topic Re: What's with the AMEX Obsession? in Credit Cards

What's with the AMEX Obsession?

fittiger — Thu, 16 May 2013 14:51:28 GMT

I guess what I'm looking for is a rational discussion on why everyone is so obsessed with having an American Express product? From reading many different users posts and reviews on the AMEX site itself, they seem to be a very finicky company to have to deal with. If they were a person it they would come across as bi-polar.

I've seen numerous reports or concerns about:

* Credit Limit Decreases for carrying a reasonable balance, even on 0% promotions

* Credit Limit Decreases chasing a balance (meaning if you pay down a balance, they reduce the limit to just over that balance keeping UTIL high)

* Financial Reviews for whatever reason

* Customer Service disappointments (rude, foreign call centers, etc)

* High AF on Charge Cards and some Revolvers (Other than credit building, I don't understand why anyone would want a charge card with an annual fee?????)

* Less acceptance than VISA/MC

Granted, they do offer:

* Significant CLI

* Backdating

But, what's the obsession if everyone seems to always be on their toes fearing AA from AMEX? It can't be the prestige factor anymore, I think you can get that from several other banks now.

I"m not against having an AMEX product, but I don't want to deal with worrying what AMEX thinks of my healthy spending/payment habits. For example, I've heard rumor they don't like multiple montly payments.....or see increased risk with spending at discount stores. Whether true or not, the fact that there are rumors like this proves my point.

Thoughts?

Re: What's with the AMEX Obsession?

Anonymous — Thu, 16 May 2013 15:37:33 GMT

@fittiger wrote:
I guess what I'm looking for is a rational discussion on why everyone is so obsessed with having an American Express product? From reading many different users posts and reviews on the AMEX site itself, they seem to be a very finicky company to have to deal with. If they were a person it they would come across as bi-polar.

I've seen numerous reports or concerns about:

* Credit Limit Decreases for carrying a reasonable balance, even on 0% promotions
* Credit Limit Decreases chasing a balance (meaning if you pay down a balance, they reduce the limit to just over that balance keeping UTIL high)
* Financial Reviews for whatever reason
* Customer Service disappointments (rude, foreign call centers, etc)
* High AF on Charge Cards and some Revolvers (Other than credit building, I don't understand why anyone would want a charge card with an annual fee?????)
* Less acceptance than VISA/MC

Granted, they do offer:

* Significant CLI
* Backdating

But, what's the obsession if everyone seems to always be on their toes fearing AA from AMEX? It can't be the prestige factor anymore, I think you can get that from several other banks now.

I"m not against having an AMEX product, but I don't want to deal with worrying what AMEX thinks of my healthy spending/payment habits. For example, I've heard rumor they don't like multiple montly payments.....or see increased risk with spending at discount stores. Whether true or not, the fact that there are rumors like this proves my point.

Thoughts?

IMO people want an AMEX because it's a symbol of "I've made it"... I don’t particularly believe that Amex is the best of the best anymore but it's still upheld as a symbol of good credit.. When you see an Amex is a person’s wallet you usually think "they have good credit".. The zync card was kind of an exception to that rule because although it wasn't a subprime card, it definitely was the easiest Amex to obtain with some people being approved in the low 600's... I feel as if Amex is the "Mercedes Benz" of credit cards.. for some, it’s not so much about the perks you get from Amex as much as it is about being a "status symbol".. Everybody will view this differently but that’s just how I see it..

Re: What's with the AMEX Obsession?

Anonymous — Thu, 16 May 2013 15:49:51 GMT

@Anonymous wrote:
@fittiger wrote:
I guess what I'm looking for is a rational discussion on why everyone is so obsessed with having an American Express product? From reading many different users posts and reviews on the AMEX site itself, they seem to be a very finicky company to have to deal with. If they were a person it they would come across as bi-polar.

I've seen numerous reports or concerns about:

* Credit Limit Decreases for carrying a reasonable balance, even on 0% promotions
* Credit Limit Decreases chasing a balance (meaning if you pay down a balance, they reduce the limit to just over that balance keeping UTIL high)
* Financial Reviews for whatever reason
* Customer Service disappointments (rude, foreign call centers, etc)
* High AF on Charge Cards and some Revolvers (Other than credit building, I don't understand why anyone would want a charge card with an annual fee?????)
* Less acceptance than VISA/MC

Granted, they do offer:

* Significant CLI
* Backdating

But, what's the obsession if everyone seems to always be on their toes fearing AA from AMEX? It can't be the prestige factor anymore, I think you can get that from several other banks now.

I"m not against having an AMEX product, but I don't want to deal with worrying what AMEX thinks of my healthy spending/payment habits. For example, I've heard rumor they don't like multiple montly payments.....or see increased risk with spending at discount stores. Whether true or not, the fact that there are rumors like this proves my point.

Thoughts?
IMO people want an AMEX because it's a symbol of "I've made it"... I don’t particularly believe that Amex is the best of the best anymore but it's still upheld as a symbol of good credit.. When you see an Amex is a person’s wallet you usually think "they have good credit".. The zync card was kind of an exception to that rule because although it wasn't a subprime card, it definitely was the easiest Amex to obtain with some people being approved in the low 600's... I feel as if Amex is the "Mercedes Benz" of credit cards.. for some, it’s not so much about the perks you get from Amex as much as it is about being a "status symbol".. Everybody will view this differently but that’s just how I see it..

Mercedes Benz of credit cards! haha! I have a Amex Plat Mercedes Benz edition.

anyway, I do agree with the above poster that it can be for some a sign of "I made it!", but my personal perspective is that it is jus another prime lender for me to take advantage of. They have a product that I find useful for a period of time. Factoring in sign up bonus, I decide its worth it for me and I go for it. When it not longer suits my needs, its much easier to cancel and amex becuase the next time they have a product/offer that suits my needs, I get backdated.

I would certainly never rely on Amex as my main lender or sole lender. I personally think everyone should have a relationship with each of the major banks that suits them esspecially, Chase, Discover, Amex, Citi, and BOA. This way you keep your options open when you need a particular financial product. And the relationship allows you to more easily take advantage of lucrative offers. Most people however are of the mantra that "credit cards are evil" and thus use mostly cash and debit, leaving tens of thousands of miles/points/cash back on the table every year.

Amex is bipolar and obviously its a YMMV thing, but while in the rebuilding process (which most new myfico's are in), amex is the "I've made it" card and tht 6% groceries on BCP is like a windfall, but once they get even more education into how to fully utilize their credit they graduate to more complex ways of thinking about their credit profile and utilizing their credit (and graduate from myfico too).

Re: What's with the AMEX Obsession?

theoldnocreditmaster — Thu, 16 May 2013 15:53:48 GMT

Years and years ago Amex products were the most sought after cards and very difficult to get. I think that stigma still lingers today. But in my opinion, quite frankly they suck as a creditor. I know you hear it all the time, that people pay their bills in full every month and Amex yanked the carpet out from under them by reducing credit lines or closing accounts that crushed scores.

They are ok for small balances carried for a short period of time, but that’s it. They reduced my CL from 24k to 11K. I got it up to 30K now. I’ve had the card since 2004. I will never charge more than a few hundred bucks during the course of the year with them. During the banking fiasco they were the only one to do this to me. Lucky for me this didn’t start a chain reaction as it did for countless others.

Amex is not what they used to be. Back in 2009 they called me to request some tax documents and I told them to buzz off. I don’t have time to mess around with a credit company that I don’t owe money to and to go pick on someone else, just because they were under pressure by the Feds to verify credit lines and reduce their exposure.

They mishandled it completely. I know of very few people that did not have some sort of contact with Amex during this period. There should never be an obsession with Amex. Those that are, need to reevaluate just how important their credit really is to them. As far as I’m concerned it’s like having unsafe sex dealing with Amex. It’s going to happen, you just never know when.

Re: What's with the AMEX Obsession?

phillyguy12 — Thu, 16 May 2013 15:57:51 GMT

its brand marketing at its best, AMEX is associated with good credit and wealth and some will even say its associated with "old money"

Re: What's with the AMEX Obsession?

Anonymous — Thu, 16 May 2013 16:18:52 GMT

"I made it.... and have been rewarded with 6% back at the grocery store!"...but the backdating is so extremely valuable, expecially if you got an AMEX card when you were young or were added as an AU.

Re: What's with the AMEX Obsession?

Anonymous — Thu, 16 May 2013 16:20:12 GMT

The most commonly said advantages of an Amex is the backdating and ease to get CLI. These because less attractive as your credit history grows and matures.

My history is around 14 years now with an AAoA of around 7 so a brand new card without backdating doesn't hurt as much as someone with a 3 year, 1.2 year AAoA.

Also as your income increases so does your spending power. Cards with age and mature with you so you don't need to rely on a 3x CLI.

I think that the 3x CLI is a good thing but also a negative. In the past you had to show that you earned a larger line by responsible usage and payment. Now it just seems like you need to hold the card for 61 days and you're good.

Re: What's with the AMEX Obsession?

phillyguy12 — Thu, 16 May 2013 16:32:25 GMT

i would also like to add too, you gotta take the source of your info into account, im sure you are dealing w/ a very small subset of amex customers on these forums, and the people here do not necessarily represent the avg consumer and we all know you can't believe everything you read on the internet and i have found myself questioning the validity of some claims on these boards.

Re: What's with the AMEX Obsession?

Revelate — Thu, 16 May 2013 16:38:52 GMT

The forum population and on some other similar boards are extreme outliers on the bell curve.

For the vast majority of individuals, myself included, Amex is just fine. It's unlikely I'm going to get whacked with an FR, I don't carry a balance anyway, and apparently (tinfoil hat time) enough of my transactions are of sufficient "quality" that my internal risk calculation is anecdotally fine.

The brand does matter in some transactions. As a whole they're in the top 2 companies for credit card products in my estimation (Chase being the other), and between charge cards and the CLI practices you can accomplish incredibly useful things while being credit "challenged."

To paraphrase a NASA official recently, backdating is just frosting on the cake, but it's a pretty good cake to begin with.

Edit and PS: AF's aren't a problem if they're justifiable, namely if spend X through one card with $95 AF results in >$95 more cash value rewards than the same spend through a second card with $0 AF, I'll take the AF.

Re: What's with the AMEX Obsession?

DaveSignal — Thu, 16 May 2013 16:35:45 GMT

I don't want an AMEX and never have. I'm happy with the rewards I get on my cards with no fees. And I like having cards that are easy to use in other countries, since I travel frequently.

Re: What's with the AMEX Obsession?

cashnocredit — Thu, 16 May 2013 16:40:00 GMT

"What's with the AMEX Obsession?What's with the AMEX Obsession?"

Never had any of the mentioned problems but I love three things

1. Ability to charge really large amounts (ie: over 50k phone purchase 1 year after getting the card)

2. Ability to report AU spending seperately and set monthly spend limits on individual AUs.

3. Airport lounges.

Re: What's with the AMEX Obsession?

Bay_Area_Joe — Thu, 16 May 2013 16:46:05 GMT

To me it is all about the backdating.

My member date is 1991. And when I opened my Hilton Honors in March 2013, and it shows up 3/1991 as open date.

Does it really get any better than that ?

My current stradegy is to get approved for an Amex every 9 to 12 months, and the same date get another prime card or CLI. AAoA will not suffer.

All because what I learn on this forum.

Thanks

Re: What's with the AMEX Obsession?

Anonymous — Thu, 16 May 2013 16:49:54 GMT

Not ashamed to admit it... I love the prestige!

Re: What's with the AMEX Obsession?

Anonymous — Thu, 16 May 2013 16:59:39 GMT

@Anonymous wrote:
Not ashamed to admit it... I love the prestige!

I think that was the point of the OP's question, there really shouldn't be much prestige, maybe among some populations based on out-of-date perceptions.

This was posted on FT the other day, look at the scores needed....

http://milecards.com/6158/credit-scores-needed-for-the-best-mile-credit-cards-fresh-data/

Hardly an endorsement of "Amex means excellent credit"!

Re: What's with the AMEX Obsession?

Revelate — Thu, 16 May 2013 17:01:41 GMT

@Anonymous wrote:
@Anonymous wrote:
Not ashamed to admit it... I love the prestige!
I think that was the point of the OP's question, there really shouldn't be much prestige, maybe among some populations based on out-of-date perceptions.
This was posted on FT the other day, look at the scores needed....

http://milecards.com/6158/credit-scores-needed-for-the-best-mile-credit-cards-fresh-data/

Hardly an endorsement of "Amex means excellent credit"!

I'm not certain it ever meant that in the wild, think it was more of an endorsement of "Amex means I spend excellently!"

Re: What's with the AMEX Obsession?

fittiger — Thu, 16 May 2013 17:22:43 GMT

@Revelate wrote:
The forum population and on some other similar boards are extreme outliers on the bell curve.

For the vast majority of individuals, myself included, Amex is just fine. It's unlikely I'm going to get whacked with an FR, I don't carry a balance anyway, and apparently (tinfoil hat time) enough of my transactions are of sufficient "quality" that my internal risk calculation is anecdotally fine.

The brand does matter in some transactions. As a whole they're in the top 2 companies for credit card products in my estimation (Chase being the other), and between charge cards and the CLI practices you can accomplish incredibly useful things while being credit "challenged."

To paraphrase a NASA official recently, backdating is just frosting on the cake, but it's a pretty good cake to begin with.

Edit and PS: AF's aren't a problem if they're justifiable, namely if spend X through one card with $95 AF results in >$95 more cash value rewards than the same spend through a second card with $0 AF, I'll take the AF.

Regarding the AF's....I agree they are sometimes very worthwhile, based on rewards and your spending habits. I just don't see the point of the charge card from AMEX. Why not just offer these benefits as a revolver and do what they tend to do if you carry a balance too long and shut it down. What is a "NPSL" good for when there's a limit on what they will let you charge?

Don't get me wrong, I will obtain a no AF AMEX revolver and get the limit as high as I can, but won't really give them much of my business. I just don't want to have to deal with a nit-picky, passive-aggressive, oxymoronic creditor.

I can only guess that their business model strives to make money soley from charge fees and AF's. They just come across as hyper senstive.

This is not to say that AMEX doesn't have its good points; it does. I can also understand someone building credit and becoming an AMEX member being an worthwhile achievement. I just don't get the impression that they value their customers.

Re: What's with the AMEX Obsession?

jsickz32 — Thu, 16 May 2013 17:17:30 GMT

I like my Amex. Dont care about the AFs to be honest.
Amex is not for you then fine but theres no need to start a thread about how you cant understand why people would want an amex....

I dont get why people would WANT to get married but you dont see me starting threads about it lol

Re: What's with the AMEX Obsession?

Revelate — Thu, 16 May 2013 17:20:46 GMT

@fittiger wrote:
@Revelate wrote:
The forum population and on some other similar boards are extreme outliers on the bell curve.

For the vast majority of individuals, myself included, Amex is just fine. It's unlikely I'm going to get whacked with an FR, I don't carry a balance anyway, and apparently (tinfoil hat time) enough of my transactions are of sufficient "quality" that my internal risk calculation is anecdotally fine.

The brand does matter in some transactions. As a whole they're in the top 2 companies for credit card products in my estimation (Chase being the other), and between charge cards and the CLI practices you can accomplish incredibly useful things while being credit "challenged."

To paraphrase a NASA official recently, backdating is just frosting on the cake, but it's a pretty good cake to begin with.

Edit and PS: AF's aren't a problem if they're justifiable, namely if spend X through one card with $95 AF results in >$95 more cash value rewards than the same spend through a second card with $0 AF, I'll take the AF.

Regarding the AF's....I agree they are sometimes very worthwhile, based on rewards and your spending habits. I just don't see the point of the charge card from AMEX. Why not just offer these benefits as a revolver and do what they tend to do if you carry a balance too long and shut it down. What is a "NPSL" good for when there's a limit on what they will let you charge?

Don't get me wrong, I will obtain a no AF AMEX revolver and get the limit as high as I can, but won't really give them much of my business. I just don't want to have to deal with a nit-picky, passive-aggressive, oxymoronic creditor.

I can only guess that their business model strives to make money soley from charge fees and AF's. They just come across as hyper senstive.

I honestly doubt they're anymore sensitive than Chase or BOFA, but given their default rate is the lowest in the industry last I saw, it's hard for me to state their practices are flawed.

My "NPSL" charge card was over 10K when my next closest limit was $2K. Sometimes this is incredibly useful, like paying old tax bills or summer session physics labs in my case. Likewise it's my default card for my employer's travel department, I'm not worried that I may wind up going over on something like the extended trip to NYC I'm apparently stuck with... or the fact I need to actually go buy some suits for the East coast dress code my company has, whereas where I am good jeans, button down collar shirt, and decent shoes overdresses everyone except the executives in my workplace.

Also the charge card is handy to have excluded from FICO's modern ('04/'08 versions) revolving utilization calculation. Unless I'm high balance chasing on some revolver, or I get stuck trying to micromanage my balances because I have an application coming up or playing silly FICO games, it's handy to leave an awkward purchase (size or timing) on the charge card.

I'll admit no lender is perfect and Amex has it's flaws; however, it works for me and so they get the lionshare of my spending as a result.

If they don't work for you, that's fine, it's not personal. Find a lender that does and wrap your arms around them instead and go on with life.

Re: What's with the AMEX Obsession?

cashnocredit — Thu, 16 May 2013 17:21:37 GMT

@Revelate wrote:
@Anonymous wrote:
@Anonymous wrote:
Not ashamed to admit it... I love the prestige!
I think that was the point of the OP's question, there really shouldn't be much prestige, maybe among some populations based on out-of-date perceptions.
This was posted on FT the other day, look at the scores needed....

http://milecards.com/6158/credit-scores-needed-for-the-best-mile-credit-cards-fresh-data/

Hardly an endorsement of "Amex means excellent credit"!
I'm not certain it ever meant that in the wild, think it was more of an endorsement of "Amex means I spend excellently!"

Bingo!

Amex cards get over twice the spend each month of Visa or MC cards. That's the kind of "prestige" merchants care about. But it has almost nothing to do with credit scores which s the focus in credit related forums. It is true many and possibly most consumers think "high credit score" equals high spending but the two are very different. 5 years ago I could phone my banker and verbally have them wire 6 figures to anyone. OTOH, I had no credit cards and simple things like renting a car or even a hotel room required back flips. Credit, and especially credit files, have zero to do with your bank account balances or investments.

So if a Plat Amex helps promote the idea I'm likely to spend money with a merchant then it's the sort of prestige that I value.

Re: What's with the AMEX Obsession?

parakleet — Thu, 16 May 2013 17:31:24 GMT

@jsickz32 wrote:
I like my Amex. Dont care about the AFs to be honest.
Amex is not for you then fine but theres no need to start a thread about how you cant understand why people would want an amex....

I dont get why people would WANT to get married but you dont see me starting threads about it lol