@CreditCrusader wrote:
@Revelate wrote:
@CreditCrusader wrote:
@Superduper2014 wrote:Interesting article. Very revealing.
https://www.bankrate.com/finance/credit-cards/issuers-lower-credit-limits-coronavirus-response/
But wait...I read here in FicoForums that this wasn't happening...that it was happening to just a small segment of the card-holding community.
I remember the recessions of 2000 and 2008 very clearly. In 2000, I walked into my long-time bank with pristine credit and was told that a $2,000 personal loan had to be fully secured...with cash. I asked how that was any different than using my own money and the loan officer said it wasn't, but that their terms required security during those economic times.
I've been saying it here for weeks now: This in-the-process recession is REAL...and it won't turn around in a snap, so folks should prepare for some hard credit times to follow, regardless of your file/FICO score unless you have millions in the bank and are prepared to prove it.
Edited to add: Just because YOUR lines have not yet been cut doesn't mean they won't be. CCCs don't owe anyone large lines or multiple cards...and you really have no recourse if they get ultra conservative with their lines and products during a recession. Planning for the worst means you can weather any credit storm, even during a recession.
And I'll reply the same thing as I did the last time someone posted that click bait article
.
myFICO members, especially in this subforum push boundaries. If it were really as widespread as suggested we would hear screaming here with the mods rushing to consolidate all the posts into a single thread for some hope of sanity. See NFCU and Duck Card and all the other rabbit holes right or wrong we've gone down on this forum.
That has not happened yet, it most certainly hadn't happened two weeks ago when bankrate posted that article.
Everyone, including banks, is holding their breath. Really we are just seeing the opening moves for example by airlines with retiring some of their fleet earlier than planned. Also a whole bunch of those unemployed may well be the underbanked too.
Don't get me wrong, arguments about statistics aside this whole C19 thing sucks blue whale... but we aren't back in the throes of the mortgage crises where people were defaulting on billions of dollars worth of mortgages.
The scale of consumer debt on credit cards is dwarfed by that problem, and credit cards have been cash cows for the lenders. If nothing else, limit chasing in the OP's case, we saw that in the sunshine and happy credit days too (2013 through 2019) and we didn't have COVID to worry about then.
When good credit / financial profiles start getting whacked for various things including non-use, that will be a change, or if we get a tidal wave of closures. This, not so much.
ETA: I probably am on some people's canary list for Amex - no real use for most of a decade and sitting with ~45K in limits with a Zync annual fee and something like $30/month averaged over that time period other than sub chasing. Not a good Amex customer TBH.
Not yet, but give it time. Landlords/mortgage holders can only wait so long for payment...and millions of lost jobs aren't coming back because many businesses are closing their doors for good, not temporarily.
Sooner or later, people who are currently kept afloat by UE and stimulus checks will have to bring current months of past due mortgage payments. Is the government going to order banks to not foreclose on those homes? Methinks that's not happening.
I get what you're saying, but I heard this sort of optimism in 2000 and 2008:
"This won't affect me! I don't hold dot com stocks (2000) or have a mortgage at WAMU (2008), so I'm good."
Except that ALL bad recessions hit EVERYONE in some fashion or another. There will be no bank bailouts this time, so AA on a wide scale is not only possible, but likely, IMO.
That's not guarunteed either; to be sure I'm expecting things to get worse before they get better but it's anyone's guess how things are going to go honestly as nobody really knows what's going to happen with the massive experiments in Georgia and Texas among other places. Actually speaking of bank bailouts, Chase put $8B (yes Billion) into reserve out of cash flow, sure some lenders will probably fail just like some airlines quite probably will, but widespread panic in the financial markets? Mortgage crisis, wiped out 13 TRILLION of consumer net worth. Different order of magnitude. Some people will lose their precious dividend (sorry iced) but that's not main street.
Also I suspect other than the stock losses I came out worse from dotcom than many people, I was on the sidelines for years unable to find work even when I was willing to take anything for a buck and even then I wound up in something not really related except still in IT, and I meet lots of people with Cisco serial numbers these days and none of theirs is lower than mine was /shrug. Not having a degree was a real detriment back then in my industry but off topic.
What places do you really think aren't coming back? Retail has been sinking for the last decade, and COVID I think is going to hasten the departure of some that were still hanging on as I don't think people are going back to brick and mortar retail... even though Amazon has been performing worse on their shipping than ever before in my opinion in terms of packages just never arriving or arriving days or even weeks late in some cases but their customer service hasn't flapped and so if there's still fine grained sand on my floor because I can't get the vacuum cleaner (yet) ain't going to cry. Microfiber towel couldn't get it, fail me.
Construction, specifically corporate building construction, might, and I mean might, be over. The true side hustle probably isn't going to renew the expensive Los Angeles area lease, just let people work from home and grab a WeWork or whatever for occasional meetings that would really be facilitated with a whiteboard and a marker and save probably $10m/year. It's just more awkward when you can't pass the marker around TBH. That's actually where I'm expecting more financial pain to be seen, but the people holding those buildings sorry that's not main street either.
Everywhere else though, jobs in service / travel will be down for a few years probably but gone? Don't think so, too many people with disposable incomes didn't lose their jobs and I know if the business liability shield gets through Congress I'm going to be on the next flight to either Providence or Topeka depending when it happens.
But claiming that lenders are paring back their credit card portfolios already in wide swathes is flatly false. Could happen, sure, things could get much worse, but they haven't yet which is the point I was trying to make.
I'm a bit confused. If you have the money to pay off the balance why would you pay a BT fee on another card? Just trying to stay liquid I guess? If everyone's guesses are correct, and the balance is somewhere around 20k, even given a 3% fee you'd still lay out an extra $600. Something just seems off with the narrative. Having high usage on a single card and applying for three new cards looks like you're either going to BT or just start racking up charges on new cards and not address your old debt.
@Remedios wrote:
@longtimelurker wrote:
@Remedios wrote:People seem ready to blame COVID-19 for dinosaurs extinction.
Oh, another one convinced by mainstream media that the dinosaurs are extinct. LOL. What do you think are in those heavily guarded big warehouses near the intersection of I85 and I26?
Samples of flat Earth. Everyone knows that, @longtimelurker
I'm sorry, but this is impossible.
@elixerin wrote:
@recoveringfrombk7 wrote:I'm a bit confused. If you have the money to pay off the balance why would you pay a BT fee on another card? Just trying to stay liquid I guess? If everyone's guesses are correct, and the balance is somewhere around 20k, even given a 3% fee you'd still lay out an extra $600. Something just seems off with the narrative. Having high usage on a single card and applying for three new cards looks like you're either going to BT or just start racking up charges on new cards and not address your old debt.
depends how you look at it, you don't know if he had gotten approved for other tempo BT fee-free card/s, even not,
i'd rather hold on to 20k cash i know im either going to be doing business with, or going to be needing soon elsewhere. $600-$800 on 20k over 12-15 months pales to potential earning off the $20,000 now..
OP listed the new cards (Discover, Citi, and USB). None of those have a 0% fee transfer afaik. And 20k worth of debt can start to get heavy, depending on one's income/expected income. As I said, maybe OP wants to stay liquid and that's fine, but not surprising that it's spooking AMEX. Especially since OP says only minimum payments were being made.
