Amex APR increase due to FICO score decrease

[SouthJamaica]

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@Credit12Fico wrote:

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@SouthJamaica wrote:

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@7774x wrote:

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@babygirl1256 wrote:

Wow . . . glad to know . . . thanks for posting that information. I'll make sure I keep my card utilizations down and my FICO score high. I've been doing well for the last year and keeping FICO above 800 except for EQ . . . but that score should improve once the last adverse $400.00 (paid) CO purges on 12/1/2022!!!

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Amex  rate hikes look at utilization,increasing credit & Amex payment patterns..i.e late ...

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Reason(s) for Our Decision

We made this decision for the following reason(s):
Your APRs for purchases and balance transfers are lower than the APRs on the same or similar card
products currently offered by American Express for Card Members with similar FICO scores.
Your FICO credit score as provided by Experian.

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You should tell them to lower the APR for those other card members in order to make it more fair 

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  Yeah why didn't I think of that

[UncleB]

I've posted about this elsewhere (although I didn't do a dedicated thread) but a couple of years ago I had the same thing happen.

I don't remember if it was a letter or just an added page to my monthly bill, but in any case here's a copy:

AmexAA.png

My EX had dipped into the 740s due to new accounts and my moving some balances around, which I guess they didn't like (no "guessing" to it, actually, ha). 

I admit it annoyed me, but since I would never use this card to carry a balance under any circumstances I shrugged it off. 

The relationship seems to be fine, though... since then I've had a second installment loan with them (5.98%) and opened a new Schwab Platinum, so they aren't too upset. ¯\_(ツ)_/¯

[SouthJamaica]

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@UncleB wrote:

I've posted about this elsewhere (although I didn't do a dedicated thread) but a couple of years ago I had the same thing happen.

I don't remember if it was a letter or just an added page to my monthly bill, but in any case here's a copy:

AmexAA.png

My EX had dipped into the 740s due to new accounts and my moving some balances around, which I guess they didn't like (no "guessing" to it, actually, ha). 

I admit it annoyed me, but since I would never use this card to carry a balance under any circumstances I shrugged it off. 

The relationship seems to be fine, though... since then I've had a second installment loan with them (5.98%) and opened a new Schwab Platinum, so they aren't too upset. ¯\_(ツ)_/¯

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That's exactly the notice I received

[Gollum]

I don't mean to brag or to be disrespectul to anyone, but of course a FICO score decrease can result in an interest rate increase. That's the whole point of a FICO score.

For example/comparison:

1.) I have excellent FICO scores (my May 2022 FICO score from American Express is 850).

2.) My current interest rate for my BCE (Blue Cash Every Day) credit card is 13.24%.

3.) I have had an American Express offer for a promotional interest rate (for my BCE) of 0% for six months for at least the past two months. I haven't accepted it because it is not useful to me, and I didn't care enough to click on it.

[Anonymous]

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@Gollum wrote:

I don't mean to brag or to be disrespectul to anyone, but of course a FICO score decrease can result in an interest rate increase. That's the whole point of a FICO score.

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Well, "of course" in the sense that with notice after the first year an issuer can change the APR for many reasons.    But I didn't think it happened that often or was so clearly called out as in the letters to @UncleB and @SouthJamaica    Penalty APRs happen in obvious situations and we've seen big issuers, including Amex, "levelling up" too low APRs to fit what they offer newer customers.   But this is in between. 

Presumably there is some threshold, they don't act on 5 point drops but might do so on 50, 100.

So new to me, and while I still disagree with @SouthJamaica conclusion that it makes sense to maximize FICO at all times, I was wrong to doubt that Amex did this for FICO decrease!