topic Avoiding Adverse Action? in Credit Cards

Avoiding Adverse Action?

Anonymous — Tue, 11 Sep 2018 05:33:36 GMT

Hey guys, maybe I’m just paranoid.

So I just was approved for a personal loan of 4K and then the discover it for 5.5k, less than a month apart.

I BT’d 2400 worth of balances to the discover from other credit cards, and I don’t plan on using them at all for at least 3-4 months (then small charges PIF)

I’ve made about 500 dollars of charges (nothing but bills and food) on the discover and don’t plan on using much more. I have no late payments, but my UTIL was pretty high at approval (69)

I just don’t want my credit limit decreased that would be disappointing.

Any advice? I really would like to make a big cash advance but I didn’t think about how the 4K loan will be showing up on the CR soon and with that as well as CC balance of 4K that’s 8 k of debt in a few months (keep in mind only 6k would be new debt)

I’m just worried Discover will get spooked because I have a thin file. AAOA: 2.6 years

How much of a cash advance can I take out, with all things above considered, without spooking them. Also how much should I pay per month to not scare them

Income is 50k annually

Re: Avoiding Adverse Action?

HeavenOhio — Tue, 11 Sep 2018 05:51:13 GMT

Don't do a cash advance. Everything else you're doing is fine.

Re: Avoiding Adverse Action?

Anonymous — Tue, 11 Sep 2018 06:23:18 GMT

Thanks for the quick response.
Also I was confused, oldest account is 2Y6M and AAOA is 1Y6M

Re: Avoiding Adverse Action?

AverageJoesCredit — Tue, 11 Sep 2018 11:25:12 GMT

As cool as Cash advance sounds, Credit card companies love to flaunt this number, which drives me nuts lol, its not a good idea to actually use as there is too many negative connotations that come with it. If you need that extra money msybe get another small loan.

Re: Avoiding Adverse Action?

Anonymous — Tue, 11 Sep 2018 11:45:40 GMT

Amazing responses so far!
The issue with cash advances is that it makes it card for the CC to know your spending habits. All they know is that you made a cash advance at some ATM that's it. I would rather the CC know my spending. But that's just me.

Re: Avoiding Adverse Action?

Anonymous — Tue, 11 Sep 2018 12:03:11 GMT

@Anonymous wrote:
Amazing responses so far!
The issue with cash advances is that it makes it card for the CC to know your spending habits. All they know is that you made a cash advance at some ATM that's it. I would rather the CC know my spending. But that's just me.

IMO, that's very low down in the "issue with cash advances". Much more significant, usually, is the fact that you immediately start paying interest (on many cards at a higher rate than purchases) and you often you lose the grace period on all purchases until you PIF including trailing interest.

Re: Avoiding Adverse Action?

xaximus — Tue, 11 Sep 2018 13:50:32 GMT

Cash advances on a CC are generally looked at as a bad idea. As others have stated - unless it is absolutely necessary - I wouldn't do it.

Re: Avoiding Adverse Action?

Anonymous — Tue, 11 Sep 2018 15:20:35 GMT

As everyone else has stated cash advances are not a good idea and I would never do it unless I was crawling on the floor desperate for money and could not get a personal loan--but then again I have an emergency fund so I would most likely never get to that point.

Side note: sometimes some (not all) lenders look at people who use cash advances as those who are in financial trouble so some people (not all) have been met with balance chasing, lowered CLs and other AA when taking a cash advance they did not pay off right away.

Good luck to you!

Re: Avoiding Adverse Action?

Anonymous — Tue, 11 Sep 2018 19:41:24 GMT

High utilization isn't an issue unless you're only paying the minimums every month, and it takes forver to pay it down.

It's okay to almost max out the card as long as it is paid down before the statement cuts, showing lowered utilization. Then make a couple large payments the next two statemnt periods. Or veen PIF when you can. CCC aren't going to get spooked about using your available credit, or they wouldn't have even given you a certain CL in the first place.

Just make sure you don't have the high balances when apping for new credit.

Re: Avoiding Adverse Action?

Anonymous — Tue, 11 Sep 2018 20:27:37 GMT

No red flags jump out to me. Discover isn’t really known as an issuer that’s quick to take AA (they may actually be one of the best to work with in that sense), so I don’t think you have anything to worry about thus far.

I would recommend against a cash advance for a number of reasons- mainly because it’s almost never a good idea due to feed an interest. Doing one so quickly may also be enough to spook Discover.

Re: Avoiding Adverse Action?

SouthJamaica — Tue, 11 Sep 2018 20:58:09 GMT

I never get cash advances except from credit union cards which do not have a cash advance fee.