Certain Transactions Can Hurt You?

[Anonymous]

    I recall reading an article somewhere about how a credit card company was risk profiling people based on their type of purchases in addition to the normal criteria like credit utilization % etc.  I'm not sure how widespread this practice has become.  I believe stuff was mentioned like going to a tire retreading place, or spending a lot of money in bars, was mentioned as potentially flagging you a a risky customer.

   Now has anybody had any experiences with this? Let's say you ordered an "adult product" with your credit card.  Could they actually look at the transaction and say "hmm looks like a risky customer" and then lower your credit line?  Has anybody had this happen?

[pattycake]

I have heard about this - I believe it was only with some of the subprime products that would monitor which stores you shopped, and certain ones would trigger a credit "risk" and they would lower limits or close the accounts.  Anyone else?  I may have seen this on MSN's money site.  

[Anonymous]

I actually did just have something like this happen to me. I decided to give the EQ score watch thing a try and pulled my reports last week. For the first time ever I saw a reference to a company who I had a loan with when I purchased my daughter's bedroom furniture about 4 years ago. The finance company was considered a subprime lender and I got hit for points because of it. Forget the fact that that's who the furniture store went through for financing at that time (they've since started using wells fargo). And the furniture store itself is one of the better ones in town. I thought it pretty much stunk.

[Anonymous]

AMEX has been doing this for quite some time.. lots of people getting axed for shopping at walmart.  I can understand this profiling to an extent, like for instance, a customer is taking out a big cash advance in vegas.  That makes sence that this person could be high risk.  But walmart???? come on...

[Anonymous]

Check out this link.

AMEX targeting Wal-Mart customers to shut off their cards?

[Anonymous]

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@Anonymous wrote:
AMEX has been doing this for quite some time.. lots of people getting axed for shopping at walmart.  I can understand this profiling to an extent, like for instance, a customer is taking out a big cash advance in vegas.  That makes sence that this person could be high risk.  But walmart???? come on...

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If you read the boards carefully, you will see that shopping at Walmart alone seems not to cause adverse action. It's often a combination of factors. Or changing patterns: Let's assume that you normally buy your food at Whole Foods and suddenly switch to Walmart for this purpose. In this case, it would be reasonable to assume some financial difficulties.

[Anonymous]

Or a walmart popped up between your house and whole foods.  I have read many many many times where people were told that the got a CLD because of where they shopped, and they have always shopped there, not a sudden switch. 

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@Anonymous wrote:

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@Anonymous wrote:
AMEX has been doing this for quite some time.. lots of people getting axed for shopping at walmart.  I can understand this profiling to an extent, like for instance, a customer is taking out a big cash advance in vegas.  That makes sence that this person could be high risk.  But walmart???? come on...

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If you read the boards carefully, you will see that shopping at Walmart alone seems not to cause adverse action. It's often a combination of factors. Or changing patterns: Let's assume that you normally buy your food at Whole Foods and suddenly switch to Walmart for this purpose. In this case, it would be reasonable to assume some financial difficulties.

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[Anonymous]

The walmart thing....does anyone else have this message when they log into their American Express Account:

Click here to earn triple points.

Just curious?

[Anonymous]

Yeah thats the funny thing, I heard about AMEX rewarding for walmart shopping before, but I couldnt remember the details.

[Anonymous]

the profiling process sounds very prone to error and false positives.  I put a 50cent charge on my credit card at a convenience store to buy a newspaper.  I had left my cash in the car and didn't want to go back outside to get it and wait in line again.  I wonder if the credit card company saw that and flagged me as risky because they assumed I was so overextended that I didn't even have 50cents.