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Check out you equity lines of credit...


RPSharman

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Thought I'd share, since I can't be the only here "dipping" into savings or lines of credit to stay afloat during this work slowdown.

My equity line of credit was just severely dropped without notice.  Whereas I had over $100k available credit last week, today I have $2.5k.  The banks says that the loan to value ratio has been reevaluated on all properties.  I can dispute or re-submit to their underwriting department with...you guessed it...proof of current employment.  DOH!

There goes my safety net.  And the belt tightens!!

Just want you guys to be aware so you can check your own "plan B"

Robert

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Let me add my incident of yesterday --- as additional warning ....

I've had an Amex Business card for 10yrs... flowed a LOT of equipment and supply payments, gas, office and general purchases for the business.... ZERO problems - no lates, no misses, no overages...  EVER.

9.9% from ten years ago to today ... they've made a lot of money from the typical 3% of my purchases over the decade. 

I have a large box of stuff over at Lectrosonics in the final stages of repair... expected it to be finished yesterday, and for Lectro to charge the card (on file)...

On the 25th I loaded up the Amex with 1700 from the already-tight business checking account to be ready for them...

(lots of 60+ day invoices out there - sound familiar?)

Yesterday, the 28th, Amex TOOK that payment, then promptly dropped my credit line 1500 bucks....  and my credit score is 740.  I am now SOL on this stuff until more comes in.... my available credit is now below 500, and the bill is around 1500.  (largest chunk is the old exploded-battery-in-the SM story... )

It is clearly, in these times, not in your best interests to load up your credit card too far ahead -

wait for the bill, then load it up the next morning (or THAT afternoon!) and have them pull the trigger immediately...

So -  watch out for these bastards.... they strike when you least expect it....

This S**T is the last thing I needed this month... let's hope the production floodgates start opening up soon...

Mike Filosa, CAS

Atlanta

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Yesterday, the 28th, Amex TOOK that payment, then promptly dropped my credit line 1500 bucks....  and my credit score is 740.

There is an article by columnist David Lazarus in today's Los Angeles Times about AMEX inexplicably cutting credit of customers with clean payment records:

http://www.latimes.com/business/la-fi-lazarus29-2009apr29,0,2448933.column

It seems pretty crazy and may blow up in their face. So far my account has not been impacted but, considering the solid accounts they are limiting, I think I may just be further down on their list.

David Waelder

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Let me add my incident of yesterday --- as additional warning ....

I've had an Amex Business card for 10yrs... flowed a LOT of equipment and supply payments, gas, office and general purchases for the business.... ZERO problems - no lates, no misses, no overages...  EVER.

9.9% from ten years ago to today ... they've made a lot of money from the typical 3% of my purchases over the decade. 

I have a large box of stuff over at Lectrosonics in the final stages of repair... expected it to be finished yesterday, and for Lectro to charge the card (on file)...

On the 25th I loaded up the Amex with 1700 from the already-tight business checking account to be ready for them...

(lots of 60+ day invoices out there - sound familiar?)

Yesterday, the 28th, Amex TOOK that payment, then promptly dropped my credit line 1500 bucks....  and my credit score is 740.  I am now SOL on this stuff until more comes in.... my available credit is now below 500, and the bill is around 1500.  (largest chunk is the old exploded-battery-in-the SM story... )

It is clearly, in these times, not in your best interests to load up your credit card too far ahead -

wait for the bill, then load it up the next morning (or THAT afternoon!) and have them pull the trigger immediately...

So -  watch out for these bastards.... they strike when you least expect it....

This S**T is the last thing I needed this month... let's hope the production floodgates start opening up soon...

Mike Filosa, CAS

Atlanta

This is also a PayPal trick.  Make sure they don't have access to your main bank account--start special one just for buying and selling and only give them access to that one.

Philip Perkins

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Can  all your credit cards but an AMEX card and pay it off ENTIRELY each month... Not an actual credit card if you use it this way....  And you never pay any interest....  just the yearly fee....    One card for me, one for business and one for the wife...all linked to the same freq. flyer account... I use it to purchase everything in my life...  even cars.....  rack up miles, use them for travel, then, get a neat fully itemized account of your spending for taxes at the end of the year... 

  I keep a bank VISA check card for the rare times a vendor does not deal with Amex...

For extended lines of credit I use my bank and have that in case I ever need to actually use funds I want to pay off...   Been at zero for years, but it's there...

The system works great....  at least for myself....

I believe AMEX is doing this to those that are keeping a balance, not deadheading the system.....  for us,  the Deadheaders  (pay off each month) they are making @3% on the purchases from vendors alone without the floating debt.

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i have ALWAYS used my credit cards as debit cards with a one month credit period. any purchases on the card, the moment the bill comes up and a day before the due date, i pay off the entire sum, thereby avoiding use of any credit and subsequent interest. deadheader i am.

btw, the cash limit on my card has been dropped by more than 50% as a 'security measure'. bullshit i think.

3% pm is the interest rate out here. that's 36% pa...

-vin

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Typical. these fucking vampires lose their shirts by betting on the wrong horse (sub-primes etc.) and then get their best customers to pony up. Here in Canada, no banks have failed. The government dropped the overnight inter-bank lending rate to effectively zero to open up lending. Did those shitheads use the windfall to open things up? No. It's much harder to get a loan now, and rates to consumers haven't come down substantially. Now the major banks are increasing service fees all over the place, because they can. How much profit do these fucking rats want? The sky's the limit obviously. Rant off. Chris Newton

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Actually Bob, they are doing it to the deadheaders as well.  I too payed my card off in full every month religiously for the past 15 years. They dropped my "unlimited" spending limit to $1500 without telling me word one. I had run up about 1400 in charges that particular month and only found out the limit when the card was denied as I tried to purchase some microphones. I thought "Oh that's no big deal, AMEX is just being cautious. I'll call and explain that it is indeed me making this purchase and they will authorize it." Nope. completely SOL.

Then when I called them on the practice, they basically said, "Yes, you have been with us for a long time haven't you. Too bad, so sad."

I'll never use them again. I only paid the yearly fee so that I could have the confidence that in an emergency I would always have AMEX. Not any more apparently. The only positive from the conversation was that when I told them I was going to cancel the card, they reminded me to use up my reward points first so I didn't lose all of them. Other than that, the lack of concern that I was leaving them was remarkable

Joe

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Joe,

  just got off the phone with Amex... 2 different Supervisors...... 

  I was told that there is NO specific across the board program to reduce the credit line of individuals using their cards...  There is however a newer and more stringent credit evaluation program, and persons are evaluated on a case by case basis depending on many factors, most importantly, your credit score.  If you or someone you know has had this happen, probably a good time to cross check your overall FICO or like score to make sure there was not a change you might not be aware of.

  Given the state of the overall credit industry, I am not surprised by such actions by the companies themselves...  I would institute the same programs if I were running Amex,  you can't really blame them....

I was told my account, it's limits or my standing will not, nor has, changed......  Provided I continue to do what I do, I was told there would be no problem... 

Who knows....  Good luck...

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Actually my wife and I were the victims of identity theft a couple of years ago, so I'm vigilant about checking my credit. Luckily, we caught on very quickly to the thieves so not very much harm was done.

What I was told is that because I haven't used the card much in the past few months (we've been trying to pay cash to keep ourselves in check during these lean times) my spending patterns had changed and that's what led to the reevaluation and limits on my account. What really pissed me off was that no amount of reasoning with them would make them reconsider. It just seems so counter to everything that they as a business oriented company have been touting for so long. If your business has a sudden need to invest in a substantial amount merchandise (gear in our case) one would find themselves SOL. While I understand that the credit industry is in turmoil, the most troublesome part is the lack of warning that they give the consumer. I had no idea.

The example I used with the supervisor that I finally ended up speaking to was a few years ago, while returning from shooting a documentary overseas, my cameraman and I were forced to buy a seat on the plane for the Betacam because Air France refused to let us put it in the overhead bin. Since the ticket was purchased day of the flight it was a considerable expense. Today if that had happened, AMEX would not have allowed me to buy the ticket and we would have been stuck with the choice of checking the camera in its soft case. (By the way, production did later reimburse us full cost with absolutely no questions asked-they were great)The supervisor's response to the story was, "Nothing I would be able to do about that today sir."

Joe

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Thanks for getting this started, Robert.  An interesting thread.  I'll share a couple of experiences regarding AmEx.  When I had an identity theft incident a couple of years ago, they were AWESOME.  Refunded everything immediately and Fed Ex overnighted new cards.  Really totally impressive in every way.  WaMu was horrible with their Visa, but I'll skip that story.  Got rid of the business debit card with them.

My wife and I have the AmEx cash rebate cards for both personal and our corporation.  Neither has an annual fee and we get several hundred $$ a year in cash back on each.  A great deal.  I charge about everything on them, like Bob, and use a Visa card only when absolutely necessary. AmEx keeps telling me to get their card with the fee and I do not see the appeal.  The cash rebate card is the best.  We pay off both every month.  I just checked and credit lines are not reduced, probably because we use them so regularly.  We are total deadheaders, as you all call it, but they still make money from vendors.  I always thought they liked people who carried a balance better, but maybe that has changed these days.  My wife had very bad experience with Capital One and I with CitiBank and others (MBNA?) in the past.  All Visa providers.  AmEx has always been a much classier act in my experience. YMMV.

PG

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Just an FYI:

Here's the credit card industry's jargon for its customer categories:

"Revolvers" roll credit card balances over month to month, never paying in full.

"Deadbeats" pay their balances off in full every month.

"Rate Surfers" or "Gamers" shift usage between credit cards based upon interest rates.

http://www.pbs.org/wgbh/pages/frontline/shows/credit/eight/

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At some point, the national credit card debt is going to reach critical mass and the industry will have its own meltdown. AmEx may be the first to go; they are having huge problems with their existing model. I'm not surprised by the changes, just the fact that they are changing things without informing customers, which one would think is in violation of their contract with customers.

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  • 2 weeks later...

Not to steer this off target, but has anyone noticed the Banks now charging for (and enforcing) every single small charge for everything!  For having less then 5K in the account, and hit me with a 10 buck charge per month, and will NOT waive it.  They use to in the past.. I took it all the way up to the top too, and they won't budge.. The fact that you've been with them for 30 years, doesn't seem to do anything anymore.  oh well.

Then when you ask about other accounts, they offer incentives to switch you too more limited accounts with less transactions, and if you go over the transactions, like one to many deposits or checks cashed, you get hit with more and more fees for excessive transactions..  Nice..

-Richard

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Not to steer this off target, but has anyone noticed the Banks now charging for (and enforcing) every single small charge for everything!  For having less then 5K in the account, and hit me with a 10 buck charge per month, and will NOT waive it.  They use to in the past.. I took it all the way up to the top too, and they won't budge.. The fact that you've been with them for 30 years, doesn't seem to do anything anymore.  oh well.

Then when you ask about other accounts, they offer incentives to switch you too more limited accounts with less transactions, and if you go over the transactions, like one to many deposits or checks cashed, you get hit with more and more fees for excessive transactions..  Nice..

-Richard

Not to tell you what you don't know but change to a more customer friendly bank. You don't have to be a victim of their nickle & dimeing you to death.

Eric

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Not to tell you what you don't know but change to a more customer friendly bank. You don't have to be a victim of their nickle & dimeing you to death.

Eric

Or a credit union, if you qualify.  We belong to Patelco, (from my wife's days working for the phone company) and they are much less  into this kind of airline-style crap.

Philip Perkins

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Got rid of my credit cards...just ordered the new Visa Debit card...use it like a credit card but its your own money...when you run out of money you run out of being able to use it...no controls by big brother...you control it...you can use it on the internet just like a credit card....never going back to the money barons....

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