Re: Things we remember...
Tim McDaniel
Default User <defaul...@yahoo.com> wrote:
>Dorothy J Heydt wrote:
>
>> Well, I've been reading articles indicating that some companies
>> will cancel your account if you pay it all off.
>
>There's been speculation about that. To date I've seen no indication
>that companies are doing it.
I don't have data, but during the depths of the credit crunch, I
wouldn't have been surprised.
A related problem:
When the credit crunch was hitting the US hardest (early 2008, I think
it was?), I found enough articles of people, usually small businesses,
getting hit in a different way. A typical article was a couple using
AmEx for a small business and getting a charge declined. They checked
and found that AmEx had cut their credit limit down to just above
their current balance. They paid down a lot of the remaining balance
to get some breathing room ... and AmEx cut their credit limit again
to just above the new balance.
(For another hit, there were also cases of credit-card issuers
suddenly upping the monthly minimum payment.)
>> Because it isn't bringing in as much money any more. And that
>> other companies will be reluctant to take you on, because if your
>> first card is cancelled it dings your credit rating.
>
>That doesn't hurt your credit, other than lowering your credit/debt
>ratio, which is high anyway.
Meaning credit_limit/debt ratio? Cutting the credit limit hammered
these people; they improved matters by paying down some debt, and then
got hammered again.
--
Tim McDaniel, tm...@panix.com
Default User
> In article <7lm65nF...@mid.individual.net>,
> Default User <defaul...@yahoo.com> wrote:
> > Dorothy J Heydt wrote:
> >
> >> Well, I've been reading articles indicating that some companies
> >> will cancel your account if you pay it all off.
> >
> > There's been speculation about that. To date I've seen no indication
> > that companies are doing it.
>
> I don't have data, but during the depths of the credit crunch, I
> wouldn't have been surprised.
As I said, I haven't heard of any real cases. Some of the other things
you mention, as well as hiking rates ahead of the legislation that will
control that has happened.
> >> Because it isn't bringing in as much money any more. And that
> >> other companies will be reluctant to take you on, because if your
> >> first card is cancelled it dings your credit rating.
> >
> > That doesn't hurt your credit, other than lowering your credit/debt
> > ratio, which is high anyway.
>
> Meaning credit_limit/debt ratio? Cutting the credit limit hammered
> these people; they improved matters by paying down some debt, and then
> got hammered again.
FICO looks at your total available credit and how much you are using.
If you only have one card, then having the limit changed would hurt.
That's why you never close a card unless they add a fee or something.
Closing a card doesn't matter much if you pay your balances each month,
as you never really get close to total limit.
Brian
--
Day 278 of the "no grouchy usenet posts" project
erilar
"Default User" <defaul...@yahoo.com> wrote:
> FICO looks at your total available credit and how much you are using.
In that case, mine will stay valid forever, because I charge such large
amounts at times that they've raised my credit limit to tempt me to NOT
pay it off each month 8-)
--
Erilar, biblioholic
bib-li-o-hol-ism [<Gr biblion] n. [BIBLIO + HOLISM] books, of books:
habitual longing to purchase, read, store, admire, and consume books in excess.