TOO many recent accounts

[fedxboy]

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@icyhot wrote:

I've been trying to get CLIs on both of my Citi cards and for the life of me haven't been able to. The reason has always been too many recent accounts. I didn't even realize how many recent acocunt I had until I checked CK and looked.

Last 6 Months:

BofA AAA card: 4/7/2015 (closed)

American Airlines card: 4/19/2015 (closed, still reporting open)

Delta Amex: 4/19/2015 still open, plan to close and roll into Hilton

Fidelity Amex: 4/27/2015 (closed)

CSP: 4/28/2015

Venture: 6/7/2015

Cap1 Spark: 6/7/2015 (plan to roll into other Spark)

Hilton Amex: 6/15/2015

BP store card (closed this less than 48 hours after I opened it, disputed it after it reported, CK said it was removed, its still there???)

Cap 1 Spark select: 9/7/2015

From 12/27/2014 to 3/26/2015 I opened 11 cards, only 3 of which are still open. So thats 21 cars in a year span, and I only have 9 cards to show for it ( my other 3, Forward, Macy's and Kohls were opened outside the year span).

Littered file as it may be, I use these Citi cards heavily. When would be a good time to ask for an increase? Besides Amex, they're the only ones who won't budge. 

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@Anonymous OP, I've opened just as many cards as you within the last year and that's the same reason I get when I try to get a CLI on my DC. My DC was formerly a Diamond opened in 2012 and it hasn't gotten any LOVE/cli for the last year -- stuck @ 4.6k.   Furthermore, when I go to the Citi site for pre-approvals, they don't have any thing for me.   Just letting you know, you're not alone!  Although, I haven't closed any

[Anonymous]

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@icyhot wrote:
As far as whether I *need* a higher CL, not at this moment, will be nice to see in the future. Most of the less recent accounts were a result of me getting a bunch of store cards since those were the only cards I could get approved for at the time. I had 3 major cards all sitting at 99% UTL, wanted more spending power because the concepts of PIF and only spending what I could pay back never entered my mind. Once I paid my cards down to zero, I wanted to get more cards, and to my misunderstanding thought that closing cards meant your AAOA would go up. So I went on a card closing spree. Then even after I learned better, I couldn't help but open cards on impulse and then close as soon as I realized they were of no use. Young and silly

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Hopefully, you decide to garden for the next 12 months. While you're gardening, I would spend some time reading the threads on these forums. There is a lot of helpful information on here. Even if you don't get it here, do some research online because a lot of these myths or assumptions have been addressed.

[Blodreina]

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@Open123 wrote:

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@Simba501 wrote:

I'm not convinced that lenders are specifically looking for MS or churning behavior, as there isn't a real way to discern that from one's credit reports.  I would argue that they're more so looking to identify people who are habitual credit seekers, which could be an equally plausible explanation for Chase's rule, for example.  The initial credit application seems like its purpose is to gauge risk of default; policies in place after acquiring the card, I'm guessing, would attempt to address the MS, bonus stuff.

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I do think Chase is trying to limit "churning," at least, to some extent.  Everytime I transfer UR points, I'm greeted with, paraphrasing here, "if you were to sell the points, bought them, transfer to other than your spouse or co-owner on business card, or otherwise open or close card for the points, Chase can and will close not only close all of your accounts, but also confiscate all UR points"

Now, I'm not sure how they'd be able to discern this with enough accuracy to keep from undermining a lump-sum bonus's intended purpose of driving client acquisition.

*Edited* PS - Amex has adopted a similar approach, but rather than policing it, they just limited to one per lifetime.  Interestingly enough, business cards have been excluded from this limitation.

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Of this, I have no doubt.  It is the primary reason why there are parameters around other rewards outside of signing bonuses as well; the lender has to make it enticing enough to encourage use but put some limits on it to reduce loss of profit, I suppose (e.g., quarterly caps on 5% gas cashback for the Sallie Mae).

I'm sorry; I should have been a bit clearer.  I meant that I do not think lenders are attempting to identify this behavior (or propensity for it) on the initial credit application (with credit reports).  Frequently opened and closed accounts are poor evidence, at best, for churning or MS behavior.  What you're referring to are policies that are enforced after one has obtained the card (e.g., warning messages like you mentioned, one bonus per lifetime, etc.).

[Open123]

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@Simba501 wrote:

I'm sorry; I should have been a bit clearer.  I meant that I do not think lenders are attempting to identify this behavior (or propensity for it) on the initial credit application (with credit reports).  Frequently opened and closed accounts are poor evidence, at best, for churning or MS behavior.  What you're referring to are policies that are enforced after one has obtained the card (e.g., warning messages like you mentioned, one bonus per lifetime, etc.).

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Agreed.

This behavior in of itself is poor indication of risk.  Unless an Underwriter is privy to the "type" of Amex/Chase/Citi cards open or closed, the fact that TLs from these lenders were opened and closed in a less than "X" amount of time has little to no bearing on default risk or the motivations behind the opening/closing of a respective TL.  A person could have been bonus chasing.  Or, he could have changed his mind.  Or, the lender upset him.  Or, he could simply be a "flavor of the month" type of person.  Or, he may simply find the color of the card unbearable, such as the Fid Amex.

Other factors of the CRs, such as aggregate CL, AAOA, payment history, amount charge and paid, recent derogs, utilization, income, address, age, and profession would be far better indicators of default risk than the number of accounts "opened or closed."

[icyhot]

Address?? Profession?? How so??

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@Open123 wrote:

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@Simba501 wrote:

I'm sorry; I should have been a bit clearer.  I meant that I do not think lenders are attempting to identify this behavior (or propensity for it) on the initial credit application (with credit reports).  Frequently opened and closed accounts are poor evidence, at best, for churning or MS behavior.  What you're referring to are policies that are enforced after one has obtained the card (e.g., warning messages like you mentioned, one bonus per lifetime, etc.).

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Agreed.

This behavior in of itself is poor indication of risk.  Unless an Underwriter is privy to the "type" of Amex/Chase/Citi cards open or closed, the fact that TLs from these lenders were opened and closed in a less than "X" amount of time has little to no bearing on default risk or the motivations behind the opening/closing of a respective TL.  A person could have been bonus chasing.  Or, he could have changed his mind.  Or, the lender upset him.  Or, he could simply be a "flavor of the month" type of person.  Or, he may simply find the color of the card unbearable, such as the Fid Amex.

Other factors of the CRs, such as aggregate CL, AAOA, payment history, amount charge and paid, recent derogs, utilization, income, address, age, and profession would be far better indicators of default risk than the number of accounts "opened or closed."

[Anonymous]

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@icyhot wrote:
Address?? Profession?? How so??

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 My guess would be: from your address they can determine if you live in a wealthy or poorer area; generally people who live in a nicer area would have a higher chance of paying back debt (e.g., they could take out a line of credit against their house)...for occupation a steadier job in a high-paying field (I think techincal/engineering jobs would qualify) indicates not just high income but also slightly more job security, therefore lower risk.

Again, these are just my (somewhat educated) guesses, so take them at face value!

[kdm31091]

At the end of the day, none of us are underwriters. We cannot tell you that opening and closing like that is or isnt a risk factor, definitively.

I think the concensus is you need to garden and throw unused cards in the drawer for now instead of closing them. We can speculate all day about whether closing them would be harmful or not, but whats the point? Do what you feel is best but the obvious thing is to stop apping. If it means a break from the forums so be it. Good luck

[Open123]

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@Anonymous wrote:

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@icyhot wrote:
Address?? Profession?? How so??

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 My guess would be: from your address they can determine if you live in a wealthy or poorer area; generally people who live in a nicer area would have a higher chance of paying back debt (e.g., they could take out a line of credit against their house)...for occupation a steadier job in a high-paying field (I think techincal/engineering jobs would qualify) indicates not just high income but also slightly more job security, therefore lower risk.

Again, these are just my (somewhat educated) guesses, so take them at face value!

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+1

Right, while no one knows for certain, in this modern era of big data, it would be prudent to assume these algorithms will take virtually every datapoing about our lives into consideration, even our friends on Facebook, etc...

[longtimelurker]

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@Simba501 wrote:

I'm sorry; I should have been a bit clearer.  I meant that I do not think lenders are attempting to identify this behavior (or propensity for it) on the initial credit application (with credit reports).  Frequently opened and closed accounts are poor evidence, at best, for churning or MS behavior.  What you're referring to are policies that are enforced after one has obtained the card (e.g., warning messages like you mentioned, one bonus per lifetime, etc.).

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Right.   Also MS and churning can look very different.   Churners really have to open several cards (by definition), as an MSer I am happy with one card as long as they let me.   As you suggest, MS detection is done by the issuer looking at usage after the card has been approved.

[Anonymous]

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@OmarGB9 wrote:
^There's anecdotal evidence of people calling in to recon after denials and getting grilled by analysts about too many new accounts/closed accounts in a short period of time (less than a year or 2).

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That was, in fact, one of the questions the underwriter asked me when I reconned my Chase Freedom. I had just closed three accounts, and two of them weren't even new.