Call And Request Credit Card Applications

Category: Finance, Credit.

"I was just informed the interest rate on my credit card is jumping from 10% to 29% . I called my bank and they told me it s because some of my other credit accounts were highly utilized. " That s exactly what happened to my friend Kyle recently.

I ve never made a late payment. Because he was close to his credit limits on unrelated accounts his bank legally jacked up his interest rate nearly 200% . Kyle didn t have late payments with the credit card that raised his rates. The practice is generally referred to as a" universal review. " And more and more lenders are using this trick to fill their pockets at the expense of an unknowing public. In fact, he didn t have any late payments on any credit cards. This situation hasn t only happened to Kyle. However, his lender simply decided that because Kyle was using his other credit, he somehow became a greater credit risk to them- so they nearly tripled his interest rate.

You see, I have several friends that hold high positions within the banking industry. This information is so hush- hush he s asked us to keep his identity secret: ".Everyday in my job as a credit analyst I see so many mistakes people make with their credit. Here s a recent comment from one subscriber who works as a credit analyst for a major national bank. You are right, most all lenders do a universal review, especially credit card companies. When we find risk we either lower the credit line, or close the, increase the APR account. When we review a card member s credit bureau report( CBR) we are assessing risk to the bank and our goal is to reduce risk and exposure. That is why account performance and utilization of revolving trades is so important. " As you can see, Kyle s situation could have been worse.

And the credit analyst went on to say. ".A lot of times we are using old income information when making a decision. The lender could have closed the account or lowered his credit limit. Usually, when we see something that doesn t fit the card member s profile, we will call to try and get updated information such as current income and reasons for recent delinquency on their credit reports or their account with us. And that information can be several years old. If we can t get them on the phone the moment we call we have to make a decision with the information we have. If the income we have on file is older than six months I can t use it and need to call.

So it is in the card member s best interest to call the credit card company and give them updated income information and any explanation for delinquency or increased utilization. " So what do you do? If I don t get the card member I have to make my decision right then- I can t wait as we review thousands of accounts a month. First of all, if this has not happened to you, I wouldn t get overly concerned just yet. To be on the safe side, whenever your income increases you should call your credit card lenders and let them know- make sure they note it in your file. Just be aware that nearly half of the credit card lenders do some sort of universal review and it s a growing trend. If your credit card lender does conduct a universal review on you and you re negatively affected by their decision- here s what to do: Contact your lender immediately and determine why the lender feels you re a greater credit risk. and then fix it, if it s fixable. If the lender s answers don t sit well with you, begin interviewing new lenders.

It could be as simple as giving them updated income information. Call and request credit card applications. And if you re comparing credit cards you already have, and cannot locate the original application you signed. call each lender and ask them for a copy of your application with your current account s terms and disclosures. To determine if a credit card lender uses universal review, do this: go to the disclosure form and find the headline" Other APRs, " then look for the term" default rate. " That should tell you what you need to know. You need to know your current terms, as they may not be the same as the original offer you received. Remember, before you begin this cat& mouse game, have a" Plan B" in place. After you have compiled your list and found a lender that will give you acceptable terms and rates, contact your original lender and tell them you are considering closing the account.

Just make sure" Plan B" doesn t use the same or worse practices as your original lender. Not all lenders use them( thank God) , but be careful of the ones that do. Just be aware of card tricks. Lenders have lowered the bar on their ethics. It s up to us to read the fine print and play their game.

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