Discussion in 'Credit Talk' started by mh1757, Aug 14, 2003.

  1. mh1757

    mh1757 Well-Known Member

    I was approved for a CC card w/a $6000 credit limit. They pulled TU which does not have any negatives. Question: When they do an account review on Experian and see my BK 13 (drops off in early 2004) and a Capital 1 R5 which is scheduled to turn positive in early 2005, will they reprice me at an higher interest rate and drop my credit limit? BTW, I do have 10 positive tradelines with a two year paying history.
  2. RichGuy

    RichGuy Well-Known Member

    Your description could fit several banks, including Chase.

    If you're talking about Chase, it will take them about a year to pull Experian for an account review. Then, if it has any negative info, they will reprice you. Experian doesn't have to be worse than TU; it just has to have one derogatory item.

    It's a strange way to look at otherwise satisfactory accounts, but Chase really is trying to milk every account it can plausibly justify milking. Some people assume every bank is like that, but Chase actually confirms the stereotype.

    After JP Morgan paid an outrageous price for Chase (or was it the other way around?) they developed inflated expectations about the profitability of the credit card division. Since then, the slightest fluctuation in default rates is sufficient to cause panic, overreaction, and arbitrary repricing.

    If Chase at its best wasn't very good, I wouldn't tolerate their financial mood swings for a minute.

    GEORGE Well-Known Member

  4. RichGuy

    RichGuy Well-Known Member


    That was a cryptic message with little information to confirm your meaning.

    Do you mean one Chase credit card? Actually, until I pay off my balance, I'm stuck with a Chase account.

    BTW, my rate was at 16.24%, just like yours. I think they just lowered it to 15.99%. For that I can thank Alan Greenspan and possibly W, but not Chase.

    GEORGE Well-Known Member

    Re: Re: Repricing?

    It "WAS" under 12% got "JACKED" to 16.24% NO BADIES ANY CRA!!! (One internal FALSE 30 DAY LATE)


    I have told this story many times here...I thought everybody knew about CHASE "JACKAGE"
  6. RichGuy

    RichGuy Well-Known Member


    I know very well about Chase's "jacking" tactics. I have my own story about that, and I've been interested in yours as well.

    However, no amount of knowledge about Chase was sufficient to interpret "HAVE ONE" and "HAVE ZERO."
    You have your own private language.
  7. RichGuy

    RichGuy Well-Known Member


    Okay, you mean zero derogatories. I guess they can look at anything as a "risk," not just formally derogatory items.

    Once I translated it, without much help, your comment was interesting. Thank you.
  8. mh1757

    mh1757 Well-Known Member

    Thanks for the response. The credit card is Chase.

    GEORGE Well-Known Member

    Re: Re: Repricing?

    t just has to have one derogatory item.
  10. GEORGE

    GEORGE Well-Known Member

    Re: Re: Repricing?

  11. mh1757

    mh1757 Well-Known Member

    I am wondering is Chase doing this intentionally to justify jacking up rates? They must know that all credit reports can not be consistent across the board. Why not pull 2 or all 3 to be sure before issuing the card.
  12. sirrowan

    sirrowan Well-Known Member

    A "Capital 1 R5 which is scheduled to turn positive in early 2005? Are you currently paying 120+ days past due?
  13. lbrown59

    lbrown59 Well-Known Member

    Question: When they do an account review on Experian and see my BK 13 (drops off in early 2004) and a Capital 1 R5 which is scheduled to turn positive in early 2005, will they reprice me at an higher interest rate and drop my credit limit? BTW, I do have 10 positive tradelines with a two year paying history.
    Probably as that's what Fico is all about!

    THE END ** *** ** LB 59
  14. mh1757

    mh1757 Well-Known Member

    Question: Are you currently paying 120+ days past due?

    Answer: No. Account shows as inactive/current with a zero balance.
  15. RichGuy

    RichGuy Well-Known Member

    Not the end yet; repricing is an ongoing issue.

    I have two theories about Chase:

    (1) They have an internal conflict between the marketing people and the risk-management people.
    Some want to issue more cards; others want to raise rates and close accounts. They divide the turf. One group gets to use TU to grant you credit; the other gets to use Experian to harass you.

    (2) They have found, or think they will find, that there is less customer resisitance once the customers are committed to their accounts. You might close a new account at the "high-jack" rate, but after a year you have a balance, or need the account history, or whatever. You're commited. They may also find that people who get repriced feel more guilty tha new customers. They may feel it's really their fault.
  16. Hedwig

    Hedwig Well-Known Member

    I'll start by saying that I've closed all my Chase accounts, and consider it good riddance. But if I did have one, I believe that I'd have to make sure it was one that got paid off every month and never even took a low rate balance transfer, since it's so easy to get jacked with them. That's why I canceled them. I even had an unsecured line of credit that I canceled, not because they jacked the rates, but they started charging fees on it!
  17. RichGuy

    RichGuy Well-Known Member

    I paid (3% fee) for a small 9.9% balance transfer to my Chase card. Then after 3 months or so, they just took it off the statement and charged the purchase rate for everything. That was my first clue.

    Then they repriced me twice. I wanted to close the account after the second incident, but it was "only" repriced to 16.24% and I needed to keep most of my older cards.

    The Experian report is clean now, but they could still reprice me with no derogs a la GEORGE. But all they wanted out of GEORGE was 16.24%, and they already got that out of me. So I don't know what they'll do.

    If they refuse to deal with me once my credit looks better, or if they ever go back on a deal again, then it'll be good riddance for me too.

    From what I've read, J.P. Morgan Sr. drove a hard bargain, but he kept a deal once he made it. He must be rolling over in his marble tomb right now. Salmon P. Chase probably isn't too happy either.
  18. mh1757

    mh1757 Well-Known Member

    Banks can now check on customers daily
    Credit bureaus offer tracking for `triggers' like loans, bankruptcy
    Wall Street Journal

    Your bank is stalking you.

    For years, credit-card issuers have quietly checked the credit reports of their customers from time to time to make sure they hadn't run up huge new debts elsewhere. If they found black marks, they would often make those customers pay a higher interest rate or lower their credit limit.

    Now, in a development that significantly steps up the surveillance, banks have the ability to check up on customers on a daily basis. The three big credit bureaus -- Experian Information Solutions Inc., Marmon Group's TransUnion LLC and Equifax Inc. -- are touting new technology that can recognize so-called triggers: signs that tip off card issuers that it is time to rein in a risky customer. If a customer declares bankruptcy today, a card issuer can find out about it the day after and cut off charging privileges the day after that.

    Lenders are using the tools to do more than just the traditional review of risk factors. They also are literally watching their customers shop. Experian, for example, is selling banks a daily peek at current customers' credit reports. That way, banks can see if customers are looking to refinance their mortgage with a rival.

    Bank One Corp. is using triggers to identify home-equity-loan holders who are shopping around. If they discover another lender has pulled a credit report on a customer -- a sign the customer is looking for a new loan -- Bank One can swoop in and make its own cut-rate offer to keep the customer from bolting. In May, Charlotte-based Bank of America Corp. tested the triggers in its mortgage business, though the bank says it isn't using them now.

    It is perfectly legal to track customers' credit histories and adjust the terms of their loans accordingly. Until recently, however, it was too expensive or complicated to get this information -- whether it be credit blemishes or loan applications -- on a daily basis. But new, more powerful computers and better databases have changed that.

    In the past, Experian, a unit of Britain's GUS PLC, delivered gigantic data dumps to financial clients every month or two. Now, it can provide them with daily updates on specific customers. "Instead of (businesses) saying to us, `Here's 20 million names, please pull all the data on them,' they're saying `Here's 20 million names, and when something changes, tell us about it,' " says Richard Lombardi, Experian's director of marketing, portfolio solutions.

    The kind of information tracked includes updates on bankruptcy filings or judgments against a cardholder, information on late payments to other billers, plus other data on how much credit they are using. In addition, when consumers apply for new credit cards, a notice of each application appears on their credit report.

    The more frequent surveillance may raise privacy concerns for some consumers, but it won't have an effect on the quality of their credit. While applying for lots of loans and credit cards can lower one's credit score, banks can't damage your report simply by checking it.

    J.P. Morgan Chase & Co. notifies customers whose credit-card terms change for the worse and provides an explanation upon request. It also tells cardholders they can get a free copy of their credit report because of the repricing.

    Ed Mierzwinski of U.S. Public Interest Research Group, a consumer-advocacy group, warns consumers to beware of lowball counteroffers from their banks. He says they may get better rates by shopping around. Bank One disputes this, noting that it offers special rates not available in its branches to keep good customers.

    To avoid an interest-rate hike on your credit card, pay all your bills on time. Maxing out your credit cards can be a bad sign, too, as is applying for a bunch of new cards, according to Ron Robine, an official with Bank One. Warning Signs

    Thanks to new technology, credit-card issuers can check your credit report every day and immediately raise the rate. Some things they look for:

    â?¢ If you've recently taken out a number of loans or have applied for several new credit cards, banks worry about your potential to run up lots of debt quickly.

    â?¢ Falling behind on insurance premiums or other bills can also hurt you with your bank.

    â?¢ Lenders don't like it when you max out all your credit cards
  19. RichGuy

    RichGuy Well-Known Member

    That's an interesting but scary post, mh1757.

    I think that if inquiries are counted at all, they should in most cases NOT list the name of the lender.

    For me recently, inquiries have been a powerful trigger. Banks may see them as representing additional risk, but I think the banks are also being vindictive. They resent your violating their exclusive right to offer you credit by seeking out additional credit partners. Typical junior-high mentality, now almost universal in American banks.
  20. sirrowan

    sirrowan Well-Known Member

    Re: Re: Repricing?

    The reason I ask about the R5 is:

    If this account was charged off and they (Cap 1) changed it to R5, you got screwed. R5 tanks your score.

    R9's will age, so you could have an R9 that is 6 years old and is hardly used to calculate your FICO.

    An R5, on the other hand, says that you are CURRENTLY 120+ days past due.

    This is how it was explained to me months ago by an Equifax Rep. (I think it was Equifax).

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