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Senior Contributor
BearsAndTurtlesRtheBest
Posts: 3,675
Registered: ‎10-02-2012
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Re: REATIL STORES OR BANKS THAT MIGHT GO BYE BYE

@bs6054 I see okay thanks, at least now we know to not keep high balances because you never know when they might go BK thanks for the info.

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slg
Posts: 74
Registered: ‎03-19-2011
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Re: REATIL STORES OR BANKS THAT MIGHT GO BYE BYE

I'd say wells Fargo. They are not really into revamping their image to change with the times and their products are not very competitive 

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CreditWorld2013
Posts: 346
Registered: ‎02-01-2012
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Re: REATIL STORES OR BANKS THAT MIGHT GO BYE BYE

[ Edited ]

bs6054 wrote:

BearsAndTurtlesRtheBest wrote:

If they were to go out of business and are cardholders do they automatically close the account?? and if they do close them will it affect your credit??


If there are balances on the credit card accounts, these are receivable assets, and would pass to a buyer (or an appointed controller in the case of BK).  It would up to the new owners to decide whether to continue the cards, with or without new terms.


BS6054 is partially right about the outcome of the terms. The balances on the cards are almost always still owed to the original lender/issuer of the card: Capital One, Chase, etc. The only real time an issue about balances comes into place is if the store performed their own in-house financing/issuing their own credit cards (this would be handled through the BK court and so on). It gets a bit more complicated if the store is liquidating(Chapter 7) or re-structuring (Chapter 11). When Circuit City went down (Chase was the card issuer) people were told to continue paying Chase as they were the ones that maintained the accounts and was the lender. (If you had a balance on the account/s the lender can't change the terms that they were under so you would continue paying) If a store liquidates(like Circuit City) the bank can do a few options with the accounts. 1) Look for another company to do business with and bring the card accounts over (Chase partnered with Best Buy after Circuit City closed and allowed Circuit City customers to use their accounts at Best Buy) and this would keep a continuation into another store. 2) Close the accounts if you no longer have a need for it. 3) Offer you a different product (Chase offered Wamu customers Chase platinum cards, and so on) along with a few other options. 

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TiggerDat
Posts: 1,063
Registered: ‎10-15-2011
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Re: REATIL STORES OR BANKS THAT MIGHT GO BYE BYE

1.  Some times when the company closes another buys the accounts.  They then get the interest and probably purchase the debt at a discount, so this is a win-win situation for them.  Other times they purchase them and convert them into another store account as a way to get you to shop with that card at that store.  Usually when it is done it is a company like Comenity or GE.  Some times another company buys some of the locations and the card accounts as a way to expand and have new cardholders.  (Don't expect your old Wards card to work at the new Wards.  I was actually surprised to see someone reestablished the brand!)

 

2. I doubt Wells Fargo will go out of business.  They are pretty big and make a good profit off their CCs.  I do find it funny that a lot of the BIG BANKS are starting to charge more and more fees on checking accounts.  They bought up all those other banks to get economies of scale and then they raised fees.  Wasn't it supposed to happen the other way around?  Weren't they supposed to become cheaper?  Wells added a fee to my checking account and I went bye-bye!  I opened an account with a small bank online with no hassle.  Thanks to the internet it doesn't matter where you are, you can do what you want and these small businesses can gain advantages they did not have before.  Chase, BofA, Wells Fargo, all seem to want to be the biggest and cater to the best earners, but isn't that a bit too much?  Isn't that crowding out the market share?  I would think that one of them would simply become the everyday persons bank.  

 

3.  I think Best Buy is trying to transition to a more of an online store than disappear completely.  After all we can easily find many of their items online from competitors for the same price or cheaper.  I think they are realizing this and trying to balance things out to cut costs.  Having one warehouse in a cheaper rent district than 10 stores in a higher rent district makes more sense as we all are becoming more and more in touch with the internet for our purchases.

 

4.  I think we will start to see an increase in distribution centers and malls will become more of a social place with activities and small specialty shops.  I wouldn't be surprised if we also see more stand alone department stores as the anchors for the new malls.  Basically a situation where the higher end restaurants are clustered together around one department store and the same nearby for the mid and lower end.  Kind of like 4 squares with the 4th square being common services like banks, libaries, and what not.



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lithium78
Posts: 930
Registered: ‎07-30-2011
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Re: REATIL STORES OR BANKS THAT MIGHT GO BYE BYE

For store cards:  I wouldn't get a new retail card for Radio Shack, Best Buy, or Sears/KMart.  All three of those stores have been on the brink of bankruptcy for years now.  As for banks, most major banks are now relatively secure, since the majority of the financial crisis is over with.  There shouldn't be any major shake-ups like WaMu any time soon.  However, you should always check the health of smaller community banks, because those are sometimes still failing.


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TiggerDat
Posts: 1,063
Registered: ‎10-15-2011
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Re: REATIL STORES OR BANKS THAT MIGHT GO BYE BYE

[ Edited ]

lithium78 wrote:

For store cards:  I wouldn't get a new retail card for Radio Shack, Best Buy, or Sears/KMart.  All three of those stores have been on the brink of bankruptcy for years now.  As for banks, most major banks are now relatively secure, since the majority of the financial crisis is over with.  There shouldn't be any major shake-ups like WaMu any time soon.  However, you should always check the health of smaller community banks, because those are sometimes still failing.


I hope mine doesn't fail, I like them!  I don't get charged a fee for having the account!  I like PNC too for the same reason!  (I just wish they would preapprove me for a credit card so that I can have overdraft protection!  I haven't bounced a check in 10 years, but it would be nice just in case something bad happened.)

 

The only problem with having an account at a company that went out of business is that it would close at some point and affect your AAoA, but other than that it shouldn't be much of a big deal.  If Best Buy closed then I am sure that Capone would convert the cards into a MasterCard or Visa.  Sears would probably also be converted by GE and Radio Shack would probably also have the same conversion.  GE would still want you having and using credit, so they would have a plan.  In fact it might actually be a good thing to get a Sears/KMart card if you have problems getting a major card.  If Sears or KMart failed then you might by default end up with a GE MasterCard or Visa.  Maybe they would end the card program, but I think they would try and find a way to convert them to something else useful.  They might even give you an option on one of their other store cards at the very least!  (Is it GE who does Radio Shack?)  (OK, I guess it's Citi and I am sure they would have a plan too!)



Rethink every purchase you make, before you make it. Use the card with the best rewards. Pay in full each month. Redeem rewards often. Use the cards online shopping for more discounts. Smile, knowing that being thrifty allows you to actually get more out of the same amount of money!
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thom02099
Posts: 1,335
Registered: ‎08-30-2011
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Re: REATIL STORES OR BANKS THAT MIGHT GO BYE BYE

Regarding Wells Fargo, I agree that their credit card offerings leave a lot to be desired.  Pretty basic, plain vanilla stuff.  I have one simply because I have my mortgage with them as well.  And that is what will keep them afloat.  They are HUGE in the mortgage loan industry, buying out mortgages and/or offering mortgages direct.  When I did a refi on my house, I went from BofA to a small lender, but my broker told me the loan would likely get bought by Wells Fargo.  He was right. 

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js0319
Posts: 472
Registered: ‎02-27-2012
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Re: REATIL STORES OR BANKS THAT MIGHT GO BYE BYE

If you want to get a store card - Amazon is the way to go. All of these businesses that are failing are doing so because they cannot react fast enough and create a strategy against Amazon. All of the stores mentioned are "showrooms" for Amazon.


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thom02099
Posts: 1,335
Registered: ‎08-30-2011
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Re: REATIL STORES OR BANKS THAT MIGHT GO BYE BYE


js0319 wrote:

If you want to get a store card - Amazon is the way to go. All of these businesses that are failing are doing so because they cannot react fast enough and create a strategy against Amazon. All of the stores mentioned are "showrooms" for Amazon.


+1 Amen to that !

What WalMart did to Mom-and-Pop shops all over the country, Amazon is doing to the "big box" retailers that don't have a strong on-line presense...which is most of them.  Best Buy?  Fugitaboutit!  They are toast, it's just a matter of time.  Like you said, they are the showroom for Amazon.

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QAMngrGirl
Posts: 463
Registered: ‎11-28-2012
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Re: REATIL STORES OR BANKS THAT MIGHT GO BYE BYE

Kmart & Radioshack yanked out of South Florida for years now, never really interested me much anyways. Just got JCP so hopefully their online store stays around, I don't even know where the nearest one to me is! Comentity has a BUNCH of retail stores I have never heard of, wonder if they ever close any retail stores =/

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