Why is a FR so bad?

[jake619]

If you're not lying about income what's the big deal?

[sccredit]

Completely inconvenient. 

[bs6054]

A full FR (as compared to one when asking for a CLI when over $25K) is bad in the sense:

1) Your accounts are frozen during the review

2) A number of people (not all) have reported a very negative attitude from those conducting the review, guilty till proved otherwise

3) The end point can be reduction in CL and/or closure if they feel the circumstances justify it.  So you can be truthful at the time of application, but things have changed (or Amex's view of risk changes) there is still a bad outcome.

Now 1 and 3 are certainly justifed from Amex's viewpoint.  But that is why it is bad!

[SnackTrader]

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@jake619 wrote:
If you're not lying about income what's the big deal?

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Nothing, honestly. You're going to provide financial documentation for a mortgage, I don't see why it should happen for credit cards too. But some people have much more complicated finances than me (self-employed, multiple income streams, etc.)

However, if your account is shut down until you can pass the FR, then it becomes a big hassle for those using products frequently. It may block pending transactions or cause the card to be denied. Overall, it sounds much like a colonoscopy, unpleasant at the time, but not a big deal in the long run as long as nothing is found. 

[CreditCrusader]

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@jake619 wrote:
If you're not lying about income what's the big deal?

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I don't care who takes offense, I'll come out and say it: 

I believe that 95% of FR recipients who dread FRs feel that way because they fudged their application info in some form or another or they reported income that is not accurate as of the FR date. Perhaps 5% dread the inconvenience, but they are probably in the minority of that group. 

Edited to add: to answer your question, FRs aren't that bad. They represent a lender exercising responsibility when lending...something they should be applauded for.

[kevinjjc]

At the very least, it would be such a hassle to go through it.

[sccredit]

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@CreditCrusader wrote:

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@jake619 wrote:
If you're not lying about income what's the big deal?

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I don't care who takes offense, I'll come out and say it: 

I believe that 95% of FR recipients who dread FRs because they fudged their application info in some form or another. Perhaps 5% dread the inconvenience, but they are probably in the minority of that group. 

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I completely disagree.  I believe most people fear FR because the timing is normally terrible.  I was traveling with friends 6 hours away from home when they decided to start mine.  Horribly embarrassing when paying for a meal and your card is declined.  If they want you to prove your assets and income they should do so BEFORE issuing a card, just like a mortgage is done.

[jake619]

I'd be ok with that. At least you'd know where you stand with the creditor.

[bs6054]

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@SnackTrader wrote:

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@jake619 wrote:
If you're not lying about income what's the big deal?

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Nothing, honestly. You're going to provide financial documentation for a mortgage, I don't see why it should happen for credit cards too. But some people have much more complicated finances than me (self-employed, multiple income streams, etc.)

However, if your account is shut down until you can pass the FR, then it becomes a big hassle for those using products frequently. It may block pending transactions or cause the card to be denied. Overall, it sounds much like a colonoscopy, unpleasant at the time, but not a big deal in the long run as long as nothing is found. 

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And in many cases there will be accounts that auto-charge to the Amex account, and these will be denied, generating late/penalty fees with these other vendors.

Inconvenience can be inconvenient!   There are reports here of people who got an FR while abroad, and need to have sufficient limits left on other credit cards to pay hotels and flights etc.  Plus AMEX usually demands docs on a very tight schedule, hard when you are not at home.

Colonoscopy is one example.   Two more are IRS full audit, and a police interrogation.   At the end, even if nothing is found, not exactly an experience to shrug off!

[CreditCrusader]

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@sccredit wrote:

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@CreditCrusader wrote:

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@jake619 wrote:
If you're not lying about income what's the big deal?

---

I don't care who takes offense, I'll come out and say it: 

I believe that 95% of FR recipients who dread FRs because they fudged their application info in some form or another. Perhaps 5% dread the inconvenience, but they are probably in the minority of that group. 

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I completely disagree.  I believe most people fear FR because the timing is normally terrible.  I was traveling with friends 6 hours away from home when they decided to start mine.  Horribly embarrassing when paying for a meal and your card is declined.  If they want you to prove your assets and income they should do so BEFORE issuing a card, just like a mortgage is done.

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Yeah, here's the thing: the lender sets the rules with regards to what is or is not acceptable when issuing or continuing extensions of credit. It never ceases to amaze me how many know and understand how stIngy and overbearing Amex is...including FRs...yet are suddenly outraged at the "inconvenience" of having to prove credit worthiness on a continuing basis.

Many have said it...and it's a good message: if you don't like the way Amex does business, move on to another card. As for the reasons for fearing FR, you may disagree, but I urge you to have a look at a vast majority of the Amex FR threads. You will see an abundance of posts about fudged info, changing income, etc. as motives behind those Fears. As I wrote, it's not 100% of those folks, but I'd bet it's a vast majority.