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Forums Payment cards American Express Amex personal rate upped due to increased risk

  • Chris8 6 posts

    I recently received a letter from Amex saying after review they’d be increasing my personal interest rate by about 5% citing “a review indicates a change in your circumstances, which may indicate an increase in the risk that you might not be able to repay us”.

    I have a fairly generous 10k limit and barely eat into 1/10th of that monthly, and pay my balance off in full and on time each month. I don’t ever carry a balance over or pay interest, so perhaps my thinking is that it’s just standard letter with a generic reason on, and I’m not particularly profitable due to this.

    It would be interesting to learn specifically what data points they use for this exercise, as all my other cards/CRA reported aspects are fine and always paid off in full and on time as well.

    It doesn’t concern me too much in terms of the interest rate, however, has anyone else that has received a similar letter had any ill effects further on down the line?

    ChrisBCN 261 posts

    So many things it could be, one example is if your income is lower than what you last told them it was.

    Devils Advocate 15 posts

    Your not paying interest so is it worth worrying about something that they will never tell you the answer too.

    Zook 3 posts

    My wife had a similar letter about her personal Amex card a couple of years ago and has always paid off her balance in full and on time each month, as you do. She has had no ill effects further on down the line.

    Skywalker 720 posts

    Credit card company logic:

    “You might not be able to repay us, so we’re increasing the interest rate so that we can make more money from you in the periods where you are unable to repay us”

    If your circumstances haven’t actually changed, maybe you should query what data they are referring to.

    NorthernLass 7,933 posts

    At least they haven’t cancelled all your cards, unlike on the other trending thread!

    eamongreen@me.com 1 post

    I have just received the very same letter. Like the OP I have always paid off my monthly balance and never missed a payment, so it comes out of the blue (pun intended).

    ee 48 posts

    We’ve both received these for our cards in the last month.

    In my case, I have total limits with Amex of £35k but rarely use 10% of this and all Amex cards are cleared in full each month by Direct Debit.

    The issue is probably that I’m sitting on 0% stoozes elsewhere of about £21k. My total credit utilisation is about 20% but the stooze is being repaid at minimum rates each month which probably doesn’t look good. That said, I could pay the stooze off tomorrow if I needed to.

    They can do what they want with my rate – I won’t be incurring any interest!

    BBbetter 717 posts

    It’s always a good idea to review the credit limits and reduce them periodically. Amex is notorious for pushing them up quietly. All well when interest rates are zero.
    It helps to reduce them if you have to apply for a loan or another card, not necessarily with Amex.
    Times have been good in the past, but you can’t predict the future. Other banks may not look kindly at a large limit.

    Andrew. 491 posts

    It’s always a good idea to review the credit limits and reduce them periodically. Amex is notorious for pushing them up quietly. All well when interest rates are zero.
    It helps to reduce them if you have to apply for a loan or another card, not necessarily with Amex.
    Times have been good in the past, but you can’t predict the future. Other banks may not look kindly at a large limit.

    Better still to hang onto the cards that aren’t reported to the agencies.

    There are quite a few ex-bankers on here who had “staff accounts”, it was policy for many firms not to report staff accounts to the agencies – the DNR flag still stands today. Some banks also placed a DNR flag on people who worked for other firms.

    BBbetter 717 posts

    It’s always a good idea to review the credit limits and reduce them periodically. Amex is notorious for pushing them up quietly. All well when interest rates are zero.
    It helps to reduce them if you have to apply for a loan or another card, not necessarily with Amex.
    Times have been good in the past, but you can’t predict the future. Other banks may not look kindly at a large limit.

    Better still to hang onto the cards that aren’t reported to the agencies.

    Of course, I meant not closing the cards, just managing the limits.

    On a similar note, if you have a charge card, hold on to it.

    Skywalker 720 posts

    Credit card company logic:

    “You might not be able to repay us, so we’re increasing the interest rate so that we can make more money from you in the periods where you are unable to repay us”

    If your circumstances haven’t actually changed, maybe you should query what data they are referring to.

    I received one of these letters today.

    I contacted Amex to explain to them I have the right to have correct data held about me, as well as the right to have incorrect data rectified. The letter is factually incorrect, I have paid every single bill on time (if not before), and my circumstances have not changed at all.

    The advisor said that it is a generic letter which isn’t tailored to individual circumstances (which is even worse!) and she is going to get the increased interest rate decision reversed. She also said that I will receive a letter in the post in the next couple of days to confirm this action.

    Just to be clear – I don’t pay interest – but what I do object to is Amex putting up its interest rates and citing its customers as the problem when it simply wants to put their rates up – which is entirely within their right to do, of course.

    In fact, Amex could have written to state they are putting their interest rates up, and I wouldn’t have batted an eyelid.

    I don’t know about anyone else, but I do worry about these things. In my view, if something false is put in writing and goes unchallenged, it becomes fact by tacit agreement.

    zio 257 posts

    Very well put.

    There is a right way and a wrong way (cf Creation) to go about things.

    Maples 223 posts

    I also got a letter and it seemed to have arrived last week when I was out. It’s for the Platinum Cashback Everyday card, which I barely use, and I’m pretty sure the rate had increased about 15-18 months ago and then it decreased last year.

    Lady London 2,112 posts

    Good one @Skywalker.

    CarpalTravel 368 posts

    Thanks for sharing, @Skywalker. Totally agree and will be sure to take the same approach if they try similar with me.

    JellyFan 20 posts

    Just to be clear – I don’t pay interest – but what I do object to is Amex putting up its interest rates and citing its customers as the problem when it simply wants to put their rates up – which is entirely within their right to do, of course.

    In fact, Amex could have written to state they are putting their interest rates up, and I wouldn’t have batted an eyelid.

    I totally agree.

    I’ve been an Amex customer for 8 years; have never missed a payment, never asked for a “retention bonus”, never used my Amex to send money through PayPal to friends, rarely if ever gone above 30% of my monthly credit limit, or done anything else likely to harm my standing.

    To then get a letter out-of-the-blue that reads as:

    “We don’t trust you, but we’re not saying why. Don’t like that? Close your account then, we DGAF.”

    Wow, great way to alienate your customers Amex! Really, good job!

    The only recent change to my financial circumstances is a pay rise. I have enough money in my ISA to pay off my card limit 30 times over. There is 0% chance that I will ever pay interest on my monthly spend.

    To send a letter like this is simply terrible customer service, and all the more unforgivable for implying that a change in my circumstances has made me untrustworthy if in fact it’s just a generic letter, not tailored to individual circumstances.

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