Disturbing news on Chase Credit Cards

Annie H.

Annie H.

Egalatarian
Mountain Trader said:
What I have wondered for a while is how Amex would view income earned in IRAs that is not distributed. Getting tax returns won't show any of that, and someone could have (intentionally) small income outside their IRA but a lot of income inside the IRA. Granted a creditor generally can't get to separated retirement savings but that doesn't mean it is worthless.
Click to expand...
It's kind of like a divorce-- don't co-mingle funds and they will generally be safe;). But that's not the answer that Amex wants so I'm not sure what good IRA income would do you other than to take the chance-- some do--to include the income in your "reported income" on an application. I report accrued interest on I-bonds on my tax return. I can't get that money until I sell the bonds.

Back in my accountant days, 75% of folks justified taking questionable deductions by saying "I always do it and IRS never says anything." Duh!!! It works until it doesn't-- or until you get audited-- or FR???


http://www.bankrate(dot)com/finance/credit-cards/can-credit-card-company-garnish-ira.aspx
http://www.nytimes.com/2009/04/02/business/retirementspecial/02CREDIT.html?_r=0
 
M

Mountain Trader

Level 2 Member
A few years ago, I was asked by an Amex csr what my income was. I asked how they defined income and was told it means the income on my tax return. I pointed out that tax returns do not include many forms of otherwise valid income. The csr stood firm that only taxable income was included in income. I then asked "So if I have a portfolio of $10 million of tax-free municipal bonds generating $400,000 a year of non-taxed interest, that would have no bearing on Amex's judgement of my financial qualifications?" The csr said "That's right".

You certainly can't argue with logic like that.
 
Last edited:
Annie H.

Annie H.

Egalatarian
Mountain Trader said:
A few years ago, I was asked by an Amex csr what my income was. I asked how they defined income and was told it means the income on my tax return. I pointed out that tax returns do not include many forms of otherwise valid income. The csr stood firm that only taxable income was included in income. I then asked "So if I have a portfolio of $10 million of tax-free municipal bonds generating $400,000 a year of non-taxed interest, that would have no bearing on Amex's judgement of my financial qualifications?" The csr said "That's right".

You certainly can't argue with logic like that.
Click to expand...
I wasn't going to respond to this but after thinking about it for a few days my first response--as it was when you first posted--do you ALWAYS believe what a CSR says? The person doing the FR is another thing. Yes, conventional wisdom is what was reported on last year's tax return but then there are community property states, spousal income, common law income and all sorts of other things. My "income" varies greatly from year to year depending on interest, dividends and especially capital gains.

This isn't applicable to me but what about disability payments which are not taxable and can range up to $50K a year, gifts, inheritances, awards, scholarships, grants...?
 
rhinodh

rhinodh

Level 2 Member
Back to Chase...I applied for Chase Freedom last night and it went into pending. I have two Chase cards: Sapphire Preferred (from 2011) and Hyatt (March 2015). Total CL between the two cards is $28K.

Credit score is around 800.

In the past two years, I have the following new credit accounts:
  • OBC (1/2014)
  • US Air MC (now Aviator Red, 1/14)
  • Hyatt Visa (3/2015)
  • Alaska MP Visa x2 (3/2015)
  • US Air MC (3/2015)
  • AAdvantage Platinum Visa (3/2015)
I haven't called recon. I'm trying to decide if I should wait for the decision in the mail or go ahead and call. Any thoughts?

Meanwhile, Amex Plat Biz 150k, Discover IT, and another Alaska MP personal card were instantly approved. Alaska MP Business went to review.
 
phantasmic

phantasmic

Level 2 Member
rhinodh said:
I haven't called recon. I'm trying to decide if I should wait for the decision in the mail or go ahead and call. Any thoughts?
Click to expand...
Seems less good comes from calling these days so my quick vote is just wait it out and see. I understand the impatience though. What does the application status phone number say? two weeks? or 7-10 days?
 
rhinodh

rhinodh

Level 2 Member
phantasmic said:
Seems less good comes from calling these days so my quick vote is just wait it out and see. I understand the impatience though. What does the application status phone number say? two weeks? or 7-10 days?
Click to expand...
It was last night, I believe it said 7-10 days. I'm going to try to wait it out if I can stand it.
 
M

Mountain Trader

Level 2 Member
Annie and I are on the same page. I was being sarcastic-you can't argue with that logic because there is no logic in the CSRs statement.

As to income properly not reported on a tax return and how Amex would view it in the context of a Financial Review, I think that is an unsettled matter. Clearly, Amex wants to start with hard facts-access to tax returns. My guess (hope) is that one could their way up the ladder to someone at Amex who would take a broader view, including the income not on a tax return.
 
wasser

wasser

Level 2 Member
Someone I know well who doesn't churn or MS, got turned down for Freedom after receiving the "pending status" when applying online - "too many credit cards opened in the past two years."
She's had four cards in two years: Sapphire, United, Barclay and a credit union Visa. Plus, she was the authorized user on two of her husband's cards.
 
Last edited:
R

raenye

Lever 2 Membel
wasser said:
Someone I know well who doesn't churn or MS, got turned down for Freedom after receiving the "pending status" when applying online - "too many credit cards opened in the past two years."
She's had four cards in two years: Sapphire, United, Barclay and a credit union Visa. Plus, she was the authorized user on two of her husband's cards.
Click to expand...
Sounds like recon would be able to approve her if she calls in and says "don't count AUs".
 
rhinodh

rhinodh

Level 2 Member
If I get declined for the Freedom (likely) and this turns out to be the new norm for Chase, I'll gladly downgrade my CSP and shift spending to Amex and/or Citi.
 
Annie H.

Annie H.

Egalatarian
rhinodh said:
Back to Chase...I applied for Chase Freedom last night and it went into pending. I have two Chase cards: Sapphire Preferred (from 2011) and Hyatt (March 2015). Total CL between the two cards is $28K.

Credit score is around 800.

In the past two years, I have the following new credit accounts:
  • OBC (1/2014)
  • US Air MC (now Aviator Red, 1/14)
  • Hyatt Visa (3/2015)
  • Alaska MP Visa x2 (3/2015)
  • US Air MC (3/2015)
  • AAdvantage Platinum Visa (3/2015)
I haven't called recon. I'm trying to decide if I should wait for the decision in the mail or go ahead and call. Any thoughts?

Meanwhile, Amex Plat Biz 150k, Discover IT, and another Alaska MP personal card were instantly approved. Alaska MP Business went to review.
Click to expand...
In your case, I'd say call ASAP. They may be able to see your newest apps via HPs but until the cards are reported on your credit report they can't say, "too many new cards" based on the most recent round.

Again, I was told by two senior analysts-- if they get the message "two many cards in last two years" it is company policy and they CANNOT override it. Also, if you call in you might have the ability to reallocate from your other two cards before recon is complete. Note there are different levels for recon--some can only approve up to $10K, others more.
 
rhinodh

rhinodh

Level 2 Member
Annie H. said:
In your case, I'd say call ASAP. They may be able to see your newest apps via HPs but until the cards are reported on your credit report they can't say, "too many new cards" based on the most recent round.
Click to expand...
The Freedom was the first application of the five I made last night. So, none of those other hard pulls should be on there.

That is, unless I have a complete misunderstanding of how it all works. I thought they can only receive your credit report when they pull it at application and base their decisions off of that report.

After that, they wouldn't receive an updated report that would reflect the subsequent applications, right?
 
ChiliPalmer

ChiliPalmer

Look at me.
rhinodh said:
The Freedom was the first application of the five I made last night. So, none of those other hard pulls should be on there.

That is, unless I have a complete misunderstanding of how it all works. I thought they can only receive your credit report when they pull it at application and base their decisions off of that report.

After that, they wouldn't receive an updated report that would reflect the subsequent applications, right?
Click to expand...
Well, they can't unless you authorize them to do so. Have they ever been asking for such authorization on recon calls?

I agree, though, that sooner is better.
 
ChiliPalmer

ChiliPalmer

Look at me.
I really think Chase is hitting the nail on the head here with the way they've gone about this.

They want to weed out churners, not credit risks. They don't care if you are the most liquid and prompt customer out there. They want you to be around after the sign up bonus. If you have amazing credit but stop using the card after you cost them their huge acquisition costs, you aren't a good customer. So they don't want you.

At the big picture level, I wonder how many good customers (not us) this is actually costing them. I'd guess that number to be pretty small.
 
Annie H.

Annie H.

Egalatarian
rhinodh said:
The Freedom was the first application of the five I made last night. So, none of those other hard pulls should be on there.

That is, unless I have a complete misunderstanding of how it all works. I thought they can only receive your credit report when they pull it at application and base their decisions off of that report.

After that, they wouldn't receive an updated report that would reflect the subsequent applications, right?
Click to expand...
That's the same way I did my recent UA EXP (and denied CSP)-- prior to my 2 AS. You're right, they won't be able to see your new HPs *after* your Freedom app. However, they can do soft pulls at any time and see every darn CC you have-- just the way you can at Credit Karma, etc. That's why I said sooner rather than later --but I'm just being cautious.
Who knows what they will ask on recon-- as I previously reported when I called for UA EXP the asked, "how much credit would you like on this card?" I had NO idea what to say or what that meant so I went big, re-allocated and then it got passed on to the guy who could approve over $10K.
 
Annie H.

Annie H.

Egalatarian
ChiliPalmer said:
Well, they can't unless you authorize them to do so. Have they ever been asking for such authorization on recon calls?

I agree, though, that sooner is better.
Click to expand...
Edited: A CC company should have permission to do a HP and if they do it without your permission you can dispute that HP on your report. I've never been sure exactly what information a company gets on a hard pull that it doesn't get on a soft.

However, per the Fair Credit Reporting Act, the business or third-party obtaining a credit report must have a legitimate reason for receiving and viewing a person’s credit report. I think that's the loophole that gives current companies a reason to do an HP but there's generally no reason for them to do so.
 
Last edited:
K

knick1959

Level 2 Member
Annie H. said:
For all of you who have been denied a Chase card don't forget that entitles you to a free credit report, most likely from EXP if that's who Chase used. That's in addition to the one free per agency per year. You can go online and request it although I was unable to get an electronic version and had to settle for paper.

http://www.experian.com/reportaccess/
http://www.experian.com/disputes/free-discounted-reports.html
Click to expand...
Yeah, for Ohio they pull from TransUnion. The rejection letter that eventually comes tells you which agency they actually used.

Don't forget that even after a failed reconsideration call, you can still send a physical, snail-mail letter. I was reminded of this fact myself by a fairly recent Miles to Memories blog post. Hang on ...
Code: 
http://milestomemories.boardingarea.com/credit-card-reconsideration-letter/
I used his example as a guide but plugged in my own middle, writing as my wife (she did approve and sign it :)). I explained how she's been a long-time Chase loyalist, and mentioned how her CSP card currently up for renewal doesn't offer the same value as without a Freedom companion card. In short I'm hoping that they realize we don't churn CHASE cards. At least not much :).

My original intent was to simply bitch about the new rules in this letter. Instead, I actually ASSumed there was still a chance to save the app and the credit pull and actually get the card afterall. If not, her CSP card goes away (I will keep mine) and maybe a couple of other non-UR cards will get canceled. And then perhaps a follow-up letter that turns it up a notch.
 
rhinodh

rhinodh

Level 2 Member
I called recon after work yesterday and was of course denied; the decision had already been made when I called in because as soon as I gave him my SS# he saw that it was denied.

I played "dumb" like I didn't know anything about the new "rules" and politely reminded the agent that I'd had a Sapphire Preferred since 2011 and have put about $100k of spend on the card over those four years, but that didn't help. I asked to speak to a supervisor and he transferred me to a senior analyst who reviewed my credit report and said the reason it was denied can't be overturned.

Both of them mentioned the 5 new credit accounts in the last two years I have (I actually have 6...one was an Amex that he either missed or maybe it's because it's backdated to my older Amex account) and that they wanted to wait and see how I handled this new credit. I mentioned to him how disappointed I was with the decision despite my CSP history, and that I'll be shifting my spending to Citi or Amex.

I've never churned the CSP or any other UR-earning cards. With the spend I made and account age, I'd think that I fell under the category of a "good customer" but I'll be downgrading my CSP to a no fee Freedom and will only put enough spend on there to maximize the quarterly bonuses from now on.
 
Annie H.

Annie H.

Egalatarian
Almost exactly what I was told with my 12 new cards in 12 months. They didn't believe me when I said I'd handle my new credit responsibly the same as I was handling my old credit.;)

I now feel quite lucky I did get the UA EXP that same day. Thanks for reporting and saving my SO a hard pull for the CSP-7 new cards in last 13 months.
 
Top