topic Re: Amex CLD in Credit Cards

Amex CLD

Hokies2379 — Wed, 28 Dec 2016 14:51:15 GMT

Just out of the blue, they cut my Delta from $7,000 to $4000. Bad part is, I just let a statement report at 3k (christmas) that I was going to pay off in January.

My only thought could be that I recently, essentially, maxed my boa due to 18 mos at 0%. Kinda though that's what those things were for. Live and learn.

No other balances have changed drastically, and I've only had one inquiry since September. Had to be boa.

Re: Amex CLD

Anonymous — Wed, 28 Dec 2016 15:01:37 GMT

I think it was a combination of the two. While your other card was maxed out, your Amex was at $3000/$7000 which is 43% utilization. While Amex certainly can look at your other accounts when they SP you, of course the account they care about most is their own. If they saw you max out another account and at the same time see that you're balance with them is at a high point, they are dropping your limit to prevent you from maxing out $7k with them.

What type of spend/balance did you typically show Amex monthly prior to this?

Obviously this situation isn't favorable, but once you pay down your utilization your scores will go back up and your profile will instantly strengthen which should allow you to get your Amex limit back to where it was.

A few other questions, what was the credit limit on the card you maxed out and aside from that card and Amex, do you have any other cards? If so, what are their credit limits and balances?

Re: Amex CLD

yfan — Wed, 28 Dec 2016 15:44:31 GMT

This sounds like balance chasing. Amex is generous with high limits, but they are also extra cautious.

Re: Amex CLD

noobody — Wed, 28 Dec 2016 15:46:35 GMT

No big deal, when your file get better, you will get those CL back in no time

Re: Amex CLD

Hokies2379 — Wed, 28 Dec 2016 15:56:31 GMT

My file is fine. I have about 20k balances and 150k available credit.

I spoke to Amex, it was a "bi annual" review and yep, it was all about the boa card. 4500/5000 I explained that it was 0% for a year and a half and they told me to pay 1k by 2/26 and they'd reinstate my limit to it's original amount. Heck, I was going to pay it off long before that anyway.....seems like a whole lot of something over nothing...

Re: Amex CLD

Hokies2379 — Wed, 28 Dec 2016 15:57:09 GMT

@yfan wrote:
This sounds like balance chasing. Amex is generous with high limits, but they are also extra cautious.

Not familiar with this term, please explain.

Re: Amex CLD

Hokies2379 — Wed, 28 Dec 2016 15:58:35 GMT

@Anonymous wrote:
I think it was a combination of the two. While your other card was maxed out, your Amex was at $3000/$7000 which is 43% utilization. While Amex certainly can look at your other accounts when they SP you, of course the account they care about most is their own. If they saw you max out another account and at the same time see that you're balance with them is at a high point, they are dropping your limit to prevent you from maxing out $7k with them.

What type of spend/balance did you typically show Amex monthly prior to this?

I typically run 2-3k through my amex monthly. I've had it as high as 6500 and paid down to 0 in the same cycle.

Re: Amex CLD

Anonymous — Wed, 28 Dec 2016 16:13:14 GMT

@Hokies2379 wrote:
@yfan wrote:
This sounds like balance chasing. Amex is generous with high limits, but they are also extra cautious.
Not familiar with this term, please explain.

Balance Chasing is when an issuer continously lowers your CL to just above your existing balance (so your card is always nearly maxed out). As you pay it down, the CL gets reducued.

Re: Amex CLD

fltireguy — Wed, 28 Dec 2016 16:14:27 GMT

Balance chasing is when you get a CLD to what your current balance is..

For example, you had a $10K CL, with a $6K bal. They lower your CL to $6K

Then the next month, you pay down, lets say $1500 . And they CLD you

to your new balance, which would be $4500..etc..

Re: Amex CLD

Hokies2379 — Wed, 28 Dec 2016 16:15:08 GMT

@Anonymous wrote:
@Hokies2379 wrote:
@yfan wrote:
This sounds like balance chasing. Amex is generous with high limits, but they are also extra cautious.
Not familiar with this term, please explain.
Balance Chasing is when an issuer continously lowers your CL to just above your existing balance (so your card is always nearly maxed out). As you pay it down, the CL gets reducued.

that would piss me off to no end. however, since they told me if I paid 1k by 2/26, I'd HOPE this isn't it? or is that just the carrot?

Re: Amex CLD

Anonymous — Wed, 28 Dec 2016 16:19:04 GMT

@Hokies2379 wrote:
@Anonymous wrote:
@Hokies2379 wrote:
@yfan wrote:
This sounds like balance chasing. Amex is generous with high limits, but they are also extra cautious.
Not familiar with this term, please explain.
Balance Chasing is when an issuer continously lowers your CL to just above your existing balance (so your card is always nearly maxed out). As you pay it down, the CL gets reducued.
that would piss me off to no end. however, since they told me if I paid 1k by 2/26, I'd HOPE this isn't it? or is that just the carrot?

Yes, I think you are fine. Balance chasing is used to end a relationship, it seems here that Amex just had some concerns which go away if you pay as they asked

Re: Amex CLD

NRB525 — Wed, 28 Dec 2016 19:39:47 GMT

@Anonymous wrote:
@Hokies2379 wrote:
@Anonymous wrote:
@Hokies2379 wrote:
@yfan wrote:
This sounds like balance chasing. Amex is generous with high limits, but they are also extra cautious.
Not familiar with this term, please explain.
Balance Chasing is when an issuer continously lowers your CL to just above your existing balance (so your card is always nearly maxed out). As you pay it down, the CL gets reducued.
that would piss me off to no end. however, since they told me if I paid 1k by 2/26, I'd HOPE this isn't it? or is that just the carrot?
Yes, I think you are fine. Balance chasing is used to end a relationship, it seems here that Amex just had some concerns which go away if you pay as they asked

This is only a CLD. For it to be Balance Chasing, there would need to be two or more CLD. And Balance Chasing does not have to mean the end of the banking relationship. I have two cards from BofA which were consistently Balance chased, but are just fine now at $8.8k and $14.8k. Another from Chase that was Balance chased, and I eventually decided to close anyway. It often depends on how the cardholder reacts. If the bank wants to close the account, they will do so outright. I've had accounts closed with balances. In most ( all ) of the cases posted here, the cardholder panics and closes the account, when they most likely could have ridden it out, pay down the balance, and rebuild the trust from the bank. You end up with a stronger file at the bank after working through a CLD without quitting.

With AMEX, the CLI come easy, but so do the CLD as part of their risk management. As others have noted, as you pay off the cards, the AMEX CLI should be available before too long.

Re: Amex CLD

Anonymous — Wed, 28 Dec 2016 20:04:41 GMT

@Hokies2379 wrote:
My file is fine. I have about 20k balances and 150k available credit.

Just so you are aware, any two-digit aggregate utilization isn't considered to be ideal. While it may not be "bad" or anything, it isn't ideal like single-digit utilization is.

Also it wouldn't surprise me if creditors did take into account dollars rather than just percentage. $20k in balances on $150k in available credit is the same percentage as $2k in balances on $15k in available credit, but clearly the person with $20k in debt is more exposed than the other person. While it may seem that the income of the first person may be higher (to justify the $20k in debt) it's quite doubtful that this person possesses an income 10X that of the other person, while their debt is 10X greater.

Your $4500 balance on a $5000 card certainly isn't a great look, but if that was $18k on a $20k card IMO it's a worse look even though percentage wise it's the same thing simply based on the amount of exposure and greater potential risk.

Re: Amex CLD

Hokies2379 — Wed, 28 Dec 2016 20:13:16 GMT

@Anonymous wrote:
@Hokies2379 wrote:
My file is fine. I have about 20k balances and 150k available credit.

Just so you are aware, any two-digit aggregate utilization isn't considered to be ideal. While it may not be "bad" or anything, it isn't ideal like single-digit utilization is.

Also it wouldn't surprise me if creditors did take into account dollars rather than just percentage. $20k in balances on $150k in available credit is the same percentage as $2k in balances on $15k in available credit, but clearly the person with $20k in debt is more exposed than the other person. While it may seem that the income of the first person may be higher (to justify the $20k in debt) it's quite doubtful that this person possesses an income 10X that of the other person, while their debt is 10X greater.

Your $4500 balance on a $5000 card certainly isn't a great look, but if that was $18k on a $20k card IMO it's a worse look even though percentage wise it's the same thing simply based on the amount of exposure and greater potential risk.

word.

Re: Amex CLD

Credit_hawk — Wed, 28 Dec 2016 22:31:23 GMT

@Hokies2379 wrote:
@Anonymous wrote:
@Hokies2379 wrote:
My file is fine. I have about 20k balances and 150k available credit.

Just so you are aware, any two-digit aggregate utilization isn't considered to be ideal. While it may not be "bad" or anything, it isn't ideal like single-digit utilization is.

Also it wouldn't surprise me if creditors did take into account dollars rather than just percentage. $20k in balances on $150k in available credit is the same percentage as $2k in balances on $15k in available credit, but clearly the person with $20k in debt is more exposed than the other person. While it may seem that the income of the first person may be higher (to justify the $20k in debt) it's quite doubtful that this person possesses an income 10X that of the other person, while their debt is 10X greater.

Your $4500 balance on a $5000 card certainly isn't a great look, but if that was $18k on a $20k card IMO it's a worse look even though percentage wise it's the same thing simply based on the amount of exposure and greater potential risk.
word.

Trust

Re: Amex CLD

Hokies2379 — Fri, 13 Jan 2017 16:22:49 GMT

Quick update, they restored my credit limit, plus an additional 3k this morning.

Re: Amex CLD

Thomas_Thumb — Fri, 13 Jan 2017 18:33:46 GMT

@Hokies2379 wrote:
My file is fine. I have about 20k balances and 150k available credit.

I spoke to Amex, it was a "bi annual" review and yep, it was all about the boa card. 4500/5000 I explained that it was 0% for a year and a half and they told me to pay 1k by 2/26 and they'd reinstate my limit to it's original amount. Heck, I was going to pay it off long before that anyway.....seems like a whole lot of something over nothing...

FWIW - Anytime a card's utilization is "maxed out" it raises a flag for a potential CLD. Experian defines max out as 90% utilization - which just so happens to be where you are at $4500/$5000. Even for 0% interest cards, it's probably best to stay below 70% utilization to avoid any significant risk of adverse action (AA).

The majority of articles I have seen on utilization use 30% as an upper threshold for "responsible" credit management. This threshold is rather important for aggregate (total) utilization (all revolving accounts combined) - but not a major threshold on an individual card basis