AMEX: How much above minimum payment to avoid trouble?

[red259]

I think part of what they may also look at is your account history with Amex. For example, if you have other cards in good standing with Amex (and a payment history) I like to think they would not take AA against you for carrying a balance on a 0% apr.

[cashnocredit]

There is way too much focus on just Amex payments.

Starting a few years ago lenders started reporting payments made as well as balances. You can bet your last dollar that this is what Amex is going to be looking at. They will want confidence that you can repay debts, nothing more. If you are running a total utli of 20% across your lines but you only make 2x the minimums over more than a few months they are going to be more concerned than if you make 2x the minimums but are running 40% util.

It's not a coincidence that their new interest in revolving customers coincides with the new detail reported across your lines. For the first time this data will carry info on your capacity to carry additional debt. This will guide decisions about CLIs as well as CLDs and FRs.

They aren't the only ones looking at this.

[Brax]

I noticed all three CRA paper reports (most detailed) have no AAP (actual amount paid) data from Amex for every Amex card on my report. It would seem bean counting one's payment amounts aren't of a particularly huge concern to Amex. This is just my hunch though and like others have said overall risk profile is much more important.

For any issuer, I would recommend always making at least double minimum payments as the lowest amount.

[score_building]

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@Brax wrote:

...For any issuer, I would recommend always making at least double minimum payments as the lowest amount.

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+1 

[cashnocredit]

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@Brax wrote:

I noticed all three CRA paper reports (most detailed) have no AAP (actual amount paid) data from Amex for every Amex card on my report. It would seem bean counting one's payment amounts aren't of a particularly huge concern to Amex. This is just my hunch though and like others have said overall risk profile is much more important.

For any issuer, I would recommend always making at least double minimum payments as the lowest amount.

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You would be mistaken. Reporting payments is not mandatory. Most CC issuers report them and Amex will happily use the information that others report. They don't need to report their own payments made data - they already are well aware of those. In detail.  Perhaps Amex doesn't wish to share that info or they see no reason to update their CRA reporting systems since they were built on PIF customers.

You are right of course about paying at least double the minimums. That's good advice for all issuer's consumers.

[enharu]

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@Brax wrote:

I noticed all three CRA paper reports (most detailed) have no AAP (actual amount paid) data from Amex for every Amex card on my report. It would seem bean counting one's payment amounts aren't of a particularly huge concern to Amex. This is just my hunch though and like others have said overall risk profile is much more important.

For any issuer, I would recommend always making at least double minimum payments as the lowest amount.

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Amex will have data on your actual payment amounts for your Amex accounts anyways, since they can always review and consolidate the data their internal data and the data that is on your CRs.

Some lenders, such as Amex and Discover, seem to not report actual amount paid, while the majority seem to do so. This is most likely due to the way their systems are set up, rather than them being lazy or not caring about it. The AAP data is just implemented in the past couple years, and some lenders may have yet to upgrade their systems for a variety of reasons, with the high costs associated being the most likely cause.

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@score_building wrote:

I doubt their comments can be construed as paying the min will be overlooked (by their risk analytics) on the new product.

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I was referring to leaving a balance on the card and not paying in full, as opposed to making minimum payments.

From what Amex has said so far, it seems that they are now be more receptive towards customers who are not paying in full, as compared to before. However, no one knows whether they are going to be a lot more receptive towards such behavior, or its just a slight adjustment to their risk algorithm.

Paying only the minimum balance for an extended period of time, especially while dragging high balance(s) and/or having derogs on CR, is pretty much a surefire way to force most lenders, not just Amex, take to adverse action. 

For someone who may just have 2-3 digit balances, paying the minimum may seem to be totally fine, since the balances are so low anyways that it may seem insignificant for the most part. Example: Paying $25 on a $100 balance, which also happens to be paying 25% of your balance, even though it's just the minimum!

However, as common sense predates, as the amount of money owed increases, the payment made should be higher too, and that's mostly for the customer's own good anyways.

[Anonymous]

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@enharu wrote:

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@Brax wrote:

I noticed all three CRA paper reports (most detailed) have no AAP (actual amount paid) data from Amex for every Amex card on my report. It would seem bean counting one's payment amounts aren't of a particularly huge concern to Amex. This is just my hunch though and like others have said overall risk profile is much more important.

For any issuer, I would recommend always making at least double minimum payments as the lowest amount.

---

Amex will have data on your actual payment amounts for your Amex accounts anyways, since they can always review and consolidate the data their internal data and the data that is on your CRs.

Some lenders, such as Amex and Discover, seem to not report actual amount paid, while the majority seem to do so. This is most likely due to the way their systems are set up, rather than them being lazy or not caring about it. The AAP data is just implemented in the past couple years, and some lenders may have yet to upgrade their systems for a variety of reasons, with the high costs associated being the most likely cause.

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@score_building wrote:

I doubt their comments can be construed as paying the min will be overlooked (by their risk analytics) on the new product.

---

I was referring to leaving a balance on the card and not paying in full, as opposed to making minimum payments.

From what Amex has said so far, it seems that they are now be more receptive towards customers who are not paying in full, as compared to before. However, no one knows whether they are going to be a lot more receptive towards such behavior, or its just a slight adjustment to their risk algorithm.

Paying only the minimum balance for an extended period of time, especially while dragging high balance(s) and/or having derogs on CR, is pretty much a surefire way to force most lenders, not just Amex, take to adverse action. 

For someone who may just have 2-3 digit balances, paying the minimum may seem to be totally fine, since the balances are so low anyways that it may seem insignificant for the most part. Example: Paying $25 on a $100 balance, which also happens to be paying 25% of your balance, even though it's just the minimum!

However, as common sense predates, as the amount of money owed increases, the payment made should be higher too, and that's mostly for the customer's own good anyways.

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+1

[Trivolve]

Thanks all. I will compromise by makiong 3x minimum payment (about $120) each month until end of Promo APR, December 2014 when I will PIF. My current util on combined AMEX is $4,000/$22,000 (~18%) so I think I will be fine.