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Account Closures

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redpat
Senior Contributor

Re: Account Closures

Most don't need over 200k in available credit.  3x Amex CLI is probably the most famous threads here.

 

I think ones available credit might come into play vs. income when the creditors know it impossible to pay if it gets that high.  This is way they are starting to ask about savings and liquid assets for CLIs.

 

Sure I wanted to see how much I could get for fun then I closed cards reducing about 120k in credit because I didn't need or couldn't use it.  There is what you call padding but some really over pad their credit.  

So must of us won't hear from a creditor regarding these matters.  My focus is on rewards for enjoying  travel at a greatly reduced cost, so having 19 cards and 500k in credit can't do that for me.

 

 

Personal Cards: Amex Plat | Amex Delta Res | CSR | Citi AA Exec Business Cards: Ink+ | Amex BGR
Message 11 of 63
Gmood1
Super Contributor

Re: Account Closures

The economy is excellent? Maybe on the surface. If you look deep enough, you'll find the cracks. The trucking industry isn't collapsing for no reason at all.

I've already had a couple of my limits reduced by the lenders. I expect a few more. No biggie, not going to lose sleep over it.
I do have a lot of unsecured credit though. It comes with the territory.

This is one of the reasons I gravitate to the CUs over the BIG banks. They're not immune either.
But I feel, they generally leave you be as long as you're not defaulting or on the cusp of defaulting.
Message 12 of 63
CreditInspired
Community Leader
Super Contributor

Re: Account Closures


@longtimelurker wrote:

@Anonymous wrote:

Today, I've seen a lot of account closures, not just with DISCOVER, but with BoA and Amex. This is one day. Probably more to come,  and with other lenders. We are such a small population, so this might involve 10s of thousands of accounts,  if not many more.

 

 


We are a small population, but probably WAY more risky than the general population!   A lot of people come here initially for rebuilding, so they already have some negatives which may be visible to lenders.   Then people here tend to have a lot more cards than others, and I'm sure ask for CLI or APR reductions much more than the normals out there.   So I don't think you can extrapolate a lot from here.  

 

That said, there may be a trend to more of these being reported here, which is of obviousl interest to us, but again, an increase here might not transfer to the wider world as issuers may be more nervous about us that the average person with a small number of cards they have kept for years.


My thoughts exactly!


|| AmX Cash Magnet $40.5K || NFCU CashRewards $30K || Discover IT $24.7K || Macys $24.2K || NFCU CLOC $15K || NFCU Platinum $15K || CitiCostco $12.7K || Chase FU $12.7K || Apple Card $7K || BOA CashRewards $6K
Message 13 of 63
Anonymous
Not applicable

Re: Account Closures

Nobody ever seen ecomony crash coming until it hits them in the head. Downturn could be 5 years away, 1 year away, or just months ahead.

 

Economy is doing great for rich people, but no economy is stable when wealth disparity is shooting through the roof, even rich people knows that.

Message 14 of 63
Anonymous
Not applicable

Re: Account Closures


@wasCB14 wrote:

One source of lender caution has been rising default rates on auto loans.


Could be, but this seems calculated at the time of the year turn. This might be a planned thing in 2020, at least for some issuers.

Message 15 of 63
Anonymous
Not applicable

Re: Account Closures


@Gmood1 wrote:
The economy is excellent? Maybe on the surface. If you look deep enough, you'll find the cracks. The trucking industry isn't collapsing for no reason at all.

I've already had a couple of my limits reduced by the lenders. I expect a few more. No biggie, not going to lose sleep over it.
I do have a lot of unsecured credit though. It comes with the territory.

This is one of the reasons I gravitate to the CUs over the BIG banks. They're not immune either.
But I feel, they generally leave you be as long as you're not defaulting or on the cusp of defaulting.

I look at the DOW transports. They are often a leading indicator of a changing economy. They look good. The logic behind it is if shipping companies (FedEx, UPS, trucking companies) aren't shipping, then people aren't buying (online purchases, stocked shelves aren't turning over, etc.). Not sure if there isn't a glut of trucking companies out there.

 

Do you think maybe banks are looking to lend at a higher level in 2020, and that unused, bloated CLs on credit cards need to be trimmed to free up credit lines for installment loans or business loans?

Message 16 of 63
Anonymous
Not applicable

Re: Account Closures


@eastsea wrote:

@Anonymous wrote:

 

Now there are trifectas, 19 cards in a wallet, etc which is not uncommon now.

 


I would venture to say 19 cards in a wallet is indeed uncommon among general population.  


A lot more common than it used to be. Even 8 is a lot. 3 or 4 used to be excessive not too long ago.

Message 17 of 63
Anonymous
Not applicable

Re: Account Closures


@longtimelurker wrote:

@Anonymous wrote:

Today, I've seen a lot of account closures, not just with DISCOVER, but with BoA and Amex. This is one day. Probably more to come,  and with other lenders. We are such a small population, so this might involve 10s of thousands of accounts,  if not many more.

 

 


We are a small population, but probably WAY more risky than the general population!   A lot of people come here initially for rebuilding, so they already have some negatives which may be visible to lenders.   Then people here tend to have a lot more cards than others, and I'm sure ask for CLI or APR reductions much more than the normals out there.   So I don't think you can extrapolate a lot from here.  

 

That said, there may be a trend to more of these being reported here, which is of obviousl interest to us, but again, an increase here might not transfer to the wider world as issuers may be more nervous about us that the average person with a small number of cards they have kept for years.


We are, but maybe not more risky. A lot of people here have decent scores, and know how to somewhat manipulate the scoring models to maximize score. But lenders look at more than score. A lot of people carry credit card debt out there, and a lot of people PIF out there as well. We see that mix here too.

 

We also do maximize CLs here too. But that doesn't explain account closures. It would explain CLDs.

Message 18 of 63
Anonymous
Not applicable

Re: Account Closures


@Anonymous wrote:

Discover led the charge to get rid of benefits on cards and other issuers followed. Hopefully we don't see the same thing happen with requests for tax transcripts. 


Or even more things like scaling back rewards, devaluation of points, etc.

Message 19 of 63
Gmood1
Super Contributor

Re: Account Closures

I don't know @Anonymous. That could be the case, but I doubt it.

I know several people on the inside of the trucking industry( owner operators and brokers). Not one of them says things are great right now.
A lot of them are going under. The economy isn't as great as you've been led to believe.


Message 20 of 63
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