What exactly is Adverse action?

[killer_queen229]

I've read that Barclay and Amex definitely does it. Since I have a lot of inquiries/accounts open, will Amex just monitor how I'm doing? Like I said in another thread my spending limits won't change and I'm not applying for anymore cards for a year or more.

[Creditaddict]

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@killer_queen229 wrote:

I've read that Barclay and Amex definitely does it. Since I have a lot of inquiries/accounts open, will Amex just monitor how I'm doing? Like I said in another thread my spending limits won't change and I'm not applying for anymore cards for a year or more.

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Adverse action is credit line decreasing you or closing your account or in Amex' case possibly freezing your account and asking you to sign a tax release to verify your income which isn't really adverse action unless they don't like what they find and reduce your credit line or close the account which seems kind of rare to have it closed.

I wouldn't worry about any of it... you will just be wasting your energy thinking about what you might do to trigger.

[longtimelurker]

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@killer_queen229 wrote:

I've read that Barclay and Amex definitely does it. Since I have a lot of inquiries/accounts open, will Amex just monitor how I'm doing? Like I said in another thread my spending limits won't change and I'm not applying for anymore cards for a year or more.

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There is a range.   At the simplest, the issuer just closes your card (and potentially your other cards with that issuer).  All credit card agreements basically allow either side to close without notice.

They can also CLD (Credit Limit Decrease), deciding that they no longer want you to have say a $3K limit and replace is with a $500 one.   If you are carrying a balance on the card, this will have a bad impact on your score.    In really bad cases they will keep decreasing the limit to your current balance (balance chasing) until it becomes 0 and the card gets closed.

Amex also does Financial Reviews in rare cases, and that can lead to no change, CLDs or card closures.

But most people never experience these things.

[killer_queen229]

You're right, I shouldn't worry.. the only "bad" things or not so great things I do is worry (lol), having too many inquiries in a short period of time and too many new accounts open. I've always treated my accounts well and I don't think I've ever been looked at negativily by any company as far as I know.

[killer_queen229]

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@longtimelurker wrote:

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@killer_queen229 wrote:

I've read that Barclay and Amex definitely does it. Since I have a lot of inquiries/accounts open, will Amex just monitor how I'm doing? Like I said in another thread my spending limits won't change and I'm not applying for anymore cards for a year or more.

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There is a range.   At the simplest, the issuer just closes your card (and potentially your other cards with that issuer).  All credit card agreements basically allow either side to close without notice.

They can also CLD (Credit Limit Decrease), deciding that they no longer want you to have say a $3K limit and replace is with a $500 one.   If you are carrying a balance on the card, this will have a bad impact on your score.    In really bad cases they will keep decreasing the limit to your current balance (balance chasing) until it becomes 0 and the card gets closed.

Amex also does Financial Reviews in rare cases, and that can lead to no change, CLDs or card closures.

But most people never experience these things.

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I guess I am scaring myself for no reason when I know if I do what I am suppose to do then there is nothing to worry about. If I do everything as I've always done that has kept my older accounts in good standing, then Amex will probably leave me alone. And I don't like to carry balances on any card and if I do, it's not often.

[Open123]

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@killer_queen229 wrote:

I guess I am scaring myself for no reason when I know if I do what I am suppose to do then there is nothing to worry about. If I do everything as I've always done that has kept my older accounts in good standing, then Amex will probably leave me alone. And I don't like to carry balances on any card and if I do, it's not often.

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In general, just practice some common sense and use the cards as intended, which should help you avoid 99.9% of AAs.  In my view, don't worry about things you can't control.

[grinlikechelsea]

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@Open123 wrote:

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@killer_queen229 wrote:

I guess I am scaring myself for no reason when I know if I do what I am suppose to do then there is nothing to worry about. If I do everything as I've always done that has kept my older accounts in good standing, then Amex will probably leave me alone. And I don't like to carry balances on any card and if I do, it's not often.

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In general, just practice some common sense and use the cards as intended, which should help you avoid 99.9% of AAs.  In my view, don't worry about things you can't control.

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Excellent advice here. As long as you were honest on your application and aren't breaking the cardmember agreement, you really shouldn't have anything to worry about.

[killer_queen229]

Sounds good

[enharu]

Since you racked up a number of inquiries and new accounts, its best to avoid having extremely high balances report on multiple cards in the same month. And make payments in full preferably. Last but not least, avoid applying for anymore credit in the near future obviously.

That will for the most part avoid most causes of FR and AA.

[FinStar]

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@enharu wrote:
Since you racked up a number of inquiries and new accounts, its best to avoid having extremely high balances report on multiple cards in the same month. And make payments in full preferably. Last but not least, avoid applying for anymore credit in the near future obviously.

That will for the most part avoid most causes of FR and AA.

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+1

Good advice here.