Frequent Contributor
TheConductor
Posts: 492
Registered: ‎07-24-2012
Re: Barclays Did It Again...Another Payment Hold...
I just don't understand the sense of entitlement that has gripped (and choked the economy within) our American society. Since when are we entitled to have our available credit reinstated on OUR timetable? The lender is the one taking the risk here, not the borrower. We would all do well to remember that when we whine about the terms and conditions WE AGREED TO when we were afforded the PRIVILEGE of unsecured credit.


This. This. A hundred times this.

 

@Andy77, I read your prior thread and bit my tongue to avoid saying exactly this.

 

The lender is taking the risk here, extending you credit on nothing more than a promise to pay. And with terms you signed on the dotted (or digital) line to agree to.

 

You ask for them to have a logical reason to hold your payment, but to be perfectly frank you have given them that logical reason.

 

I wrote a scoring algorithm for a major mortgage collection company, and I have been privy to a couple of non-FICO scoring algorithms for the revolving-credit world as well, so while non-disclosure binds me from going into detail on how those algorithms intepret risk (and while you can see that said knowledge has not prevented me from making my own ill-advised mistake recently), I can tell you this much:

 

Your behavior in getting a credit-line increase, immediately charging up to $25 shy of it, and then proceeding to oscillate between your CLI and CLI minus 900 every week, is a giant red flag for risk.

 

What every scoring model is attempting to identify is patterns.  Patterns that correlate strongly with risk.  The pattern of your spending and usage on this card is going to get you sorted into one of two likely buckets:

 

1. CASHFLOW CONSTRAINED - Someone who does not have sufficient money to handle all of their debts and obligations. You see this a lot when someone has been laid off, for example. Bumping against the CLI ceiling, and spending back up to it as soon as any payment is made.

 

2. FRAUD PREP - A common credit fraud tactic is to use a card responsibly for a while to get it up to a decent credit limit, then make a  "hot" payment that bounces and run away with the proceeds. To their model, you may look like someone who is shoving their limit up just so they can get a bigger haul when they're ready to ditch the account and cash in.

 

From the lender's point of view, however annoying it may be to you, it's sensible and logical to hold your money until the payment has FULLY cleared.  Typically, that's 2 to 4 business days although it can sometimes be longer. It would not surprise me if the first hold lifts today, and that won't be because you threatened them with bad publicity but simply because the money is finally officially in their hands.

 

If you want to understand a lender, think like a lender.

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