topic Re: Amex rep gave conflicting advice? in Credit Cards

Amex rep gave conflicting advice?

SRT4kid93 — Tue, 10 Dec 2024 17:55:59 GMT

So from the information I have gathered here, most tend to agree that the best way to increase your spending power with Amex is to build up the biggest bill possible, then pay In full once statement generates, this is because many believe that part of the equation is the average of the previous 6 months spending/payments.

so by making the largest payments possible, it tells the computer you can pay back larger amounts of debt. And it gives the computer larger numbers to work with.

however the Amex rep told me the exact opposite and he said to treat it like a debit card and immediately pay off each charge asap.

in theory I guess it shouldn't really matter because either way you are spending the same amount of money. And if you add up a bunch of small payments, it equals the same amount as 1 large payment.

but in practice? It doesn't seem like his advice was very good. Yes Amex wants their money back, and yes paying it off immediately does show your ability to pay back debt very quickly. But doing this will ensure your payments are always very small. And it seems like it would mess up the computer's algorithms in determining your biggest balance/biggest payment in the last 6 months.

I just wanted to share what he said to have a discussion about it. Let me know what you all think.

Re: Amex rep gave conflicting advice?

GZG — Tue, 10 Dec 2024 18:15:24 GMT

as a general rule, stop listening to overseas reps with no knowledge of anything about the systems they are CSRs for, because their desire is just to put together a string words good enough to get you off of the call/chat

amex isn't cap1, they know how much you spend and they how much you pay it off.

pay your bill in full by the due date. that's it.

with amex specifically, if they need you to pay early, they will let you know.

if you get the email to pay early, do it, in full, and train the algorithim that you're good.

Re: Amex rep gave conflicting advice?

Patient957 — Wed, 11 Dec 2024 17:09:25 GMT

@SRT4kid93 wrote:
however the Amex rep told me the exact opposite and he said to treat it like a debit card and immediately pay off each charge asap.

There's plenty of data points on this board about folks getting CLIs from Amex, and I can't recall a single one talking about doing anything crazy or extreme.

Re: Amex rep gave conflicting advice?

JoeRockhead — Tue, 10 Dec 2024 19:34:53 GMT

The whole notion that a lender, any lender doesn't know what you spend unless you let the balance report is, IDK, just nonsense to me. The only difference in allowing a balance to report then paying it down/off by the due date, vs paying it down/off before the statement cuts/reports is when you pay after the statement cuts, the reported balance is then visible to all your other lenders. If you pay it off before the statement cuts, the balance, or spend is only known to that particular lender. While some lenders do report high balance during a billing cycle, not all of them do.

I've seen it debated repeatedly on Reddit that paying the balance before the statement cuts is "not how credit cards were intended to be used". Well, maybe, maybe not... They argue that you can let 100% utilization report on a card, as long as you pay it off by the due date. For argument sake, let's say you're someone rebuilding, or with a young, thin file, with lower scores. You're out here trying to "impress" a particular lender with your spend, so you allow a balance report of 70% of your CL, you pay it off. The next month, you let a balance report of 68%, then pay it off. The third month you let a balance report of 67%, then pay it off.

To every other lender aside from the one you're PIF that you have, they don't see you paid it off, they only see that you "pays as agreed". It looks like your balances are only changing marginally, and you're essentially carrying a sustained high utilization. The high UTI lowers your scores which can be easily remedied by PIF for the next statement, but... what happens if it spooks one of your other lenders and they take adverse action before you do that? You'll be making a sad face.

For young, thin, lower scored profiles, run up that spend to whatever you want, then PIF ONCE (not all this charge then pay multiple times during the month stuff) before the statement to keep your scores up, and reported UTI down, as well as minimizing the chance of AA. If you don't start to see increased CLs after 4 to 6 months of doing this... move on to the lenders that appreciate your usage and reward it accordingly.

Re: Amex rep gave conflicting advice?

SRT4kid93 — Tue, 10 Dec 2024 21:39:17 GMT

@JoeRockhead @Patient957 @GZG

I should mention that I dont know exactly what the rep meant. I can only assume he didn't mean that I should literally make a payment for each charge, that would be ridiculous and terrible inefficient. I could possibly see paying like once or twice a week or something. I didn't ask him to clarify cause I had no intention of taking his advice. Also, not that it matters much but he was an American rep.

but I do want to ask about letting balances post and paying In full then letting a balance post again.

with my capital one card last month I let a large balance post. I have already paid in full. And I was going to let another large balance post for the next 2 months to try to get a CLI. because apparently when it comes to cap one that's the only way to get a CLI (besides combining limits/applying for a new card, but I'm not in the position where I feel comfortable taking on anymore cards right now)

now let's say that Amex sees consecutive months of 50-80% util. Even though I pay it off In full, there's no way for them to see that? So it looks like I'm barely paying the bill/making min payments?

don't get me wrong, now that I think about it like that it makes perfect sense. But that also seems extremely flawed. There should be a 3 options for payment history.

- paid in full

-partial payment

-late

There is a huge difference between staying current, but barely making a dent in your debt. Vs paying in full, and then intentionally charging the card back up and letting it post.

Re: Amex rep gave conflicting advice?

JoeRockhead — Tue, 10 Dec 2024 21:54:10 GMT

@SRT4kid93 wrote:
@JoeRockhead @Patient957 @GZG

I should mention that I don't think the rep literally meant make a payment for each charge. He probably meant like once or twice a week or something. I didn't ask him to clarify cause I had no intention of taking his advice. Also, not that it matters much but he was an American rep.

but I do want to ask about letting balances post and paying In full then letting a balance post again.

with my capital one card last month I let a large balance post. I have already paid in full. And I was going to let another large balance post for the next 2 months to try to get a CLI. because apparently when it comes to cap one that's the only way to get a CLI This is false, My Blue Cap One card in my Siggy has been as high as $80K, all auto CLIs based on higher consistent spend, always PIF before statement cut because it reports to personal reports. I stopped putting any kind of significant spend on it and they auto CLD it to $30k. I don't use either one of them at all now, and look forward to them ultimately closing both accounts (besides combining limits/applying for a new card, but I'm not in the position where I feel comfortable taking on anymore cards right now)

now let's say that Amex sees consecutive months of 50-80% util. Even though I pay it off In full, there's no way for them to see that?
Nope, like I said, all they'll see is your reported balance and your payment history, they can't see the specifics of your payment history in regards to how much you paid last month etc...

So it looks like I'm barely paying the bill/making min payments? If your reported balance from one month to another is similar, that's exactly what it looks like.
don't get me wrong, now that I think about it like that it makes perfect sense. But that also seems extremely flawed. There should be a 3 options for payment history.

- paid in full
-partial payment
-late

There is a huge difference between staying current, but barely making a dent in your debt. Vs paying in full, and then intentionally charging the card back up and letting it post.

Re: Amex rep gave conflicting advice?

SRT4kid93 — Tue, 10 Dec 2024 22:28:48 GMT

Doesn't that feel extremely flawed to anyone else?

The entire point of a credit score is to gauge how one pays debt. But somehow there's no way to see if someone is paying in full and then recharging vs making the minimum payment?

I can't believe I never thought about this until now. I honestly just assumed there was a way to differentiate

Re: Amex rep gave conflicting advice?

NoHardLimits — Wed, 11 Dec 2024 00:01:50 GMT

@SRT4kid93 wrote:
Doesn't that feel extremely flawed to anyone else?

The entire point of a credit score is to gauge how one pays debt. But somehow there's no way to see if someone is paying in full and then recharging vs making the minimum payment?

I can't believe I never thought about this until now. I honestly just assumed there was a way to differentiate

Forum members have various opinions about how best to deal with that situation. Personally, I alternate my cards which report balances so that most report at zero in any given month. I keep track of the last date reported for each account and let about 2-4 months go in between non-zero reported balances. The exception is one account which reports a small balance every month to prevent any accidental "all zero" penalties. That account also has P2 as an AU, so that also prevents the "AU all zero" penalty for P2.

Re: Amex rep gave conflicting advice?

millionsofmiles — Wed, 11 Dec 2024 02:14:06 GMT

No offense to insane people, but only an insane person with no life would make a separate payment for each and every charge they make on a credit card.

@Patient957 Wow. Judge much? 🙄

How 'bout you do you?

Re: Amex rep gave conflicting advice?

Patient957 — Wed, 11 Dec 2024 02:34:48 GMT

@millionsofmiles wrote:
No offense to insane people, but only an insane person with no life would make a separate payment for each and every charge they make on a credit card.

@Patient957 Wow. Judge much? 🙄

How 'bout you do you?

To be clear, I wasn't judging the OP. I definitely was judging the advice to make a payment every time you make a swipe.

If you think making a payment for each and every card swipe is sane, then how about you do you.

Re: Amex rep gave conflicting advice?

SRT4kid93 — Wed, 11 Dec 2024 02:52:51 GMT

@Patient957

Yes I never thought you were judging me, nor was I offended by your comment. I do agree that paying each charge off seems OCD. I would never do it, but if someone managed to find success doing that. Hey why not?

I will say that for me, sometbing switches in my brain when my balance reaches 80-90% of my limit and I start to want to make a payment to clear it out and be able to make more purchases. Which is maybe once a week or two, at most. But my limits are also very small.

Even if we change the quantity of payments to 1-2 payments a week. I still can't see how doing that would help grow your spending power in any way.

When the rep said what he said, I responded with,

"hold on, I thought the computer takes your previous 6 months of payments and takes the average spend and payments for those 6 months"

he then proceeded to tell me that was correct, so then I said "well wouldn't making so many payments mess with those statistics? I can only assume that the computer prefers to see 6 large payments instead of 25-50 tiny ones?

to be fair he didn't seem to have a clear answer on that question, he simply responded with "i tell the same thing to everyone, I personally suggest treating it like a debit card and paying things off asap"

for all we know, this guy may not even carry an Amex card, but still who am I to argue with an Amex employee about what works best? So I left it alone and brought the discussion here.

Re: Amex rep gave conflicting advice?

millionsofmiles — Wed, 11 Dec 2024 03:00:38 GMT

@Patient957 wrote:
@millionsofmiles wrote:
No offense to insane people, but only an insane person with no life would make a separate payment for each and every charge they make on a credit card.

@Patient957 Wow. Judge much? 🙄

How 'bout you do you?
To be clear, I wasn't judging the OP. I definitely was judging the advice to make a payment every time you make a swipe.

If you think making a payment for each and every card swipe is sane, then how about you do you.

@Patient957 Ummm...yeah...nice try, 🙄

Have a seat.

Re: Amex rep gave conflicting advice?

FicoMike0 — Wed, 11 Dec 2024 03:16:28 GMT

@SRT4kid93

The way I look at it, here on this forum, we generally try to hack the system to get higher scores and credit limits. We may be playing by the rules, but we dodge the intent to our advantage. Then, when we run into unintended consequences of our hacks, we are suprised!

The majority of card holder's charge to their card, wait for the bill, then make a payment. When we make payments to manage our utilization, we're outliers. We fall through the cracks of the big data mining exercise that produces the score criteria.

The same goes for trying to game the system for clis.

Nothing wrong with trying, but we can't expect the system to reward us for it.

Btw, my experience with amex is that they don't care much about how much I charge. I have bce. Initial cl $6000. In 6 months, auto cli to $9000. In 6 more months, approved request to $27,000. I don't think I've ever charged more than $1000 to it.

Re: Amex rep gave conflicting advice?

Debt-is-a-Scam — Wed, 11 Dec 2024 03:27:31 GMT

They did this to me as well. Was approved for an Amex BT card, but I didn't know the limit until after accepting the offer. The SL was so low that I told them it's not worth it for me to keep the card so I closed it with the condition that it would not report that I opened and closed the account which they said would be the case. Unfortunately the guy didn't know what he was talking about because it is indeed showing that it was opened and immediately closed, thereby decreasing my average age of accounts. So now I've been trying to dispute that account with the reason being that the creditor agreed to delete it.

Re: Amex rep gave conflicting advice?

Patient957 — Wed, 11 Dec 2024 03:27:26 GMT

@SRT4kid93 wrote:
@Patient957

Yes I never thought you were judging me, nor was I offended by your comment. I do agree that paying each charge off seems OCD.

Yep, we're in agreement. That Amex rep is giving nutty advice.

Re: Amex rep gave conflicting advice?

yam1rts — Wed, 11 Dec 2024 06:30:33 GMT

Since you mentioned buying power I assume you refer to the Amex Gold charge card. Then the CSR is completely right because Amex Gold doesn't have a preset spending limit like your visa or MC, but a charge power. The charge power is adjusted based on usage(charge), you see its not about charging and paying, it's about charging more than your charging power. If that means you must pay before charging more then by all means, make those payments to charge more.

If you call them and ask "what is my charging power" they say 1k. You go and charge 1k, then you can't charge anything else until you pay that off. But if you do pay that off and repeat within the same billing cycle, then you are proving to the system you need a 2k charging power. The more you repeat this, the faster the system will adjust to your "charging needs" and please note, this is not a CLI. Remember, charge cards not only consider factors like your payment history but your spending patterns as well.

Re: Amex rep gave conflicting advice?

SRT4kid93 — Wed, 11 Dec 2024 16:40:52 GMT

Ok so let me ask you all this.

when you check your spending power does that include your current balance?

so let's say toj have a current balance of $1000 and you check spending power for 2,000. Does that mean the system is approving you to spend that $2000 on top of the $1000 you already spent? Meaning technically you can charge $3000? Or are they approving you to charge $2000 total, so only another $1000 with your current balance?

hope that makes sense

Re: Amex rep gave conflicting advice?

yam1rts — Thu, 12 Dec 2024 06:02:54 GMT

@SRT4kid93 wrote:
Ok so let me ask you all this.

when you check your spending power does that include your current balance?

so let's say toj have a current balance of $1000 and you check spending power for 2,000. Does that mean the system is approving you to spend that $2000 on top of the $1000 you already spent? Meaning technically you can charge $3000? Or are they approving you to charge $2000 total, so only another $1000 with your current balance?

hope that makes sense

Exactly, if prior to your 2,000 purchase you check with Amex’s spending power tool, and it’s approved despite having a 1,000 dollar balance, then yes your total charge power has adjusted to 3,000. It’s very dynamic so it has potential to adjust backwards if you stop using the card. With that said, use the tool before big purchases in order to avoid an embarrassing moment.

Re: Amex rep gave conflicting advice?

SRT4kid93 — Thu, 12 Dec 2024 17:02:04 GMT

@yam1rts

Ok that's what I thought. It wouldn't make sense the other way. The whole point is to see if you can afford a purchase. If the spending power included your current balance that would be like telling you "we approve you to spend $2000 but we are going to leave out the part where you can only actually spend $500 since your current balance is $1500"

Doing it that way would defeat the entire purchase. So that makes sense. Thanks

Re: Amex rep gave conflicting advice?

Anonymous — Thu, 12 Dec 2024 21:53:48 GMT

@SRT4kid93 wrote:
So from the information I have gathered here, most tend to agree that the best way to increase your spending power with Amex is to build up the biggest bill possible, then pay In full once statement generates, this is because many believe that part of the equation is the average of the previous 6 months spending/payments.

so by making the largest payments possible, it tells the computer you can pay back larger amounts of debt. And it gives the computer larger numbers to work with.

however the Amex rep told me the exact opposite and he said to treat it like a debit card and immediately pay off each charge asap.

in theory I guess it shouldn't really matter because either way you are spending the same amount of money. And if you add up a bunch of small payments, it equals the same amount as 1 large payment.

but in practice? It doesn't seem like his advice was very good. Yes Amex wants their money back, and yes paying it off immediately does show your ability to pay back debt very quickly. But doing this will ensure your payments are always very small. And it seems like it would mess up the computer's algorithms in determining your biggest balance/biggest payment in the last 6 months.

I just wanted to share what he said to have a discussion about it. Let me know what you all think.

I would disagree with the rep. I would think that showing you can handle more debt and responsibly pay it off -- running up charges and waiting until the cycle closes to pay in full -- is the best evidence of your ability to handle debt properly.