Discover Balance Transfer Question

Mland-EC · ‎02-08-2021

First, my Discover Limit was 3K about 7 months ago, today it is 14K. They gave me an auto one day. I wake up and have an 8K limit(5 k increase). Then I ask 45 days later ask for an increase and they approve me another 2k now I am at a 10K limit. So few months go by and I am in Dec.

I did a balance transfer to checking in Dec 2020 for 9K and that time as I said my limit was 10K. I had a 450.00 used on the card when asked so I owed very near my entire limit after that BT.

I chose the no fee 3%(some months it's 4%) because I knew I was going to pay it back fast. Well I did pay it back fast, I paid the balance all the way down to 2K by next cycle.

The next day I ask for a CLI and I get 2 K more making my limit 12K. The very next day I ask for another Balance transfer and take another 9K. So now I owe 11k on a 12k limit. Again, I pay back by next cycle this time leaving a 3 k balance. Next day I ask for another CLI, they gave me another 2k so now my Credit limit is 14K and I owe 3K on the card.

I tell this story for two reasons, One to say Discover is the easiest to get CLI FOR ME. Heck, Cap one gave me 1K after having the same CL for years using it almost to the full limit, paying it off, having different balances not paying it all off, paying to zero, etc etc. Every combination of things to try to get a CLI. Finally they offer 1K so in the end I take it(that is another story) and know it will be 6 months to possibly get another.

Second, my question:

Anyone have any insight on to how many times I can ask for these balance transfers to checking in a row without raising some kind of red flag or the transfer being denied?

I was going to ask for another 9k today and thought maybe I should look into it. I may pay another 1k to 2K before I ask again simply so it shows I am making ground on reducing the balance and not having progressively higher balances every time I ask for BT.

The reason I ask for these BT to Checking was never to get a CLI, it was just a byproduct of paying it back soon, I think.

Rebuild2019 · ‎02-08-2021

I don’t know how many times you can do this without raising a red flag. I really want to say I was wondering myself as I read your post. I don’t quite understand DISCO. They are kinda hard to figure out. I’m going to follow someone may know the answer.

Remedios · ‎02-08-2021

@Mland-EC wrote:
First, my Discover Limit was 3K about 7 months ago, today it is 14K. They gave me an auto one day. I wake up and have an 8K limit(5 k increase). Then I ask 45 days later ask for an increase and they approve me another 2k now I am at a 10K limit. So few months go by and I am in Dec.

I did a balance transfer to checking in Dec 2020 for 9K and that time as I said my limit was 10K. I had a 450.00 used on the card when asked so I owed very near my entire limit after that BT.

I chose the no fee 3%(some months it's 4%) because I knew I was going to pay it back fast. Well I did pay it back fast, I paid the balance all the way down to 2K by next cycle.

The next day I ask for a CLI and I get 2 K more making my limit 12K. The very next day I ask for another Balance transfer and take another 9K. So now I owe 11k on a 12k limit. Again, I pay back by next cycle this time leaving a 3 k balance. Next day I ask for another CLI, they gave me another 2k so now my Credit limit is 14K and I owe 3K on the card.

I tell this story for two reasons, One to say Discover is the easiest to get CLI FOR ME. Heck, Cap one gave me 1K after having the same CL for years using it almost to the full limit, paying it off, having different balances not paying it all off, paying to zero, etc etc. Every combination of things to try to get a CLI. Finally they offer 1K so in the end I take it(that is another story) and know it will be 6 months to possibly get another.

Second, my question:

Anyone have any insight on to how many times I can ask for these balance transfers to checking in a row without raising some kind of red flag or the transfer being denied?

I was going to ask for another 9k today and thought maybe I should look into it. I may pay another 1k to 2K before I ask again simply so it shows I am making ground on reducing the balance and not having progressively higher balances every time I ask for BT.

The reason I ask for these BT to Checking was never to get a CLI, it was just a byproduct of paying it back soon, I think.

Please help me understand...are you doing BTs and paying BT fees on very large amounts just to get a CLI?

fiddycal · ‎02-08-2021

Congrats on the CLIs! I can't answer for certain, but I would say the worst that would probably happen is that they would stop offering you balance transfers for a while. That's what happened to me when I was using Disco BTs heavily, but I also was not paying them down nearly as quickly as you are. I can't imagine them denying a transfer that they have already offered to you just because you are transferring it to your checking account though since that is a legitimate option that they promote.

Rebuild2019 · ‎02-08-2021

I think the worst that could happen is DISCO requests the 4506-T tax form. https://ficoforums.myfico.com/t5/Credit-Card-Applications/DISCOVER-FORM-4506-T/m-p/5645421#M232780

Mland-EC · ‎02-08-2021

First there is no fee it's FREE. No fee at all unless you choose the 0% offer

I get a choice of a 0% for 12 months with a 3% upfront fee or 15 months at 3 to 4.99% the amount changes depending on month they offer and with NO FEE AT All, zero. There is no world for me where I can not pay the balance to zero in 15 months.

At least those are my offers. And as I said I never did this for a CLI, the CLI I think was just a by product of paying it back fast.

Anyhow, I did the BT because my income has been all in or nothing since Covid. So I take the large Balance transfer and use that money to pay off all my bills. If I get paid big as I have the last few months I pay it all back or most all of it. If I don't get paid much or at all, which has happend a few months during Covid(but luckily not since I did these BT"S) the worst thing that happens is I have a hi ratio on the Discover card. BUT, then I am only left with the small 3 to 4.99% interest or zero interest with the 3% fee . I have so far chosen the small interst rate with no fee becasue I know I will be paying off fast. In any case any of these options smashes my lowest card rate of 14.5% with AMEX, especially if I ever have to go to 2 months or more or worst the full 12 to 15 months. If I can no pay it wihtin the first cycle worst case all my cards are at zero and one is near tapped(this Discover) with the small interest rate.

Mland-EC · ‎02-08-2021

I often wonder about the 4506-T reuest. If it's for a CLI, Big deal. I can give the 4506 or not. If they want cancel my card without the info, which is unlikely, I would just send the 4506 in for sure and see what happened. Not sending it in gets a person nowhere but a canceled card in this case.

MY question for those in the know is this:

Since I use available income, which is described right in Discover terms, my taxes are not going to match exactly may be far off.

How do they handle this?

For example say a couple files separately. The husband's income can used as a basis for the credit card, I even asked them to clarify that. They said yes even my adult kids income income if they live in my home and I have access to thier money is available to me as stated income. I can use that money. So say I make 120K and I put down 190K on the Discover form, CLI or app , but say 70 K is the Spouses or adult child's on seprate taxes. Would they cancel the card over that on e the 4506 comes back?

Just wondering if the 4506_T is more to prove we actually work, have a constant job and that the number is not super far fetched saying I make 190 K and my return shows 50K. But even in that case , what if my daughter made 140 K, lived with me and we had joint checking account, I had access to her money etc. I am following their rules, but my income would be far short of what I put down.

FinStar · ‎02-08-2021

From the Discover 4506T data points, if reported income doesn't match, account gets closed. So far, out of the plethora of closures, only 1 member has reported their success in account reinstatement after providing supplemental, verifiable income information.

Remedios · ‎02-08-2021

@Mland-EC wrote:
I often wonder about the 4506-T reuest. If it's for a CLI, Big deal. I can give the 4506 or not. If they want cancel my card without the info, which is unlikely, I would just send the 4506 in for sure and see what happened. Not sending it in gets a person nowhere but a canceled card in this case.

MY question for those in the know is this:

Since I use available income, which is described right in Discover terms, my taxes are not going to match exactly may be far off.

How do they handle this?

For example say a couple files separately. The husband's income can used as a basis for the credit card, I even asked them to clarify that. They said yes even my adult kids income income if they live in my home and I have access to thier money is available to me as stated income. I can use that money. So say I make 120K and I put down 190K on the Discover form, CLI or app , but say 70 K is the Spouses or adult child's on seprate taxes. Would they cancel the card over that on e the 4506 comes back?

Just wondering if the 4506_T is more to prove we actually work, have a constant job and that the number is not super far fetched saying I make 190 K and my return shows 50K. But even in that case , what if my daughter made 140 K, lived with me and we had joint checking account, I had access to her money etc. I am following their rules, but my income would be far short of what I put down.

Discover will only entertain what can be proved via tax returns, and it's not done to verify employment, it is done to verify income.

There were a few exceptions where they accepted pay stubs during the time EQ had a backlog, but they haven't done that since.

EX offers Income Insight, which uses "estimated" income. Do not let the word estimate trick you, it's unbelievably accurate.

TU also offers Income and Employment Verification without the need for interaction with customer.

If you cannot prove it, don't put it.

Mland-EC · ‎02-08-2021

Well that is my point, we can prove it, but the 4506 is not the end all in the proof.

If the 4506 is the end all and only proof Discover will take they are not following what the actual application they give states, what the CLI form asks for ie child support and other, which they know are NOT on a tax form.

A credit card company only needs follow this, of course they can use their own rules that are more strict, but they legally have to take the spouse or partners income inot account:

If you’re over 21, you can count any sources of income to which you have “reasonable expectation of access,” including:

Part-time or full-time income
Alimony or child support
Gifts or trust fund payouts
Social Security payments or pensions
Retirement fund payments
Investment income

If you live with a partner or spouse, you can also count his or her income toward your “household income,” thanks to a Consumer Financial Protection Bureau (CFPB) amendment in 2012.

Some of these things are NOT ON a tax return, especially if you file separately. EVERY card can look at it different of course, but for them to look at a 4506 and then not look at the spouse income is ludicrous ptnally illegal on their part. So for those CC companies that ask for the 4506 and then take the card away, I say no big deal not dealing with them. You did nothing wrong if you stated your "reasonable accessable income", but it 's not all on your tax return. It is not the income they asked for at the start of the app. I never had a credit card app I can remember that stated please only state income shown on your tax return. If Credit cards did this I am betting there would be far less confusion and far less time they need follow up and ask for the 4506..

I will do as I always have done, this being my 40th year with a credit card, put down my verifiable Income and not just what is on my tax returns thatwoul show up on a 4506. If they take the card from me becaue of that great, they should of asked for income only shown on my tax return. Some other CC company can get my interest.

I am betting there is more to people being asked for these 4506 and then the card taken away. I had to give a 4506 to AMEX once in 2018 becasue of an 8000.00 purchase. At that time I didn't know about credit gardening, I thought the 4506 was just to verify I worked. It never occurred to me they even looked at the exact amount. One day I found my card locked, my interest rate raised to 25%! and them asking for a 4506, I was a bit miffed. I sent the 4506 in, awhile later, maybe a month, they turned the card on, raised the limit by 5K and lowered the interest rate to 14.9%. I can assure everyone my Taxes didn't mirror what I had on the application. I am betting it was 60K difference at that time. They never asked for anything else. I kept my mouth shut. Only recently after being on the forum the last 6monthsI thought maybe I dodged a bullet.