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Best way to decreased likelihood?

Don't apply for credit cards you don't need. Don't apply for 17 credit cards in a year. Don't list an annual income of 50k then spend 10k/month on a card. Ect, ect, ect.

Use common sense. :rolleyes:

Quote:

Originally Posted by suspire (Post 18508120)

There is zero proof of this and I don't believe it for a second. Chase shutting down people's cards for high levels of regular spending? That makes no sense and would be a horrific business model--it would mean Chase is shutting down the accounts of those who make the most money for them.

Not quite, Chase makes the most money from people who carry balances, annual fees, and all the charges they get to tack on for late payments, funny names, having a pulse, etc.. Their profit on transactions is not where the big $$ is. In fact, one of the amusing facts that emerged from the close look at the industry over the past few years is that internally they refer to people who pay their bills in full every month as "deadbeats".

In a sense, somebody with lots of charges who doesn't carry a balance is the worst kind of customer for them. No interest income, no ancillary fees, and a very high ratio between the miles or other benefits they have to hand out and the annual fee revenue they receive from that account. The CC companies do get some transaction fees, but most of it goes to the merchant processor and the interchange (Visa, MC, etc.). I'll bet in the end they break even on the more generous cards like Visa Sapphire.

Quote:

Originally Posted by am1996 (Post 18508983)

Here is what I have a problem with here. Does it say somewhere that GC purchases violate T&C? It doesn't and Chase agrees, which is the reason that all the closure letters that people have posted do not point to a specific violation of T&C but, instead, give vague references to "rewards not used as intended" (what does this even mean? Is there something in the T&C about the intent of the program?).

I didn't personally put any GC purchases on any of my Chase cards but I don't like it when people start talking about non-existent T&C violations. I have no doubt that CC issuers did not intend for me to only put gas purchases and no other charges on CC's with 5% cashback. It is not a violation of T&C, however. If a CC issuer decides to close my CC for it, I suppose they have every right to do that but they don't have the right to falsely claim that they are doing it for any reason other then the fact that they are paying out more in cashback then they had intended to do. They don't have the right to portray their mistake in rolling out such a program as anything other than that. They certainly don't have the right to blame me for it.

Don't forget that the T&Cs don't give you any sort of right to hold the credit card, they are just to put you on notice of certain things that will get your card terminated and other things that the CC company will do to you with impunity. They can cancel your card at any time (thereby preventing any further purchases) and turn any account balance into what amounts to a loan with the terms specified in the agreement. As for "blame", I'm sure that Chase doesn't make any money on the x5 purchases, but they're counting on those purchases being a relatively small amount and on getting revenue from other card activities. In their opinion that's likely an abuse of their system, but reasonable minds can certainly differ.

Not that I think the credit card companies aren't a bunch of $#)%*#@s, but they're just doing what they're designed to do, make as much money as possible.

Quote:

Originally Posted by Boghopper (Post 18509137)

In fact, one of the amusing facts that emerged from the close look at the industry over the past few years is that internally they refer to people who pay their bills in full every month as "deadbeats".

That was pre-2008. After the banking crisis the regulators and their own risk managers required/encouraged them to even out their ratios with a flight to quality in their borrowers credit profiles.

Given that they are still earning $$ on interchange and are often able to procure points that we value at X for less than X, and/or commissions they capture from partners high quality credit folks are not necessarily not profitable. That said, its likely the people who are best at working the system are a drag on their returns, so logically they will look to cull where needed.

Pigs get fed. Hogs get slaughtered.

Chase must REALLY like me then because I opened SEVEN Chase checking accts over the last few years.:D;) Too bad the 25k Continental miles for Chase Checking is gone but the $200 checking signup bonus is still tempting.

Just building my relationship with Chase:p

My precious Chase cards...I've grown very attached to them. Would be very sad to lose them.:(

Quote:

Originally Posted by Jesperss (Post 18509118)

One more piece of common sense. If you have to call the reconsideration line, it's probably time to stop opening new accounts ... after you get approved for that new 'must have' card.

I view the reconsideration line as telling you that you're starting to look like a hog in Chase's eyes.

Moderator action

Two closely related threads started by the same member have been combined.

I think people are losing sight of customer types. Perhaps those that pay fees by carrying balances, etc. are more "profitable", but they are significantly riskier in the bank's eyes. A customer that pays off balances in full, but spends a lot, is a very UNRISKY and well liked by the bank.

This isn't about customer "profitability" - that has nothing to do with why Chase will close accounts.

It's the opening of multiple credit cards throughout the year, imbalance between spending and income, maxing out your card then paying off the balance several times a month, $500 purchases at Office Depot or Stables twenty times a month, bla bla bla.

Don't try to "game" the system or you'll lose. My guess is that every single person who has had their account closed has had that account closed for good reason.

Quote:

Originally Posted by Jesperss (Post 18514878)

Don't try to "game" the system or you'll lose.

Huh? Taking whatever actions will maximize credit card rewards while maintaining the same level of overall spending is the very definition of prudent financial management. It also is exactly what makes you unprofitable to CC issuers.

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My guess is that every single person who has had their account closed has had that account closed for good reason.

Absolutely and this reason is well known: people's prudent financial management is causing losses to CC issuers.

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Originally Posted by TheBigHens (Post 18514421)

Yes, except that if the same customer is collecting rewards in excess of the CC issuers' interchange fees, then the customer, while representing very low default risk, is causing CC issuers to lose money.