credit card limit story

[davelj]

[quote=scaredycat]it’s just funny that their decision is so utterly irrational in terms of risk management. [/quote]

Actually, this is one of the MORE rational decisions I’ve seen by a financial institution in the recent insanity. Pay off the $50K and I bet you’ll see your credit limit on the Barnes & Noble card increase. This is the price you pay for financial gamesmanship. 2.5% on $50K is $1,250 pre-tax. After tax, probably $900 or so. And you’re having to pay down the balance with a minimum payment, so you’re not getting the full $900 in the first place. And we’re assuming you didn’t have to pay a 3% transaction fee to get the $50K, which is highly unusual. All in all seems like waste of time given the hassle involved and the pittance of a return. I mean, why bother? I don’t get it.

[an]

[quote=davelj]
Actually, this is one of the MORE rational decisions I’ve seen by a financial institution in the recent insanity. Pay off the $50K and I bet you’ll see your credit limit on the Barnes & Noble card increase. This is the price you pay for financial gamesmanship. 2.5% on $50K is $1,250 pre-tax. After tax, probably $900 or so. And you’re having to pay down the balance with a minimum payment, so you’re not getting the full $900 in the first place. And we’re assuming you didn’t have to pay a 3% transaction fee to get the $50K, which is highly unusual. All in all seems like waste of time given the hassle involved and the pittance of a return. I mean, why bother? I don’t get it.[/quote]
It’s not unusual at all to have the transaction fee waived when you open a new card. Citi, BofA, Capital One, etc does it. You’re thinking it’s a waste of time to make $900 for spending about 10 minutes opening a card? How rich are you? $900 for 10 minutes of “work” sounds like a great return for your time. Like the OP stated, the credit balance is only a small part of the whole puzzle. What if he has $100k in the bank and can easily pay of $50k immediately? How is that risky to offer him a $4k credit limit?

[an]

[quote=davelj]
Actually, this is one of the MORE rational decisions I’ve seen by a financial institution in the recent insanity. Pay off the $50K and I bet you’ll see your credit limit on the Barnes & Noble card increase. This is the price you pay for financial gamesmanship. 2.5% on $50K is $1,250 pre-tax. After tax, probably $900 or so. And you’re having to pay down the balance with a minimum payment, so you’re not getting the full $900 in the first place. And we’re assuming you didn’t have to pay a 3% transaction fee to get the $50K, which is highly unusual. All in all seems like waste of time given the hassle involved and the pittance of a return. I mean, why bother? I don’t get it.[/quote]
It’s not unusual at all to have the transaction fee waived when you open a new card. Citi, BofA, Capital One, etc does it. You’re thinking it’s a waste of time to make $900 for spending about 10 minutes opening a card? How rich are you? $900 for 10 minutes of “work” sounds like a great return for your time. Like the OP stated, the credit balance is only a small part of the whole puzzle. What if he has $100k in the bank and can easily pay of $50k immediately? How is that risky to offer him a $4k credit limit?

[an]

[quote=davelj]
Actually, this is one of the MORE rational decisions I’ve seen by a financial institution in the recent insanity. Pay off the $50K and I bet you’ll see your credit limit on the Barnes & Noble card increase. This is the price you pay for financial gamesmanship. 2.5% on $50K is $1,250 pre-tax. After tax, probably $900 or so. And you’re having to pay down the balance with a minimum payment, so you’re not getting the full $900 in the first place. And we’re assuming you didn’t have to pay a 3% transaction fee to get the $50K, which is highly unusual. All in all seems like waste of time given the hassle involved and the pittance of a return. I mean, why bother? I don’t get it.[/quote]
It’s not unusual at all to have the transaction fee waived when you open a new card. Citi, BofA, Capital One, etc does it. You’re thinking it’s a waste of time to make $900 for spending about 10 minutes opening a card? How rich are you? $900 for 10 minutes of “work” sounds like a great return for your time. Like the OP stated, the credit balance is only a small part of the whole puzzle. What if he has $100k in the bank and can easily pay of $50k immediately? How is that risky to offer him a $4k credit limit?

[an]

[quote=davelj]
Actually, this is one of the MORE rational decisions I’ve seen by a financial institution in the recent insanity. Pay off the $50K and I bet you’ll see your credit limit on the Barnes & Noble card increase. This is the price you pay for financial gamesmanship. 2.5% on $50K is $1,250 pre-tax. After tax, probably $900 or so. And you’re having to pay down the balance with a minimum payment, so you’re not getting the full $900 in the first place. And we’re assuming you didn’t have to pay a 3% transaction fee to get the $50K, which is highly unusual. All in all seems like waste of time given the hassle involved and the pittance of a return. I mean, why bother? I don’t get it.[/quote]
It’s not unusual at all to have the transaction fee waived when you open a new card. Citi, BofA, Capital One, etc does it. You’re thinking it’s a waste of time to make $900 for spending about 10 minutes opening a card? How rich are you? $900 for 10 minutes of “work” sounds like a great return for your time. Like the OP stated, the credit balance is only a small part of the whole puzzle. What if he has $100k in the bank and can easily pay of $50k immediately? How is that risky to offer him a $4k credit limit?

[an]

[quote=davelj]
Actually, this is one of the MORE rational decisions I’ve seen by a financial institution in the recent insanity. Pay off the $50K and I bet you’ll see your credit limit on the Barnes & Noble card increase. This is the price you pay for financial gamesmanship. 2.5% on $50K is $1,250 pre-tax. After tax, probably $900 or so. And you’re having to pay down the balance with a minimum payment, so you’re not getting the full $900 in the first place. And we’re assuming you didn’t have to pay a 3% transaction fee to get the $50K, which is highly unusual. All in all seems like waste of time given the hassle involved and the pittance of a return. I mean, why bother? I don’t get it.[/quote]
It’s not unusual at all to have the transaction fee waived when you open a new card. Citi, BofA, Capital One, etc does it. You’re thinking it’s a waste of time to make $900 for spending about 10 minutes opening a card? How rich are you? $900 for 10 minutes of “work” sounds like a great return for your time. Like the OP stated, the credit balance is only a small part of the whole puzzle. What if he has $100k in the bank and can easily pay of $50k immediately? How is that risky to offer him a $4k credit limit?

[scaredyclassic]

many times the 50k in assets. but it’s still worth it to me personally to make even a few hundred bucks on this kind of arbitrage. my fico’s still over 700. fees were lowered to
1% on my request. moneys in fdic insured acct. minimal risk. if I see a quarter on the street i pick it up. i got the money for a year. interest rates were higher when i got it. but even at 2.5%, probably an hour’s work, including setting up the automatic payment and calendaring the end date 1.5% of 50k, 750.00? if I saw 750 lying in the street i would definitely pick it up, wouldnt you? that’s how i see this money. it’s just lying in the street. I also keep it in an easily tradeable account where i can trade stock in the evnt of a cataclysmic event. I’m really not upset, it’s just, that was my regular everyday card and i liekd using it. The credit card company evaluated the risk based on one single data point. kinda like letting someone have a house just cause they have a good fico score without asking more…i think the odds of me actually defaulting on that 4k credit card (never ever been bankrupt, etc.) are as low as it gets, actually. if i had a house, i’d default on the mortgage waybefore id default on that credit card. i liekd that credit card. i liekd getting thos ebarnes and noble gift card. i alwaysam in barnes and noble and we read alot…i think i was a good customer! well, whatever, it still has 500 on it, i can still take it on special trips when we go to barnes and noble (you get a 5% rebate on barnes and noble purchases. ) but i cannot buy groceries.

[scaredyclassic]

many times the 50k in assets. but it’s still worth it to me personally to make even a few hundred bucks on this kind of arbitrage. my fico’s still over 700. fees were lowered to
1% on my request. moneys in fdic insured acct. minimal risk. if I see a quarter on the street i pick it up. i got the money for a year. interest rates were higher when i got it. but even at 2.5%, probably an hour’s work, including setting up the automatic payment and calendaring the end date 1.5% of 50k, 750.00? if I saw 750 lying in the street i would definitely pick it up, wouldnt you? that’s how i see this money. it’s just lying in the street. I also keep it in an easily tradeable account where i can trade stock in the evnt of a cataclysmic event. I’m really not upset, it’s just, that was my regular everyday card and i liekd using it. The credit card company evaluated the risk based on one single data point. kinda like letting someone have a house just cause they have a good fico score without asking more…i think the odds of me actually defaulting on that 4k credit card (never ever been bankrupt, etc.) are as low as it gets, actually. if i had a house, i’d default on the mortgage waybefore id default on that credit card. i liekd that credit card. i liekd getting thos ebarnes and noble gift card. i alwaysam in barnes and noble and we read alot…i think i was a good customer! well, whatever, it still has 500 on it, i can still take it on special trips when we go to barnes and noble (you get a 5% rebate on barnes and noble purchases. ) but i cannot buy groceries.

[scaredyclassic]

many times the 50k in assets. but it’s still worth it to me personally to make even a few hundred bucks on this kind of arbitrage. my fico’s still over 700. fees were lowered to
1% on my request. moneys in fdic insured acct. minimal risk. if I see a quarter on the street i pick it up. i got the money for a year. interest rates were higher when i got it. but even at 2.5%, probably an hour’s work, including setting up the automatic payment and calendaring the end date 1.5% of 50k, 750.00? if I saw 750 lying in the street i would definitely pick it up, wouldnt you? that’s how i see this money. it’s just lying in the street. I also keep it in an easily tradeable account where i can trade stock in the evnt of a cataclysmic event. I’m really not upset, it’s just, that was my regular everyday card and i liekd using it. The credit card company evaluated the risk based on one single data point. kinda like letting someone have a house just cause they have a good fico score without asking more…i think the odds of me actually defaulting on that 4k credit card (never ever been bankrupt, etc.) are as low as it gets, actually. if i had a house, i’d default on the mortgage waybefore id default on that credit card. i liekd that credit card. i liekd getting thos ebarnes and noble gift card. i alwaysam in barnes and noble and we read alot…i think i was a good customer! well, whatever, it still has 500 on it, i can still take it on special trips when we go to barnes and noble (you get a 5% rebate on barnes and noble purchases. ) but i cannot buy groceries.

[scaredyclassic]

many times the 50k in assets. but it’s still worth it to me personally to make even a few hundred bucks on this kind of arbitrage. my fico’s still over 700. fees were lowered to
1% on my request. moneys in fdic insured acct. minimal risk. if I see a quarter on the street i pick it up. i got the money for a year. interest rates were higher when i got it. but even at 2.5%, probably an hour’s work, including setting up the automatic payment and calendaring the end date 1.5% of 50k, 750.00? if I saw 750 lying in the street i would definitely pick it up, wouldnt you? that’s how i see this money. it’s just lying in the street. I also keep it in an easily tradeable account where i can trade stock in the evnt of a cataclysmic event. I’m really not upset, it’s just, that was my regular everyday card and i liekd using it. The credit card company evaluated the risk based on one single data point. kinda like letting someone have a house just cause they have a good fico score without asking more…i think the odds of me actually defaulting on that 4k credit card (never ever been bankrupt, etc.) are as low as it gets, actually. if i had a house, i’d default on the mortgage waybefore id default on that credit card. i liekd that credit card. i liekd getting thos ebarnes and noble gift card. i alwaysam in barnes and noble and we read alot…i think i was a good customer! well, whatever, it still has 500 on it, i can still take it on special trips when we go to barnes and noble (you get a 5% rebate on barnes and noble purchases. ) but i cannot buy groceries.

[scaredyclassic]

many times the 50k in assets. but it’s still worth it to me personally to make even a few hundred bucks on this kind of arbitrage. my fico’s still over 700. fees were lowered to
1% on my request. moneys in fdic insured acct. minimal risk. if I see a quarter on the street i pick it up. i got the money for a year. interest rates were higher when i got it. but even at 2.5%, probably an hour’s work, including setting up the automatic payment and calendaring the end date 1.5% of 50k, 750.00? if I saw 750 lying in the street i would definitely pick it up, wouldnt you? that’s how i see this money. it’s just lying in the street. I also keep it in an easily tradeable account where i can trade stock in the evnt of a cataclysmic event. I’m really not upset, it’s just, that was my regular everyday card and i liekd using it. The credit card company evaluated the risk based on one single data point. kinda like letting someone have a house just cause they have a good fico score without asking more…i think the odds of me actually defaulting on that 4k credit card (never ever been bankrupt, etc.) are as low as it gets, actually. if i had a house, i’d default on the mortgage waybefore id default on that credit card. i liekd that credit card. i liekd getting thos ebarnes and noble gift card. i alwaysam in barnes and noble and we read alot…i think i was a good customer! well, whatever, it still has 500 on it, i can still take it on special trips when we go to barnes and noble (you get a 5% rebate on barnes and noble purchases. ) but i cannot buy groceries.

[fredo4]

If you pay off your card every month, they aren’t making any money off you. Pair that with the fact that you have a 50K balance on another card and they have an excuse to lower your limit.
Guido and I put everything we buy on our cash rewards cards and pay them off every month too. So we get cash back for our purchases and don’t pay a cent of interest. I’m sure our card companies would love to dump us or lower our limit too.

[fredo4]

If you pay off your card every month, they aren’t making any money off you. Pair that with the fact that you have a 50K balance on another card and they have an excuse to lower your limit.
Guido and I put everything we buy on our cash rewards cards and pay them off every month too. So we get cash back for our purchases and don’t pay a cent of interest. I’m sure our card companies would love to dump us or lower our limit too.

[fredo4]

If you pay off your card every month, they aren’t making any money off you. Pair that with the fact that you have a 50K balance on another card and they have an excuse to lower your limit.
Guido and I put everything we buy on our cash rewards cards and pay them off every month too. So we get cash back for our purchases and don’t pay a cent of interest. I’m sure our card companies would love to dump us or lower our limit too.

[fredo4]

If you pay off your card every month, they aren’t making any money off you. Pair that with the fact that you have a 50K balance on another card and they have an excuse to lower your limit.
Guido and I put everything we buy on our cash rewards cards and pay them off every month too. So we get cash back for our purchases and don’t pay a cent of interest. I’m sure our card companies would love to dump us or lower our limit too.

[Author]

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