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AMEX Financial Review: DO NOT BE SCARED

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Senior Contributor

Re: AMEX Financial Review: DO NOT BE SCARED

lol The problem I would run into, is that I only keep about 20% of my income in the banks! Once my pay deposits, I pull it out and lcok it up.

So on paper I don't "technically" have that much in savings. Heck even my income Tax forms look odd because 60% of it is Tax exempt.

IMO pay subs/w2 are proof enough for what they need.  Digging into your financial assets isn't a guarantee you'll pay your debts anyways

<Mod edit>






Message 31 of 44
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Frequent Contributor

Re: AMEX Financial Review: DO NOT BE SCARED

If I'm paying a credit card company $550 per anum for the privilege of carrying their card and paying off the balance every month, they can afford me the privilege of staying out of my business. Smiley Happy  They didn't have to approve me. As long as my balance is zero at the close of every statement period, then both of us will be fine. Start hassling me after I dump $550 of money just to keep the account open, then we have problems. 

Message 32 of 44
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Mega Contributor

Re: AMEX Financial Review: DO NOT BE SCARED


@adelphi_sky wrote:

If I'm paying a credit card company $550 per anum for the privilege of carrying their card and paying off the balance every month, they can afford me the privilege of staying out of my business. Smiley Happy  They didn't have to approve me. As long as my balance is zero at the close of every statement period, then both of us will be fine. Start hassling me after I dump $550 of money just to keep the account open, then we have problems. 


But again that is not the scenario where you are likely to get an FR!   

Message 33 of 44
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Moderator

Re: AMEX Financial Review: DO NOT BE SCARED

Friendly reminder...

 

Five things we don't discuss on myFICO:  http://ficoforums.myfico.com/t5/User-Guidelines-General/5-Things-We-Don-t-Talk-About/td-p/336929

Message 34 of 44
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Frequent Contributor

Re: AMEX Financial Review: DO NOT BE SCARED


@longtimelurker wrote:

@adelphi_sky wrote:

If I'm paying a credit card company $550 per anum for the privilege of carrying their card and paying off the balance every month, they can afford me the privilege of staying out of my business. Smiley Happy  They didn't have to approve me. As long as my balance is zero at the close of every statement period, then both of us will be fine. Start hassling me after I dump $550 of money just to keep the account open, then we have problems. 


But again that is not the scenario where you are likely to get an FR!   


Good! Smiley Happy

Message 35 of 44
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Regular Contributor

Re: AMEX Financial Review: DO NOT BE SCARED


@CreditCuriosity wrote:

Its their money and their sandbox so they make the rules.  As others have echoed some have no issues yet other do with providing the info.  I disagree though as it is UNSECURED debt and a big risk regardless what a persons credit score or income is.. When you buy a house you provide this info and that is a SECURED debt that can be taken from you if you default for whatever reason.   So IMO I think all CC companies should verify income maybe just by w-2's or Pay Stubs or whatever else less intrusive than 4506's and I can pretty much guarantee you there would be less CO's and defaults benefiting the consumer most likely as a whole with lower apr's or possibly better rewards.   People have strong feelings on both side of this argument and no one will ever win.  OP provided which is great others choose not to and most likely would have their accts closed by Amex.  Around the circle we go.  Glad it all worked out for the OP though.


I agree with you in part. If Credit Card companies want to verify income, then they should. I have no problem with them protecting themselves by doing so. However, it just seems like fubar to me for them to be giving Instant Approvals, and then later on - be it a few days later, or months later,  be freezing accounts and asking you provide the income verifcation that they could have ask for BEFORE they approved the application. 

 

It's like in the case of the OP, he say they approved his Everyday Card, and then 2 days later put him into finanical reviews... The OP said ..."The agent I was assigned was very informative, and told me that FRs are triggered when the computer thinks you're a potential credit risk."  

 

I can see why they would do a FR on someone asking for CLI in very a short time after using the card, in order to make sure your income has increase enough to justify the increase, or if someone later is running up large charges with them out of their norm, or not using thier card responsibliy...etc. However, if someone just applies and is instantly approved, then I don't get why the computer isn't flagging "potential risks" at that point to trigger the application to go into some sort of stage like 'we can not approve your application at this time, further review needed. will get back you"...etc.  You know what I mean ?

 

I also don't get the sentivity some have said that Amex has with the "spending power" tool.  If you don't want people to test what their limits are, then why have the tool available to people at all ?  How is a person suppose to have an idea of what is or isn't in their range ?  Just because someone inputs a bunch of different amounts, even very high ones, doesn't mean they are looking to bust out the account.
Can I put a $1,000 TV on my card ?  Can I buy a couple of $5,000 first class plane tickets ?  Can I put a $10,000 down-payment on the purchase of a BMW ?   Can book a $20,000 reservation at a posh resort ?     Call me crazy, but I like knowing beforehand what my limits are so I don't end up looking like a shmuck-on-wheels getting declined on a card in front of others..

GoingGold
*UPDATED AS OF 08/06/2020*
EQ: 707 ___ TU: 691 ___ EX: 692
Utlz:40% ___ Old Lates/COs: 1 ___ Collections: 0 ___ Public Records: 0 ___ Last Late: 2.1 yrs ___ AAoA: 7.1 yrs ___ AAoOA: 23.10 yrs

AMEX PLATINUM ___ AMEX GOLD = $3,000 (P.O.T) ___ AMEX BONVOY BRILLIANT = $5,000 ___ AMEX CASH MAGNET = $1,000
CAP ONE VENTURE = $30,000 ___ CAP ONE QUICKSILVER = $3,500 ___ CAP ONE PLATINUM SECURED = $500
BANK OF AMERICA CASH REWARDS = $15,000 ___ BANK OF AMERICA PREMIUM REWARDS = $15,000
DISCOVER IT MILES = $13,900 ___ FIDELITY INVESTMENTS CASH REWARDS = $12,400
**TOTAL OVERALL CREDIT LIMIT = $96,300
Message 36 of 44
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Regular Contributor

Re: AMEX Financial Review: DO NOT BE SCARED

I never have been subject to a financial review and am not even sure what generates them and I have had a substantial amount of credit accounts including multiple American Express accounts and other issuers.

 

If I ever received a financial review with an issuer,  I would terminate business with them and they would be the one who loses out on revenue.  If the the issuer does not trust me, then I surely do not trust them and will not provide any additional information to them.  Providing any additional information becomes a liability and a privacy concern amongst other issues on my behalf and there will always be an issuer out there who will have mutual respect with you who will not do a financial review.  So while people who have the appropriate documentation may be willing to submit it, I surely would not recommend doing so. 

Message 37 of 44
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Mega Contributor

Re: AMEX Financial Review: DO NOT BE SCARED


@CreditCuriosity wrote:

   So IMO I think all CC companies should verify income maybe just by w-2's or Pay Stubs or whatever else less intrusive than 4506's and I can pretty much guarantee you there would be less CO's and defaults benefiting the consumer most likely as a whole with lower apr's or possibly better rewards.   


Which then raises the question of why they don't....   Maybe not effective (easily forged by those that want to, which is the power of the 4506-T route),  or not predictive (people with stated appropriate income run into trouble anyway), puts good customers off, or something like that.   If it was a good way of cutting defaults without impacting profit, issuers would be doing it in a heartbeat!

Message 38 of 44
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Moderator

Re: AMEX Financial Review: DO NOT BE SCARED

The age old, great debate.   Want to reduce your risk of an FR so you don't have to have your dependents information shared and all the other blah, that comes with this specific subject.  STOP asking for credit lines you don't need just to have them.  Do you ever hear of anyone with $1k limits getting and FR?  Not saying it hasn't happened but I can't think of any thread in my time here that mentioned anything of sorts.  

 

If the company issues you an initial high line, reduce it to what you ACTUALLY need.  Will it prevent an FR?  Maybe, maybe not...but it can't hurt.  Don't do obvious things that draws attention to yourself, (i.e. spending way outside of your normal range, maxing out a new card, manufactured spending, etc).  If you need to change your spending pattern temporary at least give them a call or a heads up.  

 

Often I read that folks say that will only provide a 4506T for a mortgage loan.  I've read on this here forum of folks who have more in unsecured credit from ONE lender than I spent on my first house.  While some may have very well spent more than $100k for their first home...I didn't.  My point is, if you're willing to provide a 4506T to a lender for mortgage reasons, whats the huge deal when a lender gives you unsecured credit that sometimes exceeds that of a mortgage of middle class America?

 

I also think the lenders have to own some of this nonsense themselves.  Request income prior to approval.  There are a few lenders that we're all aware of that will request POI regardless of what your stated income or credit score is.  Put everything in to manual underwriting.  Is it time consuming, sure.  Requires more manpower, absolutely.  Cost more, you bet!  

 

A little leg work from them up front *could* potentially eliminate some of their risk later.  And while they're at it, stop the silliness of this 3x CLI.  If a person truly needs and increase and you want to stick with the 3x deal...then consider 3x of actual spend annually with a NO CLI clause in the first year.  Will it upset some...sure, mostly myFico forum folks...but probably a little less in the general public. 

 

As consumers...we have to accept some of the blame to.  We often use these lenders to pad our utilization...essentially tricking an algorithm into thinking we're spending less than we actually are via the increased lines of unused credit.  It's not the lenders job to maintain your utilization in the lower percentile nor for them to help increase your score by hiding the debt your actually carrying.

 

You hear AZEO around here so much but in the same threads you hear, CLI, 3x...don't need it but helps for padding, blah, blah.  On the flip side you hear, I've only got 3% reporting...but their signature shows $580k in available credit.  Well 3% of $580k is still $17.4k in debt...which is A LOT.  

 

There's enough blame to go around in regards to this whole FR debate and neither party has clean hands.  Just my 2¢.

Message 39 of 44
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Regular Contributor

Re: AMEX Financial Review: DO NOT BE SCARED

I am not willing to submit financial information to banks for mortgages with tax forms or the like.

 

I paid for my residence in full without mortgage and I only use Credit cards to pay in full and to receive rewards and benefits and so I don’t have to carry cash.  Initial request of information on the application is all that should be required.  

 

Anything more and I do not do business with them.  American Express did send me a letter once with was worded to make it seem like my credit was bad and my interest rate which I do not use was increased.  I ran a free credit report to check my credit and nothing changed.  I then get a letter from American Express apologizing for the mistake and that my interest was changed back to the original rate.  I wrote to the company about it and this was before the new Amex CEO came in.  

 

I don’t know if this alleged mistake happened just to me or many other Amex cardholders.  I do not use interest but interest rates can be negotiated with the institutions if you use them

 

 

Message 40 of 44
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