Ouch, Discover!

[BlueNightStar]

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@SCoach wrote:

I think a lot of this has to do with the credit card company.

Discover cards seem to be aimed at mid-tier credit people who are likely to carry a balance, maybe charge too much, and don't pay off the cards every month.  Their model for highest profitability seems to NEED the cardholder to carry balances.  On the other hand AmEx tends to be targeted more toward those who will treat the cards like debit cards, pay them off very quickly and AmEx seems to be most happy when people do pay them off and not carry a balance.  AmEx is relying on swipe fees for profitability, so carrying a balance is unimportant to them. 

It would seem in the grand scheme, folks who frequent sites such as this have FAR more credit knowledge than the average Joe.  The average Joe gets targeted offers in the mail for someone with income like his, credit scoring like his, spend patterns like his, etc.  The company knows that Joe isn't likely to pay off the card every month.  Joe is happy someone extended him $2500 of credit, and the company is happy earning interest off Joe.  

Along comes Mr. Savvy, gets a card for the reward points, doesn't fit anything LIKE the common profile of a carrier of that card, and just does everything "wrong".  Calling for CLI's, paying in full, doing BT's and paying it to zero just before the cut off.  The company's worst nightmare.  And Mr. Savvy get's incensed when the company won't "work with him".  So I guess the way to make this work is to either get cards that work with how you spend your money and pay your bills, or learn the game of the credit card you have and play it the way they want it played.

Just my thoughts on the matter, and hopefully I've not offended anyone with my remarks.

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I tend to agree with you but think that Discover does not necessarily need someone to carry a balance and pay interest. I think they are trying to also lure the heavy user to earn them swipe fees, hence the recent approvals of higher CLs. It makes sense to mitigate the risk of someone who doesn't PIF and carries a balance for a long time with the possibility of getting in over their head and being unable to pay. Outliers on either side of the spectrum (can't pay more than minimum on the one hand and only using for 5% CB categories on the other) are probably what they try to discourage.

[Open123]

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@BlueNightStar wrote:

I tend to agree with you but think that Discover does not necessarily need someone to carry a balance and pay interest. I think they are trying to also lure the heavy user to earn them swipe fees, hence the recent approvals of higher CLs. 

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+1

I sense over the past several years, they've been trying to target and go after some of the Amex users.  Their add campaign of "We want to be your Main Card," is most assuredly a campaign geared closer towards the spendcentric model rather than the interest bearing one.  

I assume, this is why they've come up with the IT and offering 1% on all spend from day one as opposed to the More's 25 bps for the initial $3,000.

[SCoach]

I think these are very good points.  Could it be that Discover is trying to positon itself a bit differently?  You'll also have to forgive me when it comes to my comments about AmEx.  I tend not to think of the revolvers at AmEx and only the charge cards as that is what I've been familiar with over the years.  

I do think the comment about Discover not really courting the outliers on either extreme is on point.  

[Candice]

Hi guys,

This is some great info. I have a Discover More card w/ a measly $500 CL that was just reinstated. I'm glad it was reinstated though because it is the best card I've got right now. I want it to grow with me. 

Also, I used to work for Discover in their Collections department (LOL...a job is a job, right?) - but I remember in training that they talked about lot how Discover makes money...it's all about the interest...etc etc. So to those who have said Discover likes people to carry a balance, I can certainly see that being true. They never came out and said so during training but that is kind of the feeling I got. 

(random sidenote, but the people who actually WORK at Discover, at least in the call centers in the US...are generally very credit-ignorant, and often have poor credit and are usually in their early 20s. I know this because people would comment all the time how "funny" it was that they work in collections and have really bad credit. There was also a lot of turnover there.)

[Lambo23]

This is why I love this forum! So much great information!

[RyVision]

I've seen it said a few times on here that Discover likes usage, that could include carrying a balance on a regular basis.   I've carried a good size balance since I got mine due to the 0% for over a year, and they did give me a near 30% CLI after a request.  I refused a HP but they called me a few weeks later and offered most of my request with no pull.   6500 to 8500

[teachag89]

I am considering going for a Discover CLI but my card has pretty high utilization (37%, $1100 balance, $3000 limit).  It is the only card that I use often and also my only card that I do not PIF monthly.  Never been late, had the card for 3 years and received an automatic increase probably 2 years ago.  What are my chances of getting the CLI?  I don't want a hard pull if I don't have a shot.

[Rhaeny]

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@teachag89 wrote:

I am considering going for a Discover CLI but my card has pretty high utilization (37%, $1100 balance, $3000 limit).  It is the only card that I use often and also my only card that I do not PIF monthly.  Never been late, had the card for 3 years and received an automatic increase probably 2 years ago.  What are my chances of getting the CLI?  I don't want a hard pull if I don't have a shot.

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Check to see if you the luv button is available.  If so you can request a CLI and it will let you know whether or not an HP is required. If an HP is required then you just cancel it.

[sarkell]

Well I'm taking advantage of 0% right now my util will take a hit but oh well.  Trying to stay under 70% ill pay it down by 6 months.  Then hopefully get some kind of bump.

[dddewdrop]

    I really wish i had read this thread 3 days ago. i just let my first Discover statement post with a zero balance. I should have let it post with the 3 dollar balance that I have now. I know from this that at least with discover I need to keep a small balance. Discover didn't even generate a first statement for me because of the zero balance and I would be willing to bet it doesn't report to the CRAs. It really doesn't matter that much to me right now. I have so many new accounts and none are carrying a balance so adding discover doesn't help my score. It might even hurt it at this point. Anyway. I will let a small balance report. Interest is so small that it is moot with a small balance for a couple days. This is great information to know however as far as what they are looking for for CLIs. Sorry you got such a small one but at least we know now.