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Credit Card Secrets

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CreditBob
Established Contributor

Credit Card Secrets

I know that some of you have had your credit limit on your cards reduced when you have done nothing wrong. You always make your payments on time or have low balances that do not exceed 30% of your utilization. The credit card companies are not telling you why.

 

I tell tell you the reason for this. I took the time and called three of the major credit card companies. Here is what they told me. It has nothing to do with having low balances or paying off the cards in full each month. The first reason is a change in employment were the income has been reduced. And the second or most popular reason is the lack of using the credit card. Every time that you use your credit card the financial institution makes money off of the merchant or retailer. It is called the transfer or merchant fee. For the credit card companies that issue you a line of credit they want to make money off of you.

 

So here is what you can do. Just start using your cards more often instead of using cash. Now make immediate payments on your credit card accounts. This way you either pay no interest or if you do then the amount is very small. Again you do not get penalized for paying your accounts off in full each month.

 

Here is another good example of what is going on. Banks and credit unions are starting to offer a savings account account with a rate of around 3.6%. In order to get this you must use your visa debit card 12 times within each month. Again this is were the merchant or transfer fees come into place. Each time you sue your card the merchant or retailer has to pay the financial institution a certain percentage of the sale or what is known as the point of sale (POS). In other words the merchant is helping to fund your 3.6% interest rate.

 

 

Message 1 of 10
9 REPLIES 9
Anonymous
Not applicable

Re: Credit Card Secrets

Good reading thanks
Message 2 of 10
Anonymous
Not applicable

Re: Credit Card Secrets

Hi CreditBob,

 

Which major companies did you contact? I'd be interested to know.

 

thanks!

 

Sakinah

Message 3 of 10
wmarat
Valued Contributor

Re: Credit Card Secrets

Who offers 3.6% APY savings account?
IN VINO VERITAS.
Message 4 of 10
Anonymous
Not applicable

Re: Credit Card Secrets


@wmarat wrote:
Who offers 3.6% APY savings account?

I think he's talking about high-yield checking accounts, given the required debit card use. There are quite a few of that kind, but they require you to jump through hoops. Savings accounts usually end in the 2.x% area.

Message 5 of 10
CreditBob
Established Contributor

Re: Credit Card Secrets

Chase, Amex, & Citi.

 

https://www.bankaf.com/    my local bank but you have to use your visa debit card a minimum of 12 times within the month along with a couple of other requirements.

Message 6 of 10
Anonymous
Not applicable

Re: Credit Card Secrets

I dont believe that's any secret at all.

" The first reason is a change in employment were the income has been reduced. And the second or most popular reason is the lack of using the credit card."

 

Change in employment doesn't mean that cardholder will max out their credit card ~~ there is no way the lender would know this. Unless the cardholder call in and tell them, I lost my employment and I cant pay anymore. WOuld anyone do this?

 

Secondly, if you dont use your cards, obviously they will close the accounts. THere is no secret about this..

Message 7 of 10
MattH
Senior Contributor

Re: Credit Card Secrets


@Anonymous wrote:

I dont believe that's any secret at all.

" The first reason is a change in employment were the income has been reduced. And the second or most popular reason is the lack of using the credit card."

 

Change in employment doesn't mean that cardholder will max out their credit card ~~ there is no way the lender would know this. Unless the cardholder call in and tell them, I lost my employment and I cant pay anymore. WOuld anyone do this?

 

Secondly, if you dont use your cards, obviously they will close the accounts. THere is no secret about this..


American Express has never asked me to state my income, because I got my card in 1982 just after getting my BS degree.  On my other cards, they asked me what my income was at the time, and I told them, but I got all my cards more than 10 years ago so there is no way they can know my current income.  On all my credit cards and car loans, their only source of income data was what I myself wrote on the application, the only lender ever to have checked with my employer and/or the IRS was for a mortgage.  I think one landlord over 25 years ago did call my boss to verify employment.

 

Message Edited by MattH on 05-31-2009 09:38 PM
TU 791 02/11/2013, EQ 800 1/29/2011 , EX Plus FAKO 812, EX Vantage Score 955 3/19/2010 wife's EQ 9/23/2009 803
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If you dunno what tanstaafl means you must Google it
Message 8 of 10
Anonymous
Not applicable

Re: Credit Card Secrets

Yeah I understand and I agree. When you are approved for your credit card, you are responsible for all of yours action. You are responsible for your credit, why would the lender care how much money you make or not. Everyone income fluctuate either more or less. You make more money doesn't mean you'll use your card more, or you make less that you'll max your card. They ALL know you have to make money for a living, obviously, however regardless of what you are still responsible for your credit and what you owe to them. They job is to lend you money and that money is come from your taxpayer money. What do they have to lose? Nothing....

 

Live Within Your Means and You Use Card or Lose it.

 

Message 9 of 10
Anonymous
Not applicable

Re: Credit Card Secrets

thanks for the information



edited to remove image. gawwad1, please do not insert these images.
Message Edited by haulingthescoreup on 06-01-2009 05:04 AM
Message 10 of 10
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