In the past, CapOne was more than happy to give you a credit card if you had bad credit. Then when you wanted an increase, you would be told to simply apply for another one, as the card was established with what your profile was then. They knew that most people would simply do this thinking there was no other way. Their plan was to get as many annual fees as they could from customers. Now, since a very large portion of their cardholders were either new or had damaged credit, they had another plan which fit into the multiple annual fee plan. That was the late payment plan. If you were late on one card, it was likely that you would be late on another one, once adding up to more fees. Tied to this was the overlimit fee plan. Many accounts with them, with small limits would increase the likelihood of multiple over the limit fees.
Look at the math: 1 card with a $39 AF = $39 of fee revenue. 5 cards with a $39 AF = $195 of fee revenue. $39<$195..... (There was legal action over this practice and they did pay a huge fine for it!)
They did end the practice of allowing you to have many cards over this. However, there were other reasons why they did it. One is AAoA. If you applied every six months for a new card with them, your average age of accounts would stay low, meaning your score would stay low. This in turn meant that other lenders would probably not accept you. Low limits are also restrictive and might be looked on as an issue with other lenders. If your 3 year old account has not been given a higher limit, what did you do wrong or why should we start you off at a high limit? Also, the low limit would affect utilization. With a $300 limit, the best scoring of your file would happen by only using $30 of your limit, the next best would be under $60, etc. This low limit would mean that most people would be fairly regularly above the 50% or even near the 80-90% mark. Even if you paid it off before the due date, the damage to the score is done.
So the card levels were basically split into two categories; low and high. Look at the types of cards and annual fees. Most banks don't offer to the midrange people a card with an annual; the average category basically matches the rebuilding/poor credit category. If you try the card match site there and you put in that your credit is average, the card that is recommended is a $39 AF card. If it actually checks your credit report with a soft pull then it might recommend something better, but it also might simply offer you the fee card, thinking you might accept it. If you get offered a fee card by doing it and you think your credit is much better than actually paying a fee to have a card, then app instead for one of the higher tier cards without a fee. The worst thing that can happen is that you get denied and have to accept a different product.
Yes, they are and have changed their practices, but they still find ways which might not be the most beneficial for them in getting and treating clients. Yes, it is true most people don't know that they can go the EO route and simply stick with them. I do hope they get better in the future, because for a general use card, the 1.5% cash back is pretty good, however, my PNC card is 1.75% for everyday use. So they get more of my business now because of that! (Not everyone can have the 1.75 with PNC, sorry.)
I think now they are simply looking to give CLIs to those who use the cards a lot and pay off or make higher payments to the account. I got a message once basically that said the usage verses the payments was not proportional. (I loaned the account to my niece, she was paying the bill, but not paying it off in full.) So I transferred the balance, through spending to my new CapOne Signature account and then asked for an increase in the limit. Bam, done. And yes, having a Signature card with them does give you better customer service reps, but it shouldn't. For the most part, customers are customers.
It is by will alone I set my mind in motion.....
Always follow these rules: Only take a HP for a new account. Always use the best rewards card for that reward category. Don't close a card unless you know you really should. Never use more than 35% of a credit limit. Recon as much and as best you can. Use the introductory period to the best advantage. Get the signup bonus. Whenever possible PIF or balance transfer so you pay less in interest. Never give an excellent rating when it is actually the norm. Always look for a discount as more is always better.
Always accept candy from strangers because they have the best candy or from people you know have good candy.
