Citibank question

Discussion in 'Credit Talk' started by tom65432, Nov 15, 2001.

  1. tom65432

    tom65432 Well-Known Member

    I have six cards, all maxxed out. Total of $63,000 charged. This was due to two serious illnesses. All payments have been on time, always. I have not used the cards for about 6 months.

    Earlier this year, I got a double whammy. The CC companies figured out that I was living on my credit cards and a collection agency reported a paid collection on my reports (this was not mine but it was still reported). As a result, all of the credit card companies raised my interest rates to high rates. Citi was the worst, raising it to 24.99%. The paid collection was removed after I asked for validation. My credit reports are perfect, except for the high balances.

    I am working and able to pay these cards off eventually, but the interest rates are killing me. No one will give me credit now because of my situation.

    I am thinking of borrowing all of the $9,000 in my IRA to pay down the Citi card from $15,000 to about $6,000 in the hope of getting a lower interest rate. I can borrow it for 60 days without penalty. If they lowered my rate, I would BT from another card to Citi and then try to get a lower rate on the second card. Then I would repeat as much as possible before the end of the 60 days. I would then pay back the IRA with a BT.

    I have some worries. First, I worry that Citi will just lower my credit limit to $6,000, ruining my chances of paying back the IRA loan. Second, I worry that they will not give me a lower rate because all of the other five cards will still be maxxed out.

    I also have an MBNA card with a $20,000 limit, all used up. They wrote me and said that if I ever used my card, they would raise my rate to 23.99% so I do not want to try them. I have a Next card with a $4,000 limit, all used up. From what I have read, it is unlikely they would lower the interest rate. I have three Firstusa cards, $3,000, $9,000, and $13,000, all maxxed out. When my problems first hit, they reduced the available credit on one card from $8500 to $3000. I fear they would do the same thing again if I paid them anything substantial.

    Any comments? Will this work or is it too risky? If I do not pay back the IRA within 60 days, I will have penalties from the IRS for early withdrawals.
  2. leo728

    leo728 Well-Known Member

    Wow, didn't know the credit card issuers where so cold hearted.
  3. Bill B

    Bill B Well-Known Member

    I hope you make atleast 50k a year...try to get a amex loc i hear about they dont report..But what is your scores?
  4. DaveLV

    DaveLV Well-Known Member

    Forgive the melodramatic turn of phrase, but I wouldn't recommend that you mortgage your future to pay for the past. Taking the money out of your retirement account to pay down unsecured credit card debt doesn't seem to me to be a worthwhile plan. The dollar amount you want to withdraw doesn't make a significant dent in your total debt, and there is no way of knowing if it is even going to have the desired results.

    If you really think you are able to pay the IRA back the money within 60 days, why not pay the money to Citibank over the same period of time? Or if you want to make a single payment, save up for 60 days and make a single payment. Don't mess with your IRA.
  5. tom65432

    tom65432 Well-Known Member


    I quit trying to get any more credit when I maxxed out about April. I was just wasting inquiries. Have not applied for anything since April (turned down by Juniper), but I doubt anyone will extend me any more credit at this point. I am making over $100,000 year, so can pay this down, its just that interest alone is running me about $1000 a month. My scores are 660 for EX and 725 for TU. Don't know my EQ.

    Dave: I guess I did not make myself clear. The plan is to use my IRA money to pay down my accounts in the hope they will lower my interest rate, and then to pay back the IRA loan from a cash advance on the credit card. The end result would be the same amount of debt, but hopefully, a lower interest rate. I can borrow my own money for 60 days. I did it earlier this year when I needed to put food on the table. Paid it back withing the 60 days (just barely).

    Thanks for your comments (any more?)
  6. kustomkat

    kustomkat Well-Known Member

    Why dont you try getting a Citi AA card.... Gold and silver..

    My friend who had all of his cards maxed out.. 97% usage got the silver for 9000 and the gold for 12000
    he had a maxed out Plat Select at 24.99 cause of some late payments.. he combined all the cards with a new low intrest rate at 11.99 and 35000CL got a 1.9% BT for 9 months and started shifted his balances around... His creditxpert score went from 653 to 729 in two months and now he is going to apply for some other prime cards to do more balance transfers at low rates.....

    You may have to fudge a lil on your income cause of you high limits and high owing..

  7. tom65432

    tom65432 Well-Known Member


    What was his income when he got this? Like I said, my income is good.

    One concern. A few weeks ago, I tried for the online Citibank increase in credit card limit on my existing card. It denied me immediately. Said my balances were too high on existing cards. But, some people here have said that Citi does not like to increase balances but will issue a new card.

    I have had no inquiries on any report for 7 months. I know they pull TU which is my best. I guess I could try it. Worst that could happen is to waste an inquiry.
  8. sam

    sam Well-Known Member

    Apply for both the silver and gold AA at the same time. you'll either get both or none, and only one inquiriy...

    good luck
  9. kustomkat

    kustomkat Well-Known Member

    He actually didnt have any income because he just got laid off a few months back...
    Thats why He did.. so he could lower all his aprs so that he could manage his payments until he finds a new job..
    I believe he used 75000 though...

    You should fudge your income up a little though becuse your revolving debt is so high..

    I would use like 145,000 or so... that would keep your debt level under 50%..

    go here and apply for the silver card..

    immediately after being approved apply for the gold aa card

    you will 95% get an instant response..
    If you already have a citi card you are guarenteed to get these cards.. They are super easy to get.. My Gf got both cards 6000CL and 3500CL with sub 600 Fico scores...

    My friend had 3 30 day lates with Citi this year and still got the cards.. He had also just been denied for a line increase from that online request.....

    Try it...
    Seriously you have nothing to lose...

    It will increase your scores because you will have more credit available.. Plus allow you to BT funds around to help lower your APRs with your other creditors, and maybe even allow you to get some new credit...

  10. Dani

    Dani Well-Known Member


    I've been through this one myself, as well as, helping my mom reduce her credit cards - completely maxed out. Unfortunately, right now the credit card companies have you where they want you. I learned this the hard way. No credit card company will offer you a card with the amount of debt you're carrying even with your great income. Two options: 1)take a personal loan from your local bank or credit union (I don't know if they will allow this with the debt being so high without wanting to secure something in its place) 2) if you own a home, refinance. I know this sounds awful because who wants to include $60000 + credit card debt in their mortgage payments for the next 15-30 years, but it will offer you a low interest rate and you can begin sending one large payment to one company. I only make this suggestion because your income is good and it's possible for you to pay down the debt quicker. Hope this helps.

  11. Bill B

    Bill B Well-Known Member

    Yes i would try the citi-bank thing..I was denied everywhere for credit and the guys told me about that and i got 11500 so it is worth a shot....
  12. Cadillac408

    Cadillac408 Well-Known Member

    I would first try the AMEX LOC and see if that pans out. I would also go the Citi AA route....what do you have to loose?

    Also, BE CAREFUL of FUSA! They will do EXACTLY what you mentioned. They did the same thing to me. They saw that I was in trouble and lowed my $10k limit to like $6k. At the time I had a balace close to $6k and I made a few purchases and it put me over the limit! Then the story continued on from there. FUSA has their game plan. THEY WILL LOWER YOUR LIMIT at first opportunity. If you pay that balance down, expect for your limit to be lowered almost immediately!

    Thanks for sharing your story. I know that may have been hard for you to admit that you are in a little bind, but we are all here to help eachother. Stay strong...
  13. DaveyBoy

    DaveyBoy Well-Known Member

    Don't want to deviate too much, but I tried the Citi AA silver/gold thing and denied w/ 550+ scores.

    just my experience
  14. tom65432

    tom65432 Well-Known Member

    I had not even considered applying for another Citi product after they turned me down a few weeks ago for a credit line increase. With my Tu score about 725, I should have some hope. Would it greatly improve my chances if I used my IRA loan to pay down the current Citi balance from $15,000 to $6,000 before I tried for the new cards? I want to maximize my chances of success because I am getting killed on the interest rate.

    If I do this, what are the chances of Citi lowering my interest rate to a more reasonable level? Or, giving me a BT rate?
  15. Geo

    Geo Well-Known Member

  16. tom65432

    tom65432 Well-Known Member

    OK. Two people have said to apply for the Amex LOC. I always thought Amex was only for those with superb credit. Is there any chance that I can qualify?

    Same question with Generations. Any chance I can qualify? I know they offer very generous credit limits when you do a BT.

    I know Generations does not report to the credit agencies. Is the Amex LOC the other one that does not report?
  17. Beaker

    Beaker Well-Known Member

    No, the AMEX LOC does not report. There are several people here who have one, including myself, and they didn't require perfect credit as far as I can tell.

    I applied for Generations with a FICO of 682 and was declined, but who knows? Length of time @ job and income were the primary factors, so with your income they may be more than happy to have you as a customer.

    Best of luck, whatever you decide. I'm doing the pay-down-the-debt thing too, so I know how much it sucks! But keep at it and you will be fine. :eek:)
  18. Saar

    Saar Banned

    1. If your credit reports are once again clean, then the next AR done by the creditors should get you your old APRs back within 0-4 months. Call all your creditors to see if this can be done sooner. Do it right now.

    2. Apply for an Amex LOC here:
    Chances are not that good, but they pull EXP and only put a soft INQ so you've got nothing to lose.

    3. Others w/ high debt ratios have previously been approved for Citi AA. Do try them:

    4. Have you tried a credit union LOC / loan?

    5. You can borrow some money (IRA or other), pay off/down the card w/ the earliest due date, and once the cycle closes, BT to the card w/ the second earliest due date. Repeat w/ the third, etc. Say you have 9K to pay. Within less than 2 months, your report would show as if you've paid $9K on EACH of your cards. That's because most lenders report your balance to the bureaus the way it is on the day your monthly cycle closes. The effect of the new fake ratio would only last for a short while, so you'd have to track your reports and apply for more credit as soon as your reports update (but before the following month's update)

    This would work even if you apply the strategy on only 1-2 cards. Do not BT to cards that carry a BT fee.

  19. Cadillac408

    Cadillac408 Well-Known Member

    Great advice Saar! :)
  20. sam

    sam Well-Known Member

    just dispute a few cards off as "not mine", quick and dirty lower your total balances :)

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