Account closures, adverse action and general thoughts

[Anonymous]

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@SouthJamaica wrote:

I disagree with your entire argument.

Banks enter into a deal with us, and being bigger than us, they set the terms, so they should be comfortable with them.

If we hold up our end of the deal the banks should hold up theirs.

Perceived self protection is never an excuse for a bank's dishonoring its obligations.

If the customer breaches his or her agreement with the bank, the bank is justified in pulling the rug out.

Otherwise it is not.

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I think LTL has replied to your post as well as I can but I will say that it shows another negative. Far too many card holders never even glance at the Card Holder Agreement that governs their account. As stated either side can walk away at any time for any reason. It's all in the agreement.

[Anonymous]

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@AverageJoesCredit wrote:
I need 50K on my Discover if only to say ive discovered the key to Discovers cli process

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OK but don't end up like Icarus

 

[sarge12]

I personally feel the banks have the right to cut the CL or close cards for any reason or no reason, as they should. I as a consumer also have the right to sever the relationship for reason or no reason at all. I think AA such as CLD is sometimes done not because the customer represents greater risk, but as a means of risk reduction across the board, or to free up capital for more profitable segments of the market. The highest scoring profiles are sometimes the least likely to be very profitable to credit card issuers due to low utilization and that many are strict transactors such as myself. I may not like it if they take AA against me to free up funds for more profitable customers, but I do understand why they might choose to do so. I have never felt it was my right to carry their cards, but I use the cards in such a way that any AA taken will only have a minor impact on my credit in any case.

[Anonymous]

The OP has said, or put into words, pretty much all of the arguments I've been making over the past few weeks. @longtimelurker also makes an important point that probably isn't often thought about, to-wit that the active people here are, in fact, pretty much outliers as far as the general credit-using population is concerned. For instance, I think that while a lot of people have heard about the 30% utilization target and do their best to keep as close as they can to that, I doubt that most people are as, well, passionate about keeping utilization to the absolute minimum and PIF'ing on everything as some of the folks here. Also, I suspect that most "normals" aren't as on fire about expanding their available credit to the maximum possible (a lot of people may not even know there's a facility on their account pages to apply for increases in credit lines) as the active community here.

[sarge12]

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@Anonymous wrote:

@Anonymous OP has said, or put into words, pretty much all of the arguments I've been making over the past few weeks. @longtimelurker also makes an important point that probably isn't often thought about, to-wit that the active people here are, in fact, pretty much outliers as far as the general credit-using population is concerned. For instance, I think that while a lot of people have heard about the 30% utilization target and do their best to keep as close as they can to that, I doubt that most people are as, well, passionate about keeping utilization to the absolute minimum and PIF'ing on everything as some of the folks here. Also, I suspect that most "normals" aren't as on fire about expanding their available credit to the maximum possible (a lot of people may not even know there's a facility on their account pages to apply for increases in credit lines) as the active community here.

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I agree...we ask for CLI's in order to easily control utilization, resulting in a large amount of unused credit. We should really not be surprised when this activity, which many of us take to the extremes, results in AA's. The issuers motivation for increasing the CL is in hopes of greater us of the cards, not to help us achieve higher credit scores. The public at large has no idea how to do this...we are in a way gaming the system...we know what is in the score, and use this info to our advantage. Many of us also reap the greatest amount of rewards we can while never paying a penny in interest. It greatly benefits us, but provides almost no incentive for the issuer to not take AA against us, as we are by design less profitable to the issuer. If we are honest, we should admit that we push our luck somewhat.

[JRAGS28]

Very nicely written .... Job well done.. Thanks

[Anonymous]

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@AverageJoesCredit wrote:
I need 50K on my Discover if only to say ive discovered the key to Discovers cli process

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Greedy

[Anonymous]

Well the problem today is is that college kids are going to lie about their income to get spending money to do what they do. Now credit card companies rarely ask for proof of your income. But credit card companies only are making money off of you because of interest. Now what hurts you is when a college kid maxes out his credit card and closes his account(because he dont care). One that pays his bills on time but carry a balance etc are what credit card companies like. They still make a profit off of them. Everyone in college has lied about their income. No need to take shame to it. Because I gaurantee 85% of people did it. No red flags are thrown up if you pay your bills on time, carry a little balance, and dont apply for 5 cards a month. 

[longtimelurker]

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@Anonymous wrote:

But credit card companies only are making money off of you because of interest.

 No red flags are thrown up if you pay your bills on time, carry a little balance, and dont apply for 5 cards a month. 

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Well, cccs still make money off swipe fees (and annual fees for that matter), while interest is good, it is also a risk for them (as there is a balance outstanding)

To avoid AA everywhere with your method, you would need to do this for every card, which can impact score and cost some if you have too many cards.

Plus, there are certainly other things that could cause AA even if you were doing this

[Anonymous]

Many good posts on this topic. My thoughts 1) When the bank gives you $xx they have to set up reserves to cover this. If you don't use this account it still costs them money.

2) The banks business is to loan money not provide unused loans. 3) Many people in this forum are very aware of score max. and will add extra cl to keep themslves below 29% and 9% respectfully  5) Some of these limits are beyond reason and never should have been granted in the first place  6) Some banks try to  match cli for cli with other cards .  This happened with my DW She has asked for virtually no cli but gets auto cli every 6 months  7) The total amount of credit on some of these is impossible not just the one $45K credit card  but the fact the person has $450K  in card credit limits. Can you imagine trying to pay this off? We owe no house payment no car payments and have a business that generates 6 figures a year. It would take us many years  to we had these total limits to pay them off. If the person had a car and house payment the task would be 20 to 30 years. At that point to not a credit card loan its a lifetime loan. If I were a lifetime lender I would want more docs    8) I for one do believe the card co should trust the computer to set the limts in many of these cases as many here know how to game the computer for better cli. Starter cards great computer sets but cli have the credit looked at manually.  

I know some of the actions here at the Backwoods house would cause alarm. We had $500K in our checking account for months  while we were looking for our current house. We spent over $20K  one weekend our our debit card when we redid our kitchen.(Had to call in for ulimited use over the weekend)

Yes we did get balance chased and cld from 2006 to 2009. As we paid down they reduced and finaly we closed.  This was not one card it was several. Every month another $500 to $1000 to cover the cld so we would be under limit. The final result was a debit card and nothing else. It was the most miserable times of our life. Our income for most of thime was terrible also.