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Valued Contributor
Posts: 2,039
Registered: ‎01-24-2012
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Re: Amex Payments

HenryJumbo wrote:

jamesdwi wrote:


During the first month after you have setup your bank account you can't make more than one payment unless a payment is due. But you can push money to AMEX as much as you like from your bank account. I don't think they care. In fact some people that had hard limits were forced to make weekly if not daily payments to stay under the limit. Not sure how AMEX internal scoring system rates multiple payments. The one thing AMEX does hate is carying a balance on revolvers from month to month.  



I don't see how that would make sense. So in other words Amex, a company known for charge cards, creates and issues revolvers, but god forbid if you carry a balance on a product designed to carry a balance. Now if you said Amex hates high balances, or multiple balances then maybe what you said would make more sense.

American Express is silly like that. You will find stories of people having limits reduced for carrying a balance for just a few months. I kept a balance up to the limit while it had no interest and wasn't really concerned if they closed the card or reduced the limit.


youngandcreditwrthy wrote:
Yeah, I agree! I love that it posts right away to my avail cred!!
From a credit risk standpoint, it makes sense that they'd allow this given that they cater to customers who are a better credit risk generally...
Ive never even gotten near my limit though! Lol

It's great but in my opinion it is very risky to do such. I once made a payment to free up the card and was able to charge again a few minutes later. Someone could easily use this to buy things with money they don't have and I am sure someone has done such before. Other lenders make the same risk when they credit it the next day, but that's not the same as instant.

Super Contributor
Posts: 6,236
Registered: ‎02-23-2011
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Re: Amex Payments

[ Edited ]

Amex isn't known to be "balance carrying" friendly.  


Now, having said that, just because it isn't their forte, it doesn't necessarily mean you can't or shouldn't use the option of carrying a balance.  From what I've seen, if your balance seems controlled, not increasing and consistently making 4 or 5 times the minimum payment, there aren't any issues carrying a balance.  


Where trouble starts to brew with Amex is if you suddenly start making *only* minimum payments for a prolonged period combined with increasing debt with them and other issuers.  This is where Amex doesn't have the intestinal fortitude to continue allowing a balance carried, unlike Citi whose more experienced and much more comfortable with higher balances.


In Amex's business model, the only reason they can see for a person to make minimum payments at exhorbinant interest is if he's in financial trouble.  Many lenders can stomach this and understand this is part of having a "credit" card.  Not Amex, who still follows closely to their spend-centric model.  They mean well when it comes to revolvers, but have issues staying true to their promise of balance carrying at the first sign of financial uncertainty.


When this happens, they start to balance chase, lower limits from $15K cards to $1,000, and sending out $300 bonus gift cards as an enticement for these cardmembers to pay off the balance and cancel their accounts.  In other words, they want to be the first one out the door and leave it to others holding the bag.


You can't fault the strategy, since Amex does have the lowest default rate in the industry.

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