesitate to lend them a lot of money anytime soon again...or ever again.
Amex is pickier than most. Whether they are worth the "hassle" is up to you. If you treat them like a prime lender, they'll treat you like a prime borrower. If not...well, this is what happens (or worse).
@Anonymous wrote:So let me get this straight. You borrowed money from someone (Amex), paid it back very slowly (2yrs), and then started asking other people for money too (Nordstrom/Penfed)?
Put yourself in their shoes. If you lent someone a bunch of money, how would you act if they took forever to pay you back and then asked other people for money before paying you back? I'm sure you'd probably be a little concerned, and might hesitate to lend them a lot of money anytime soon again...or ever again.
Amex is pickier than most. Whether they are worth the "hassle" is up to you. If you treat them like a prime lender, they'll treat you like a prime borrower. If not...well, this is what happens (or worse).
a little bit apples and oranges, isn't it? How many "other people" that you borrow money from, charge interest?