Use your credit cards and loose, don't use your credit cards and loose
By coffeebreak
@coffeebreak (17797)
United States
April 9, 2010 8:28pm CST
I am totally blown away. That's putting it nicely. I have 2 credit cards with Chase. Had them since they were Providian, then WAMU, now Chase. $6,000 credit limit on both. I am a responsible person, and don't run up bills I am not sure I can pay for. I am working on buying a house...first time in 32 years I have been able to qualify. My credit with the cards is perfect..never late, or anything.
Listening to the money gurus like Dave Ramsey and Suzy ORman...they were saying..pay it off and leave it open but don't use it.That helps you get a high FICO. I did this on my Walmart card, didn't use it for 3 years and they closed the account for non-activity.
Then they say, charge about $50 every 6 monhts to keep the card "active". So I do that..to keep it active and my good rating and high FICO.
Now I get a notice from Chase saying that they have reviewed my account and they have set my credit limit based on my usage... and DROPPED my credit limit to $500 each! I call and talk to them and all because I didn't keep the card maxed out so they would make money off it....I am not a customer they want to bother with cause I don't make them money so they are going to cut off my option to make them money. I can ask to have my limit increased, I said, no...just put it back to where it was. They wont. So apparently Chase only want customers who max out their cards so they can take a chance on making money off the card holder or loose completely when that card holder files bankruptcy. But a person that is perfect... they don't want.
So now, since I listened to the money gurus...my FICO just dropped from perfect to mid "okay" and I don't qualify for a good home loan and low rate.
What do I do now? How can this even be legal.. and I guess since they are doing this...home mortgages won't be coming out of the recession any time soon....
Anybody got any thoughts on this? I am just so totally flabbergasted and dumbfounded, I cant think even think straight. Last time I listen to a money guru tho!
3 people like this
11 responses
@momtrying2makeit (3270)
• United States
14 Apr 10
Well first of all I never take what someone tells me is right when it comes to credit. For me I have no credit cards and that is just the way I like it. I have past ones I had but I came to this realization it is an opinion but I want to share it. I do not need a credit card, if I had one it would be for emergency only. All the rules have changed on credit and all the banks want what you said people whom are gonna max out the card and than declare bankruspty later. For me I view credit this way it is credit when you first use the card after that you are paying money on your own money unless the balance is paid in full every month which most of us would not or could not do. Just be careful the next time you make a choice when it comes to credit you never know what may happen after you make your move.
@coffeebreak (17797)
• United States
15 Apr 10
Credit is a responsibility. I have had these cards for 10 years and only used them minorly just to keep a credit history in good standing for when I could buy a house. You can't buy a house without credit. I was not using them for anythig but this, and never went over a $100 or so. It was only for emergencies and credit history.
I don't like paying the high interest. i buy on sale and it just defeats the purpose if I buy on sale and then pay the high interest on the balance. Why bother dealing with sales... the point is to save money.
I will just let them sit as is... at least I have $1000 of emergency money. But that is all I will use them for. I might put $25 every other month just to keep them open for that emergency, but that's it.
@hvedra (1619)
•
16 Apr 10
You are what the credit card companies call a "deadbeat" because they don't make money from you - let alone lots of money from you.
What they are doing is punishing honest customers who pay and keep their finances in order. They are simply trying to force you to spend too much on your credit card (in order to get a "good" rating) so they can start hitting you with interest.
It is totally disgusting and what happens when you get banks and credit card companies writing legislation.
What they are doing is making sure they hit you for that interest and if they can't get it through your credit card they'll get it through the home-loan.
Disgusting on so many levels.
@drannhh (15219)
• United States
10 Apr 10
I have been with Chase through Coast and then Bank One and Wamu and now Chase and have cards I rarely use and also pay off within the grace period, and never borrowed money of and they were never devalued or the accounts closed, so something else might be going on. The difference with the Walmart card is that is a department store card, right, whereas the Chase cards are ones you can use anywhere. If you have a Chase checking acount, have you gone to see your local branch manager to see if s/he can help with this? That is what I would try first, because the customer service reps do not have the same authority. Presumably you have what they now call a "personal banker" assigned to you to help you with any problems. Good luck.
@coffeebreak (17797)
• United States
10 Apr 10
I started this account with Providian about 10 years ago. THen it went to WAMU and now to Chase. Perfect history for all and high limit all along! I talked to Chase and I could tell the rep aagreed with me, but couldn't say anything. THey literally said..you didn't use your limit, so that is why we don't think you need it.
@nitu1952 (285)
• India
10 Apr 10
ya that's a right thing. person who do not have a knowledge of using the credit card will definitely loose the money once a time. a person must be responsible for using the credit card carefully . it's use is now considered to be the trend. so always prefer to pay by means of cash.
@coffeebreak (17797)
• United States
10 Apr 10
I have knowledge of using them and used them responsibly and intelligently and carefully. I Have had the cards for 10 years and I never had a problem until Chase. They even said I had perfect history etc. But they said that since I didn't use it, they would take it away.
@machivado (528)
• Indonesia
10 Apr 10
I prefer debit card...Why should I use credit card if I have enough money in my debit card?? Well..the offers for getting credit card are pretty intriguing but I don't think using credit card too much is good for your financial mindset 
@coffeebreak (17797)
• United States
10 Apr 10
I use cash most of the time, an occassional debit card from my checking account. I don't run up bills I might not be able to pay. I was just using the cards for emergency and to keep my credit rating/score in good standing and hopefully high so should the time come that I could afford a home, I'd have all my ducks in a row. Chase kicked my row out of bounds!
@hofferp (4734)
• United States
12 Apr 10
Have you thought about writing your Congressman/Senators with a copy furnished to Chase? I'd let my politicians know that the law they passed last year to help the consumer is in fact hurting consumers, like you. Sometimes, to get the Congressman/Senators off their backs, they'll (in this case, Chase) make an "exception". You need an "exception" right now to Chase's policy. Sometimes it works...
@coffeebreak (17797)
• United States
13 Apr 10
No hadn't thought about that. Being in Calif tho.. there are so many problems out here now, I doubt they'd bother with little 'ol me. But I'll keep it in mind if I get some time. Thanks for that suggestion
@danishcanadian (28954)
• Canada
10 Apr 10
That is unbelieveable. I am not with Chase, but I do have an account with B of A for use when I am in the USA, and i have my Canadian account with BMO, since I live up here.
As for credit cards, BMO has given me a pre-paid credit card, which is attached to its own bank account. In other words, if I want to spend $500, I put $500 in the account, and THEN use the card. I like this better than having to borrow, and there are no nasty surprises.
But seriously, if you're fortunate enough to be able to qualify for credit, the bank shouldn't be able to drop you down the way they did.
@coffeebreak (17797)
• United States
10 Apr 10
Dumbest thing I ever have heard of...cutting their nose to spite their face. They cut me cause I wasn't using it thereby not making them any money on their high interest, but now I don't have the opportunity to use it and make them money on their high interest! Go figure. No wonder Chase was the biggest contributor to the recent recession. It's run by idiots!
@laglen (19759)
• United States
10 Apr 10
I am so sorry to hear this. I have a credit of zero. No activity whats so ever. 10 years, nothing at all. Not late and I have not taken any credit cards. Ten years ago I paid everything off and now pay cash. So, cars and houses, I save money or invest on something sellable. I doubt this will help you with your current situation. This is just what I do.
@coffeebreak (17797)
• United States
10 Apr 10
I've basically done the same thing. I only used the card to show activity and good payments and on time etc for my FICO score and good credit rating. I have had this account for 10years and never had this problem...until Chase took over!
@suspenseful (40192)
• Canada
19 Apr 10
I have at least three credit cards, and I alternate in using them. So no matter what month it is, I have used all of them and paid them off. The trouble is that the gurus give advice that tells you that if you cancel your card, your credit rate goes down, but since they are mainly dealing with people with bad credit, i.e. those whom having a credit card is a license to spend, spend, spend, they have no idea about the average person who pays the card off each month or pays a good balance on those that he cannot pay off.
Therefore they assume that the person reading their article is in financial trouble and for that person, not using the credit card would be a good idea. In fact, some of them suggest you use the envelope system and put money in it each month to pay your bills (and have a good alarm system or a fierce dog as backup.)
I would suggest that you do what was suggested by other mylotters and charge a small amount on each card, making sure that even though it is not maxed up (and thereby disappointing them by not making them money from overdue charges). Pay the amounts off each month. They will be waiting for you to make a big purchase that you will be unable to pay off in a few months.
Of course, when you make that big purchases, you will transfer the money from your checking or saving account, but they do not need to know that.
@echomonster (2225)
• Greenwood, Mississippi
10 Apr 10
This seems to be common practice now. I just have one credit card and use it regularly but pay the balance off each month. So far, no problems. At the end of the day, the credit card companies just want to make money off you. If you're active and making purchases regularly, they're getting transaction fees. If you're running up balances, they're getting interest. What they can't stand is people using them to try to get ahead in life. Heaven forbid you do something that helps only you and not them at the same time!
@coffeebreak (17797)
• United States
10 Apr 10
Yeah, they want to make the interest and transfer fees, I get that... that is why I don't understand why they took that option away from themselves! They aren't going to make much interest on $500 and I am not going to pay 3-4% balance transfer fee on that much so I don't see how they think they have done themselves any good!
But then if the card is always maxed out.. they think you are not responsible in spending your money so they don't want to risk BK so they drop your limit. Keep it responsible and reasonable and show you are both of those... and they drop your limit. What a bunch of idiots!
@spalladino (17891)
• United States
10 Apr 10
The money gurus aren't always the best folks to take advice from...but I don't have to tell you that now. It's a shame that you received such bad advice...and it was bad. Only using your credit cards every 6 months or so to charge small amounts only that you pay off immediately definitely don't make the card companies happy...especially now that they've been forced to treat their customers better by law.
What you don't want to do is to request a credit increase from Chase because, if you are denied, that will hurt your credit even more. Since you do have a good credit history (FICO score aside for now) you could apply for another credit card from someone else. If you become a member of a credit union, make regular deposits over a few months, you might be able to get a card from them with a decent limit. As angry as you are with Chase, you should continue to keep their credit cards, use them for small purchases that you pay off monthly. The key to keeping credit card companies happy is activity. I don't know if there is any truth to this but we carry a small balance on each of our credit cards once or twice a year so that they can charge us a little bit of interest. The following month we return to paying the balance in full.
@coffeebreak (17797)
• United States
10 Apr 10
I seldom take the advise of these gurus as I have lived pay check to pay check all my life and had to learn by necessity how to stretch the nickles till the buffalo poops and stretch the dollars till Washington grins. They dont' have a single money saving tips to offer me that I haven't been doing for 32 years that I learned on my own.
But not knowing details about how creditors "work" ... I try to learn from those that say they know. I used to be a mortgage loan processor before this foreclosure thing hit and so I am aware what the lenders look for. Trying now to buy my american dream for the very first time, it hits at worst time ever and I don't get a second chance.
I told Chase to leave it as is. I didn't want another ding on my report for their inquiry and didn't want to go through it all and one, have them deny me anyway and two...I can't trust them now. What if they do raise it back to where it was, and I go through the purchase procedure and the last thing the lenders do is run a back up credit report to make sure nothings changed since they run it 30-45 days ago and then Chase go and drop my limits again and the whole loan goes bust. I can't trust them. So I will be looking at other places to get an account... and hopefully close Chase all together. Don't want to be where I am not wanted!
