What does a large transaction amount affect me?
 

Here's the case, I have an Amazon credit card issued by Chase with $2000 credit limit. And I use it a lot through purchasing the products for others and retaining the cash back myself. I spent roughly $20,000 each month on this card. Every few days when the credit limit runs out, I pay the debt through my chase checking account and the credit is released again. But I do this carefully to ensure that before the statement day, the balance is $0 on my credit card, so I can make the credit report looks good.

My question is, how does this kind of behavior affect my credit report or my relationship with Chase? Will I be granted more credit if I apply a credit increase in the future compared with someone who only spent $1000 through the same card? Will a have a higher credit limit if I get approved for another Chase credit card in the future? Will I have a better chance being approved for a new credit card by Chase or some other company because I make a lot of transactions and profit them?

Thank you.

Welcome to Flyertalk.

How long have you had the card, and how long have you been using it this way?

In any event the Chase card is not the best card for buying from Amazon. You would generate more rewards with the Citi Forward card which awards 5 points per dollar on purchases from bookstores (including everything purchased from Amazon), music stores (including iTunes), restaurants, and cinema tickets.

While forward is 5 points there is a 75k point cap per year, 15k purchases so would be exhausted very quickly if OP spends 20k month.

I would suggest either asking for a cli or opening a new card with a bonus and then reallocating the limit from new card to old card after getting bonus if you want to save your inq's

True, I had forgotten about the cap. Welcome to Flyertalk.

:D I will apply for Citi Forward card, it seems a pretty good deal.

But do you know how this kind of using-a-lot-of-credit behavior will affect my relationship with Chase and other banks? :confused:

Thank you in advance.

If you are paid off by statement date it will have no impact to other banks (they won't see anything other than your highest balance, credit line, length of credit, any delinquencies, etc).

To chase, they may see your total spend favorably. In some instances excessive use on a bonus category and recycling a credit line is a negative (see AARP 5% account where people would turnover their credit line a lot in each month racking up thousands of rebates). I would imagine an amazon co-brand wouldn't be viewed as negatively since 1. 3% is only a good return (compared to 2% easily found), vs a great one; 2. The card is co-branded to a retailer who wants it to generate sales volume and may be sharing a portion of the program costs for the rebate.

You would have an easy case for a CLI if you wanted to use an inquiry on that. I'd do what another suggested and go for a new, different card and move the lines around later if the low limit is a problem.

My only concern is that, to your credit report, it looks like a decent portion of the time it would show very high utilization rates. Other than that, I don't think it's a problem. You might call Chase though, and see if they'll bump your credit limit up, based on your obvious ability to pay it.

Also, x2 on the Forward. If you spend $15K+ on Amazon/dining, definitely worth having that card for the first $15K.

I cannot sensibly comment on that part without knowing: How long have you had the card, and how long have you been using it this way?

If you're are worried about high utilization rates on your report, why don't you just carry a negative balance on the card?

I have a Citi Premier ThankYou card that give 5x Thank You points that can be redeemed towards mortgage payments (now in 4th month of the 6 month promo).

Citi only gave me $3K credit line. My average spend on this card is $25K/month (all legitimate business expenses). I just make sure I always have a $3-4K negative balance on the card to help push charges through.
I've had it for over 4 months with no complaints from Citi.