topic Re: Credit Line Catch-22 in Credit Cards

Credit Line Catch-22

Anonymous — Sun, 04 Apr 2021 04:56:34 GMT

I couldn't find a thread specifically dealing with this issue, so I figured I'd start my own.

A bit of background - I suppose I would be considered an "unconventional" poster: freelance writer sexagenarian, own home free-and-clear for past five years, own fairly new car free-and-clear, paid off $44,000 of Parent Plus loans for the kiddos, and now plugging away at rather hefty credit card balances, having landed a steady gig after an awful two years of very limited income. Paid off Discover and Avant in full, and now working on Chase cards (3) and BoA.

Here's the issue - I got into a spat with Lowe's over a botched delivery and delayed paying that puny balance of $100 two-weeks past the due date. Synchrony Bank, those charmers, reported the late payment. I closed the account - the credit line was minimal and I ain't shopping at Lowe's no more, so no big deal EXCEPT how that impacted my Chase Freedom account.

Originally, the Chase Freedom line was $10K. Last year, I took advantage of their COVID skip-a-payment offer, after which they dropped the line to $8,500. If I'd known they were going to do that, I'd not have skipped. I find out this month that they dropped my limit again, to $7,300 citing a late payment on my credit report (thanks Synchrony). This fries me for two reasons: I have not missed a payment on ANY cards (I'm talking 30 days or more) in the past 7 years. My repayment record is 100%. Plus, by lowering my line, they increase my percentage of credit used in spite of me making monster payments to get rid of the debt, making it dang hard to up my FICO of 630. This matters because once the cards are paid off, I'll be applying for a HELOC as way to access home equity in the event of an emergency, and I don't want to be denied because of a low score.

So how best to handle this with the folks at Chase? I'm paying off one of the other Chase cards this month, and I know the Disover and Avant payoffs haven't been reported yet. Should I just wait until they show? Fire off an indignant letter to JPMorgan and company? I'm pretty steamed about this and am taking time to cool off, but if I start seeing a domino effect with my other cards they'll be some fiery tirades coming their way.

Any and all advice is welcome.

Re: Credit Line Catch-22

Anonymous — Sun, 04 Apr 2021 05:09:15 GMT

I would actually take the issue up with Synchrony. If you were only two weeks late, they cannot report you as 30 days late which is the minimum time period that must lapse before a customer can be reported as such.

If you were actually 30 days late, there's not any recourse that you have. You can try to get a goodwill adjustment from Synchrony but the domino effect is an unfortunate and very real consequence of being late on a payment.

Re: Credit Line Catch-22

dragontears — Sun, 04 Apr 2021 05:16:07 GMT

@Anonymous wrote:
I couldn't find a thread specifically dealing with this issue, so I figured I'd start my own.

A bit of background - I suppose I would be considered an "unconventional" poster: freelance writer sexagenarian, own home free-and-clear for past five years, own fairly new car free-and-clear, paid off $44,000 of Parent Plus loans for the kiddos, and now plugging away at rather hefty credit card balances, having landed a steady gig after an awful two years of very limited income. Paid off Discover and Avant in full, and now working on Chase cards (3) and BoA.

Here's the issue - I got into a spat with Lowe's over a botched delivery and delayed paying that puny balance of $100 two-weeks past the due date. Synchrony Bank, those charmers, reported the late payment. I closed the account - the credit line was minimal and I ain't shopping at Lowe's no more, so no big deal EXCEPT how that impacted my Chase Freedom account.

Originally, the Chase Freedom line was $10K. Last year, I took advantage of their COVID skip-a-payment offer, after which they dropped the line to $8,500. If I'd known they were going to do that, I'd not have skipped. I find out this month that they dropped my limit again, to $7,300 citing a late payment on my credit report (thanks Synchrony). This fries me for two reasons: I have not missed a payment on ANY cards (I'm talking 30 days or more) in the past 7 years. My repayment record is 100%. Plus, by lowering my line, they increase my percentage of credit used in spite of me making monster payments to get rid of the debt, making it dang hard to up my FICO of 630. This matters because once the cards are paid off, I'll be applying for a HELOC as way to access home equity in the event of an emergency, and I don't want to be denied because of a low score.

So how best to handle this with the folks at Chase? I'm paying off one of the other Chase cards this month, and I know the Disover and Avant payoffs haven't been reported yet. Should I just wait until they show? Fire off an indignant letter to JPMorgan and company? I'm pretty steamed about this and am taking time to cool off, but if I start seeing a domino effect with my other cards they'll be some fiery tirades coming their way.

Any and all advice is welcome.

First thing you need to do is calm down.

Chase is balance chasing you because your profile is showing high risk with prolonged high utilization, a recent late and with you taking advantage of covid relief options they are worried that you will not pay them. They are lower your CL to prevent you from increasing the balance again. This is a business/risk assessment, it is not personal.

Sending them threatening or indignant letters will not help you and could lead them to terminating their relationship with you by closing your card completely. And yes, they can close the card while it still has a balance that you are required to pay.

The only thing you can do is pay down your cards as fast as your financial situation will allow and wait for the chasing to stop. If your other lenders start balance chasing you, it is not because of chase, it is because of the same reasons, prolonged high utilization and a recent late payment.

It is painful and annoying to go through balance chasing but eventually it will stop.

Also lower limits themselves will not give you low scores, FICO scoring is generally about percentages not $$ amounts. My little brother has scores in the low 800s and his highest credit card limit is $1,000.

Re: Credit Line Catch-22

FinStar — Sun, 04 Apr 2021 05:25:36 GMT

Hello @Anonymous and welcome to the forums.

So, just so I'm on the same page in digesting the above, you deliberately delayed the Lowe's payment due to this botched delivery? Did you address this directly with Lowe's at the time? Did you also discuss this with SYNCB as far as the issue?

Unfortunately, given that Chase already has an internal record of the skip-a-payment (COVID relief) and with the recent late payment, it appears it's created a balance chasing condition (automatic). Since I'm assuming the balance is a fair amount given the step-down reduction on your revolving limit, they're simply mitigating risk since they've picked up on some distress flags. Firing up a letter may not yield much as far as restoring your limit, though.

What is your aggregate utilization or balances across all your accounts? You mention 3 Chase cards and BoA.

Re: Credit Line Catch-22

Anonymous — Sun, 04 Apr 2021 05:24:02 GMT

I already have a dispute filed with Experian & Transunion about this, thanks.

More miffed at Chase and a bit puzzled why this affected only that account. I have three cards with them.

Re: Credit Line Catch-22

Remedios — Sun, 04 Apr 2021 05:29:33 GMT

@Anonymous wrote:
I couldn't find a thread specifically dealing with this issue, so I figured I'd start my own.

A bit of background - I suppose I would be considered an "unconventional" poster: freelance writer sexagenarian, own home free-and-clear for past five years, own fairly new car free-and-clear, paid off $44,000 of Parent Plus loans for the kiddos, and now plugging away at rather hefty credit card balances, having landed a steady gig after an awful two years of very limited income. Paid off Discover and Avant in full, and now working on Chase cards (3) and BoA.

Here's the issue - I got into a spat with Lowe's over a botched delivery and delayed paying that puny balance of $100 two-weeks past the due date. Synchrony Bank, those charmers, reported the late payment. I closed the account - the credit line was minimal and I ain't shopping at Lowe's no more, so no big deal EXCEPT how that impacted my Chase Freedom account.

Originally, the Chase Freedom line was $10K. Last year, I took advantage of their COVID skip-a-payment offer, after which they dropped the line to $8,500. If I'd known they were going to do that, I'd not have skipped. I find out this month that they dropped my limit again, to $7,300 citing a late payment on my credit report (thanks Synchrony). This fries me for two reasons: I have not missed a payment on ANY cards (I'm talking 30 days or more) in the past 7 years. My repayment record is 100%. Plus, by lowering my line, they increase my percentage of credit used in spite of me making monster payments to get rid of the debt, making it dang hard to up my FICO of 630. This matters because once the cards are paid off, I'll be applying for a HELOC as way to access home equity in the event of an emergency, and I don't want to be denied because of a low score.

So how best to handle this with the folks at Chase? I'm paying off one of the other Chase cards this month, and I know the Disover and Avant payoffs haven't been reported yet. Should I just wait until they show? Fire off an indignant letter to JPMorgan and company? I'm pretty steamed about this and am taking time to cool off, but if I start seeing a domino effect with my other cards they'll be some fiery tirades coming their way.

Any and all advice is welcome.

Hello and welcome

30 day late is a pretty big deal, especially when it's fresh.

If you have issues with merchant, those aren't resolved by refusing to pay what you referred to as "puny $100"

Any missed payment has consequences..

As far as Chase doing a CLD, after you enrolled in payment relief program, those were designed for people who needed it, not because anyone thought it'd be a good idea to just skip a few payments. That also has consequences.

Last CLD by Chase is to be expected whenever a new negative shows up, and they aren't the only ones.

If your Fico is 630, even with recent late, that's on a very low side and indicates utilization problems if that late is your only negative.

I suggest you focus on paying down your balances.

Chase will not restore your previous CL.

At a later date, maybe after a year or so you could ask Chase for increase but that will require a HP.

Meanwhile, you can try GW approach with Synchrony, but I'm not sure how receptive they will be.

Re: Credit Line Catch-22

Remedios — Sun, 04 Apr 2021 05:28:38 GMT

@Anonymous wrote:
I already have a dispute filed with Experian & Transunion about this, thanks.
More miffed at Chase and a bit puzzled why this affected only that account. I have three cards with them.

What are you disputing?

If that late is legit, dispute will drop your score further. Synchrony will not remove it, that's not what disputes with CRA are for.

Re: Credit Line Catch-22

Anonymous — Sun, 04 Apr 2021 05:53:33 GMT

Credit utilization was hovering at 93% 12/20.

Had it down to 78% 3/21, but that was before Chase lowered the line on the Freedom card.

Paid off the two smallest balances (Discover, $1300; old Avant card, $1000) February.

Paying off smaller Chase card next week ($2900 on a $4K line), BoA end of May ($4500 on a $5500 line).

The other two Chase cards will be paid off July/August ($5500/$6800 line, $6500/on what is now $7300 line, reduced from $8700).

Was looking for feedback along the lines of Moderator - seems Chase is on autopilot and my best bet is to proceed as above and just ride it out. Thnx.

Re: Credit Line Catch-22

Anonymous — Sun, 04 Apr 2021 05:55:04 GMT

Disputing two-weeks versus thirty days.

Re: Credit Line Catch-22

Anonymous — Sun, 04 Apr 2021 06:10:51 GMT

@FinStar wrote:
Hello @Anonymous and welcome to the forums.

So, just so I'm on the same page in digesting the above, you deliberately delayed the Lowe's payment due to this botched delivery? Did you address this directly with Lowe's at the time? Did you also discuss this with SYNCB as far as the issue?

Unfortunately, given that Chase already has an internal record of the skip-a-payment (COVID relief) and with the recent late payment, it appears it's created a balance chasing condition (automatic). Since I'm assuming the balance is a fair amount given the step-down reduction on your revolving limit, they're simply mitigating risk since they've picked up on some distress flags. Firing up a letter may not yield much as far as restoring your limit, though.

What is your aggregate utilization or balances across all your accounts? You mention 3 Chase cards and BoA.

Helpful info, thnx.

Re: Credit Line Catch-22

Remedios — Sun, 04 Apr 2021 06:01:14 GMT

@Anonymous wrote:
Disputing two-weeks versus thirty days.

Make sure to provide supporting documents with this dispute.

Provide them with the statement showing due date, and the date you made payment/payment was withdrawn from your bank.

I don't know if you did this already, but usually first step is direct dispute which is with Synchrony. If that doesn't work, it's CRA. If that doesn't work CFBP if that really wasn't 30 day late.

Re: Credit Line Catch-22

Anonymous — Sun, 04 Apr 2021 06:02:37 GMT

Appreciate the straightforward response and good info, thanks. Was surprised Synchrony did this - problem arose when Lowe's promised to reverse a charge for an undelivered item, then didn't. I thought they had, bill didn't get paid on time, and here we are. Still fighting with Lowe's.

Re: Credit Line Catch-22

Anonymous — Sun, 04 Apr 2021 06:59:29 GMT

@Anonymous wrote:

Here's the issue - I got into a spat with Lowe's over a botched delivery and delayed paying that puny balance of $100 two-weeks past the due date. Synchrony Bank, those charmers, reported the late payment. I closed the account - the credit line was minimal and I ain't shopping at Lowe's no more, so no big deal EXCEPT how that impacted my Chase Freedom account.

Any and all advice is welcome.

Since you mentioned any and all advice here is just a tip. Setup autopay on all your credit cards. They sometimes make this feature hard to find online or in app so if you can't figure it out definitely give the creditor a call to activate it. Should save some headaches.

Re: Credit Line Catch-22

Anonymous — Sun, 04 Apr 2021 15:58:45 GMT

Thanks. Being a freelancer/gig worker, autopay presents its own risks since income is variable, so I use payment reminders instead. That wasn't an option with this card, though. No matter, the account is closed now.

One of the posters mentioned balance chasing, which I'd never heard of. Did a bit of research on that topic which has me wondering if my Synchrony issues are totally unrelated to Chase's actions and just happened to overlap. I haven't used my Chase Freedom card in about a year - locked the card and just started heaving payments their way. This might explain why my CL has been systematically reduced on this card and not my other Chase cards, which I use to pay regular small bills (gas, Norton subscription, LinkedIn subscription, etc.).

So, those of you in the know - would it break the cycle to unlock that card and use to make small charges? Or is it a lost cause at this point?

Re: Credit Line Catch-22

Remedios — Sun, 04 Apr 2021 16:38:39 GMT

@Anonymous wrote:
Thanks. Being a freelancer/gig worker, autopay presents its own risks since income is variable, so I use payment reminders instead. That wasn't an option with this card, though. No matter, the account is closed now.

One of the posters mentioned balance chasing, which I'd never heard of. Did a bit of research on that topic which has me wondering if my Synchrony issues are totally unrelated to Chase's actions and just happened to overlap. I haven't used my Chase Freedom card in about a year - locked the card and just started heaving payments their way. This might explain why my CL has been systematically reduced on this card and not my other Chase cards, which I use to pay regular small bills (gas, Norton subscription, LinkedIn subscription, etc.).

So, those of you in the know - would it break the cycle to unlock that card and use to make small charges? Or is it a lost cause at this point?

They are related.

If your Chase cards are maxed or near maxed, it was inevitable, however the presence of new late hastened that a bit.

The way they see it is that you're struggling to pay your cards off, and now you've defaulted.

Just because CLD happened on one card doesn't mean they wont go after the other ones. You have a perfect storm brewing, so your best bet is really to keep paying as much as you can while working on that late.

You cannot stop balance chasing, it will continue till limit is either at a place where lender is comfortable or till closure (hopefully not)

Re: Credit Line Catch-22

Anonymous — Sun, 04 Apr 2021 17:12:24 GMT

I'll take your response under consideration and wait and see how the dispute plays out - it was a "perfect storm," as you put it, last year and would have made sense then, but now the clouds have cleared and the balances are falling at a fast clip courtesy of a new job. The only negative impact on my CRs has been credit utiIization. I'm curious to see how the Lowes/Synchrony thing plays out.

If that was the tipping point, then I'll keep going as I've been. The plan is to get rid of all of it, and I'm making great strides in that direction. Again, they'll all be paid off by September. I'll wait another six months for the dust to settle, then reassess what's worth keeping, or not, and move toward a card offered through my Fidelity brokerage account.

Cheers!

Re: Credit Line Catch-22

Anonymous — Sun, 04 Apr 2021 17:39:08 GMT

@Anonymous wrote:
I'll take your response under consideration and wait and see how the dispute plays out - it was a "perfect storm," as you put it, last year and would have made sense then, but now the clouds have cleared and the balances are falling at a fast clip courtesy of a new job.

Cheers!

I think the "perfect storm" (a cliche I dislike, but ok!) Remedios is referring to was because of the reported late. So with lasting high utilization, it's as if the issuers put you on a watch list. As you start paying off, they may not choose to balance chase as the situation isn't negative enough. But as soon as the late is reported, that's the evidence they need, this person is probably in some trouble, let's protect ourselves.....

Re: Credit Line Catch-22

Remedios — Sun, 04 Apr 2021 19:15:57 GMT

@Anonymous wrote:
@Anonymous wrote:
I'll take your response under consideration and wait and see how the dispute plays out - it was a "perfect storm," as you put it, last year and would have made sense then, but now the clouds have cleared and the balances are falling at a fast clip courtesy of a new job.

Cheers!
I think the "perfect storm" (a cliche I dislike, but ok!) Remedios is referring to was because of the reported late. So with lasting high utilization, it's as if the issuers put you on a watch list. As you start paying off, they may not choose to balance chase as the situation isn't negative enough. But as soon as the late is reported, that's the evidence they need, this person is probably in some trouble, let's protect ourselves.....

You're such a bitter pill to swallow sometimes, but it's possible you woke up on a wrong side of the bed, got your knickers in a twist, saw writings on the wall, and experienced gut wrenching pain.

As a peace offering, I give you this silver lining since you love emojis more than life itself 🥴🤯🥰🧐🙄🥺😬🤐🤯🤕😱👺👻💘

Re: Credit Line Catch-22

Anonymous — Sun, 04 Apr 2021 23:27:23 GMT

@Remedios wrote:

You're such a bitter pill to swallow sometimes, but it's possible you woke up on a wrong side of the bed, got your knickers in a twist, saw writings on the wall, and experienced gut wrenching pain.
As a peace offering, I give you this silver lining since you love emojis more than life itself 🥴🤯🥰🧐🙄🥺😬🤐🤯🤕😱👺👻💘

Where are the mods to steer a conversation back on topic! Oh yes. But thanks. As my (rather insane) grandfather used to say "Better to have an emoji and not need it, than need an emoji and... um, can I have another drink?"