Never threaten Bankruptcy

Discussion in 'Credit Talk' started by Hal, Aug 30, 2001.

  1. Hal

    Hal Well-Known Member

    I was discussing credit card companies with a friend who has worked in the industry for about 10 years.
    She informed me it is becoming a norm in their industry to "flag" an account as a "Bad Risk" if they receive a call from a customer, threatening bankruptcy if they don't lower APR etc. This may be shared with other companies that you apply to.

    I did not know - despite the competitive nature of the industry, they regularly share information with other credit card companies upon request. If you apply for a new card and they note on your credit report you have ABC Visa - they will randomly contact ABC Visa to inquire on your account history in regard to timeliness of payments, average balance vs limit etc.

    I asked her how they feel this is allowed - she said that most credit card applications state that you agree to let them share information with other creditors - this is probably true but I don't recall seeing it on an app.
  2. bbauer

    bbauer Banned


    I have a question, point, or whatever one wishes to call it about your post.

    I don't want to make it a public post because I don't want to be seen as disputing or disagreeing with your post which I'm really not.

    I tried to email you, but it isn't turned on.

    Would you please email me so I can ask my question in private?
  3. MartysGirl

    MartysGirl Well-Known Member

    Personally... This sounds like a Civil Suit WAITING to happen...!! And if this is really going on... I can't wait to see the Civil Suit Happen...!!!!!

    This is awful... What..If someone flags you by mistake.... And YOU/ANYONE/ME are denied by another company b/c of this. Also... Did you ask your friend the excuse they use when they send your denial letter...??? I would love to hear what they have to say about this? Or do they just "supposedly lie" about this? I can't imagine how the denial letter would explain why you are denied...????

    THIS IS FUNNY....Sorry to inform you but.... ABC Visa said "YOU Are A HIGH RISK"!!

    This sounds like a bunch of Bunk to me.....!!!!!!!!!!!!
  4. Hal

    Hal Well-Known Member

    I think they get away with it, unless you "opt out" by inserting phrases as the one below in their "terms and conditions" on the application:

    I authorize ABC VISA to share with others, to the extent permitted by law, such information and its credit experience with me. In addition, I may as a Customer later indicate a preference to exempt my account from some of the information-sharing with other companies ("opt-out").
  5. Maer

    Maer Well-Known Member

    I'm not sure how true this is but.....When I went through my b/k a few years ago, my lawyer told me that Citibank is know for being really nasty and doing stuff like this. When you include them, they will notify your other creditors that are not included in your b/k (because of 0 balances) that you are filing. Supposedly so that you will not have any credit coming out of your b/k.
    Right after b/k I tried to use my Circuit City card (which was NOT included) and it was denied. When I called the number they said they had closed the account because they were notified that I had filed b/k. They did not say who notified them.
  6. keepmine

    keepmine Well-Known Member

    Rule #1. Never do anything to make a creditor nervous.
  7. Shirley

    Shirley Well-Known Member

    Wow, thanks for that info Maer.

    My husband filed BK in '93 with a couple of Citibank accounts included. He didn't include one card, an MBNA Visa. Months later when he tired to use it, he too was denied and got the same info you did when he called. I believe MBNA sent him a letter to that effect.

    Now we know who tipped them...
  8. keepmine

    keepmine Well-Known Member

    I dunno about this. CC companies sweep account periodically looking for bk and late pays. Chances are, they would havefound it anyway.
  9. mj

    mj Well-Known Member

    If Citibank called your other creditors to tell them you filed BK, that's pretty much a violation of the FCRA (Circuit City isn't a credit bureau by FCRA standards).

    As noted by another poster, Circuit City (and most creditors) so "soft" inquiries semi-annually, quarterly, or monthly, and would find out about the BK that way.

    They also will find out who you're paying a little bit to, who you're paying a lot to, and who you're charging up with. Then you get either increased APRs or balance transfer offers, depending on if they're nervous you'll default or bolt.

    Lovely place we're all in now, isn't it? It's report cards and "SAT Scores" all over again -- every month for the rest of our lives!
  10. keepmine

    keepmine Well-Known Member

    You're though about the importance of credit scores is so true.
    The subprime market is about to get smaller and smaller. Providian is proving that it is a tough place to make money. Citicorp is completely exiting the subprime arena and Orchard Bank is about to lose a huge lawsuit in La. over whether they qualify as a bank and can export those high interest rates.
    I believe the major credit card players will fight it out over prime customers and leave a very few players in the subprime market to charge whatever the market will bear. It is time to get credit cleaned up and stay clean because it'll only get tougher to get reasonable financing rates on unsecured debt.
  11. lbrown59

    lbrown59 Well-Known Member


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