Chase cash advance limits decreased?

[Credit12Fico]

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@AverageJoesCredit wrote:

The only CA i would care about would be my Navy or credit Union cards as they are actually useful . This feature of a credit card is kind of ridiculous in that the issuer wants to flaunt the feature but its taboo to use or gives the image you are desperate.  I dont believe that but i know some people do. Why should they care so long as they get paid. They get crazy interest . No point but just another way to control us consumers. 

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They care because all of their historical data mining shows that cash advances have a higher default risk. The credit card issuers are incredibly quantitative.   Even if we personally are not a default risk, as long as the algorithm stops those who are default risk in greater numbers, then we are just a casualty they are willing to accept.

[Anonymous]

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@Credit12Fico wrote:

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@AverageJoesCredit wrote:

The only CA i would care about would be my Navy or credit Union cards as they are actually useful . This feature of a credit card is kind of ridiculous in that the issuer wants to flaunt the feature but its taboo to use or gives the image you are desperate.  I dont believe that but i know some people do. Why should they care so long as they get paid. They get crazy interest . No point but just another way to control us consumers. 

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They care because all of their historical data mining shows that cash advances have a higher default risk. The credit card issuers are incredibly quantitative.   Even if we personally are not a default risk, as long as the algorithm stops those who are default risk in greater numbers, then we are just a casualty they are willing to accept.

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The "crazy" interest they earn is necessary to cover the losses by those who default on cash advances. 

Cash advances aren't always profitable, mainly when the economy is good. So it's not easy money for the issuers. 

[OmarGB9]

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@Credit12Fico wrote:

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@AverageJoesCredit wrote:

The only CA i would care about would be my Navy or credit Union cards as they are actually useful . This feature of a credit card is kind of ridiculous in that the issuer wants to flaunt the feature but its taboo to use or gives the image you are desperate.  I dont believe that but i know some people do. Why should they care so long as they get paid. They get crazy interest . No point but just another way to control us consumers. 

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They care because all of their historical data mining shows that cash advances have a higher default risk. The credit card issuers are incredibly quantitative.   Even if we personally are not a default risk, as long as the algorithm stops those who are default risk in greater numbers, then we are just a casualty they are willing to accept.

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If the risk of defaulting is so high, why offer cash advances at all then?

[Credit12Fico]

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@OmarGB9 wrote:

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@Credit12Fico wrote:

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@AverageJoesCredit wrote:

The only CA i would care about would be my Navy or credit Union cards as they are actually useful . This feature of a credit card is kind of ridiculous in that the issuer wants to flaunt the feature but its taboo to use or gives the image you are desperate.  I dont believe that but i know some people do. Why should they care so long as they get paid. They get crazy interest . No point but just another way to control us consumers. 

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They care because all of their historical data mining shows that cash advances have a higher default risk. The credit card issuers are incredibly quantitative.   Even if we personally are not a default risk, as long as the algorithm stops those who are default risk in greater numbers, then we are just a casualty they are willing to accept.

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If the risk of defaulting is so high, why offer cash advances at all then?

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Is that default risk 100%? No.  So then there is money to be made...

[NRB525]

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@Credit12Fico wrote:

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@OmarGB9 wrote:

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@Credit12Fico wrote:

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@AverageJoesCredit wrote:

The only CA i would care about would be my Navy or credit Union cards as they are actually useful . This feature of a credit card is kind of ridiculous in that the issuer wants to flaunt the feature but its taboo to use or gives the image you are desperate.  I dont believe that but i know some people do. Why should they care so long as they get paid. They get crazy interest . No point but just another way to control us consumers. 

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They care because all of their historical data mining shows that cash advances have a higher default risk. The credit card issuers are incredibly quantitative.   Even if we personally are not a default risk, as long as the algorithm stops those who are default risk in greater numbers, then we are just a casualty they are willing to accept.

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If the risk of defaulting is so high, why offer cash advances at all then?

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Is that default risk 100%? No.  So then there is money to be made...

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"High Default Risk" from cash advances really needs to be quantified. Overall CC delinquent rates look like 2.4% recently, so if CA delinquency is ____% is that A Lot? 

[Credit12Fico]

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@NRB525 wrote:

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@Credit12Fico wrote:

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@OmarGB9 wrote:

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@Credit12Fico wrote:

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@AverageJoesCredit wrote:

The only CA i would care about would be my Navy or credit Union cards as they are actually useful . This feature of a credit card is kind of ridiculous in that the issuer wants to flaunt the feature but its taboo to use or gives the image you are desperate.  I dont believe that but i know some people do. Why should they care so long as they get paid. They get crazy interest . No point but just another way to control us consumers. 

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They care because all of their historical data mining shows that cash advances have a higher default risk. The credit card issuers are incredibly quantitative.   Even if we personally are not a default risk, as long as the algorithm stops those who are default risk in greater numbers, then we are just a casualty they are willing to accept.

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If the risk of defaulting is so high, why offer cash advances at all then?

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Is that default risk 100%? No.  So then there is money to be made...

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"High Default Risk" from cash advances really needs to be quantified. Overall CC delinquent rates look like 2.4% recently, so if CA delinquency is ____% is that A Lot? 

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I don't think it has to be high risk. Just a little more risky than a standard purchase. So perhaps Chase decided to silently lower to 5%.

After all, a CA can be used to give the apperance of paying off debt elsewhere. 

[AverageJoesCredit]

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@OmarGB9 wrote:

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@Credit12Fico wrote:

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@AverageJoesCredit wrote:

The only CA i would care about would be my Navy or credit Union cards as they are actually useful . This feature of a credit card is kind of ridiculous in that the issuer wants to flaunt the feature but its taboo to use or gives the image you are desperate.  I dont believe that but i know some people do. Why should they care so long as they get paid. They get crazy interest . No point but just another way to control us consumers. 

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They care because all of their historical data mining shows that cash advances have a higher default risk. The credit card issuers are incredibly quantitative.   Even if we personally are not a default risk, as long as the algorithm stops those who are default risk in greater numbers, then we are just a casualty they are willing to accept.

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If the risk of defaulting is so high, why offer cash advances at all then?

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lol, THIS

[Remedios]

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@Credit12Fico wrote:

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@OmarGB9 wrote:

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@Credit12Fico wrote:

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@AverageJoesCredit wrote:

The only CA i would care about would be my Navy or credit Union cards as they are actually useful . This feature of a credit card is kind of ridiculous in that the issuer wants to flaunt the feature but its taboo to use or gives the image you are desperate.  I dont believe that but i know some people do. Why should they care so long as they get paid. They get crazy interest . No point but just another way to control us consumers. 

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They care because all of their historical data mining shows that cash advances have a higher default risk. The credit card issuers are incredibly quantitative.   Even if we personally are not a default risk, as long as the algorithm stops those who are default risk in greater numbers, then we are just a casualty they are willing to accept.

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If the risk of defaulting is so high, why offer cash advances at all then?

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Is that default risk 100%? No.  So then there is money to be made...

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You're making a bit of a circular argument here..."They won't do cash advances because of defaults. Not everyone defaults. They want cash advances to make money" 

CA is what it is. Not every lender abhors the idea, in fact, a lot  of lenders advertise it as  a  selling point for their cards since there is no fee and no separate higher APR for cash advances.

[longtimelurker]

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@Remedios wrote:

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You're making a bit of a circular argument here..."They won't do cash advances because of defaults. Not everyone defaults. They want cash advances to make money" 

CA is what it is. Not every lender abhors the idea, in fact, a lot  of lenders advertise it as  a  selling point for their cards since there is no fee and no separate higher APR for cash advances.

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I don't think it is particularly circular.     Basically, any type of transaction has some risk for the issuer, and also some reward.    So they want to encourage "probably profitable" transactions, but also want to limit the downside if they guess wrong.     If, as I believe, cash advances are more risky, as times become more uncertain, reducing the exposure seems prudent.   (And it's not as if some haven't also reduced purchase CLs!)

Obviously, in an issuer-ideal world they would be able to identify which users are more risky and leave the others alone, but a) not so possible, and b) might be too expensive to implement and maintain, so easier just to do a more blanket decrease.

And yes, issuers do advertise it as a selling point because they know some consumers think it's something they may need/want.  Doesn't mean that they can't be very cautious when it IS used!

[FlaDude]

So far all 4 of my Chase cards are all still at 20% per latest statements. The most recent statement was 10/7. What is the earliest statement date that people are seeing this on?

They seem to be tightening up on issuing new cards, I'm not surprised they are squeezing elsewhere too.

As far as posters noting that Chase didn't notify, that seems par for the course for them. I've had a couple of auto-CLIs from them over the years, and they never emailed or notified via on-line document. I didn't know about the CLIs until I just happened to see them on my account, that's why I call them "stealth CLIs".