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Anybody else get an email about Paypal changing terms

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Re: PayPal Credit going to Synchrony Bank???

So I did a little digging, and learned that it probably is not helpful to read into the terminology of the emails that went out recently in regards to the credit reporting.

 

I found and read the updated Diners Club policy, which began reporting after that product's switch to Synchrony, and guess what it says in the Credit Reporting section:

 

"We may report information about your account to credit bureaus. Late payments, missed
payments or other defaults on your account may be reflected in your credit report."

 

I seems that this may just be Synchrony Bank's prefered phrasing for this, and that this hidden tradeline may be coming to an end. What confuses me is how the product will continue. How will CLIs work, and why would anyone want a no rewards account that needs to be maxed out to be used to its full potential? Maybe the risk outweighs the potential of losing all of the customers who have used it exclusively for the hidden TL.

Message 61 of 179
New Member

Re: PayPal Credit going to Synchrony Bank???


@OverBlue wrote:

So I did a little digging, and learned that it probably is not helpful to read into the terminology of the emails that went out recently in regards to the credit reporting.

 

I found and read the updated Diners Club policy, which began reporting after that product's switch to Synchrony, and guess what it says in the Credit Reporting section:

 

"We may report information about your account to credit bureaus. Late payments, missed
payments or other defaults on your account may be reflected in your credit report."

 

I seems that this may just be Synchrony Bank's prefered phrasing for this, and that this hidden tradeline may be coming to an end. What confuses me is how the product will continue. How will CLIs work, and why would anyone want a no rewards account that needs to be maxed out to be used to its full potential? Maybe the risk outweighs the potential of losing all of the customers who have used it exclusively for the hidden TL.


That's what I wondered too, and it would make sense based on what the CSA told me about only payments being reported, not balances or limits. That's apparently not legal based on the terms of the bureaus though. 

 

Regardless, I will PIF and close the account next month, I have no need for it without the benefit of using the hidden line and the 0% deals, and knowing I can never get a CLI without maxing out.

Message 62 of 179
Moderator

Re: PayPal Credit going to Synchrony Bank???


@OverBlue wrote:

Sosimilar I did a little digging, and learned that it probably is not helpful to read into the terminology of the emails that went out recently in regards to the credit reporting.

 

I found and read the updated Diners Club policy, which began reporting after that product's switch to Synchrony, and guess what it says in the Credit Reporting section:

 

"We may report information about your account to credit bureaus. Late payments, missed
payments or other defaults on your account may be reflected in your credit report."

 

I seems that this may just be Synchrony Bank's prefered phrasing for this, and that this hidden tradeline may be coming to an end. What confuses me is how the product will continue. How will CLIs work, and why would anyone want a no rewards account that needs to be maxed out to be used to its full potential? Maybe the risk outweighs the potential of losing all of the customers who have used it exclusively for the hidden TL.


@OverBlue, the bolded statement appears to contain some inaccuracies.  The US Diners Club CC portfolio never switched to SYNCB, it remained with the same bank (BMO Harris Bank) which had purchased the previous portfolio from Citibank.  Moreover, the CCA language or 'legalese'  (customized by each FI depending on the product type, features, etc.) tends to be very similar since it would need to adhere by regulatory compliance standards. 

Message 63 of 179
Regular Contributor

Re: PayPal Credit going to Synchrony Bank???


@OverBlue wrote:

So I did a little digging, and learned that it probably is not helpful to read into the terminology of the emails that went out recently in regards to the credit reporting.

 

I found and read the updated Diners Club policy, which began reporting after that product's switch to Synchrony, and guess what it says in the Credit Reporting section:

 

"We may report information about your account to credit bureaus. Late payments, missed
payments or other defaults on your account may be reflected in your credit report."

 

I seems that this may just be Synchrony Bank's prefered phrasing for this, and that this hidden tradeline may be coming to an end. What confuses me is how the product will continue. How will CLIs work, and why would anyone want a no rewards account that needs to be maxed out to be used to its full potential? Maybe the risk outweighs the potential of losing all of the customers who have used it exclusively for the hidden TL.


"MAY REPORT" is standard language in all credit agreements.  Check your other agreements.  Though it typically means, "WILL REPORT," creditors use "may" for legal reasons since "may" doesn't obligate them to report.  I think I or someone else already posted this about "may."

 

What do you mean by "a no rewards account that needs to be maxed out to be used to its full potential?"  Why must it be maxed out?

 

CLIs may work like it does for normal, routine credit cards.  We simply ask for a CLI.

 

Why are you assuming they will lose SO MUCH business after they begin reporting? You may have an exaggerated opinion of how many people ONLY use the account because it is hidden.  That's information we can't possibly know.  I would bet lots of folks also use it because of the 6 months/no interest.  Even with a new minimum low monthly payment, that feature cannot be had elsewhere.  As far as we know, Synchrony may have already done research/testing and determined that if any business is lost, it won't be so much so as to materially affect profits.  It's also possible that Synchrony is not much interested in consumers who only want the account because it doesn't report - even if it affects profits in the short term.  Every creditor runs their business differently.

Message 64 of 179
Member

Re: PayPal Credit going to Synchrony Bank???

That was my mistake on the Diner's Club Bank, I now see that it is in fact still a BMO Harris backed product. However, the fact that the explicit mention of derogatory reporting does not have any bearing on the totality of what is reported seems to still be accurate.

What I meant by "no rewards account that needs to be maxed out to be used to it's full potential" is based on the current PayPal Credit structure. It is not a rewards account. If I was comparing PayPal Credit, post-reporting era, to any CC with perks, I would see no reason to choose PPC over the product that offers substantial benefits for using it. For the "max out" statement, that is referring to the current CLI structure of PPC. You cannot apply for a CLI, but rather need to go over your limit with a purchase to get an increase. Therefore, when it starts reporting, if you want a CLI, you will need to max out the account first, and have it report unless you PIF, which would effectively make the 0% for 6 months irrelevant. I am sure that the structure of this system could change, but then it would be competing almost directly with the PayPal credit card. Probably not a huge concern to Synchrony, but true nonetheless.

Lastly, I don't think I ever assumed how much business PPC would lose with the shift to a non-hidden TL? I never claimed they would lose a tremendous amount of customers, only that they would likely lose most/all of the customers using it exclusively for the hidden TL feature. I agree with you, that they likely did research on this and found that the risk of having unreported trade lines out there is less ideal than the potential loss of some customers as a result of the new reporting. I don't think that there would be a catastrophic loss of customers, just that some would leave, provided that the hidden TL was the primary benefit of this product for them.
Message 65 of 179
Member

Question about planning for new account reporting

Hello everyone,

 

As many of you may have seen recently, it appears that PayPal Credit may start reporting to CRs later this year. I know nothing is certain yet, but I am currently planning financially for the upcomming months and could use some advice.

 

I used PayPal Credit semi recently for a large expense (about $4700) and took advantage of the 0% interest for 24 months offer. All is great. The issue is that with this account popping up on my CR in a few months, potentially as a new account, I am worried about what will happen to my scores.

 

Now, the issue I am having is that I will be moving around the time this would happen, which will be a major expense. I do not want to decrease my cash liquidity to pay PPC in full in the next month or two. At the same time, I am worried about what will become of my credit scores as this account hits my report. So my question to you is: Is it worth paying down the balance with a low interest loan and closing the PPC account before it reports, or will the new loan be just about as bad? I am more worried about how other creditors will react to seeing a massive balance pop up on a new revolving account than I am about the amount of interest that would be paid on the loan balance. 

 

However, if both situations end about the same in terms of score impact, perhaps there is no point to this, and I should just pay it through PPC as planned; after the move.

Message 66 of 179
New Visitor

Re: New Terms Letter from PayPal/Sync Possible CB Reporting?

Hoping to get this straight...

Syncrony bank may (or may not) soon begin to report our paypal credit BALANCES to the credit burearus?

If that's the case a lot of folks are screwed because as we all know that balance percentages play a huge role in credit scores.

I just happen to have over 5K balance. Oh well...

27% interest?

Wow, the greed of these CC companies is unphantomable.. ever since the 2008 crash...

they took things to a whole new level, rates went through the roof...record profits galore..really tough on those struggling.

(Mod cut, sorry not here - the 5 Things We Don't Talk About)

But I digress. : )

(been a paypal member since Elon Musk created it).

Hopefully cryptos will become viable someday, and banks will thankfully become a thing of the past.

99% are scams ATM but next fiat crashes a lot of people will be done with walstreet for good.

 

Message 67 of 179
Member

Impact of new credit line reporting with high balance?

Hello,

 

I currently have a hidden tradeline that is currently at 4700/7000 at 0% for the next year or so. As I will be moving soon, my plan was to keep as much cash as possible available and pay off this line early next year. However, it now seems that this line will start reporting later this year.

 

My fear is that a balance this high out of the blue will spook some other lenders, and lead to AA. I know this is just speculation/worrying, but I want to be prepared, so I have a few questions for anyone who is willing to give advice:

 

When hidden lines begin reporting, do they generally backdate, or report as a newly opened CL? I suspect that there will not be a straight answer to this, which leads me to ask:

 

Am I better off taking out a low-interest loan before this account hits my CR to pay it off and avoid a utilization spike, or will the new loan look just about as bad? I am not too concerned about the amount of interest paid on the loan if it will protect my scores/help avoid any AA (reading this forum gives me anxiety about AA!)

 

Any advice would be greatly appreciated!

Message 68 of 179
Moderator Emeritus

Re: Impact of new credit line reporting with high balance?

It will be a non-issue honestly. I have had 95% hanging out on a HELOC for a lot more money than that and your ratio isn’t that bad.

It should report from the date that the account was opened.

Out of curiosity what tradeline is this that is hidden currently and will start reporting?



        
Message 69 of 179
Member

Re: Impact of new credit line reporting with high balance?

Sorry about the delayed response, had a super busy past few days.

 

That is good to hear. I'll admit that I'm a little more concerned about the sudden 4700 (probably a bit less, but still) more than I am about the carried balance. I'm currently sitting at about 20% utilization of 50k in CLs, and always pay way over minimums, but this seems like is might flag something, especially considering how much it is compared to how much is reporting.

 

Anyway, the tradeline is PayPal Credit. I posted about it previously, but it got moved to, and lost in, the megathread on the new reporting policy. I tried to make sure it stayed independent this time, as I felt that this question will be more broadly applicable to users of this site, even if it is just in the context of a large purchase or something and not just a new TL reporting.

 

Thank you for your input though, it does help me relax a little. I always get anxiety about things like this, especially now that I am so close to having 0% util. reporting, down from around 65% a while back. I will still have 0% soon enough, but AA can't be much fun.

Message 70 of 179
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