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Valued Contributor
Posts: 9,055
Registered: ‎10-21-2012
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Re: Does "balance chasing" still happen


maiden_girl wrote:

How often does that happen? The way I look at it, the bank gave you the CL for a reason...to use it. Obviously to pay it back but to make use of it.


It is unsecured, borrowed money, plain and simple.  Unless someone's credit or financial picture drastically changes or appears to be an adverse risk to the lender, they are within their rights to CLD, close or demand full payment on that CC.  It is an established T&C contract between both parties when applying.  Obviously, if one is dilligent, pays as agreed and is within the T&C without any issues, then there really shouldn't be much of a concern.

Established Contributor
Posts: 581
Registered: ‎01-31-2008
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Re: Does "balance chasing" still happen

Thanks for the info. Out of curiosity, what is the CC conpany calculating your DTI from since that's not the same as util?
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Frequent Contributor
Posts: 390
Registered: ‎03-24-2013
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Re: Does "balance chasing" still happen

DTI is all monthly debt payments. CCs, student loans, mortgages, etc.

 

Unsurprisingly, wikipedia actually explains it quite well. http://en.wikipedia.org/wiki/Debt-to-income_ratio



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In the garden as of 10/12/2013
Established Contributor
Posts: 581
Registered: ‎01-31-2008
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Re: Does "balance chasing" still happen

So would they use overall CC and loan debt or your monthly payments?
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Frequent Contributor
Posts: 390
Registered: ‎03-24-2013
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Re: Does "balance chasing" still happen

Loans are your monthly payments. You DTI would be ridiculus if it was your total loan amount of something like a mortgage. I believe CC debt is calculated by minimum monthly payment.



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In the garden as of 10/12/2013
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Senior Contributor
Posts: 6,279
Registered: ‎08-16-2012
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Re: Does "balance chasing" still happen

What if student loans are in deferment? Do those count against your dti?
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