- Platinum Member
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- Joined: Mon Oct 06, 2008 2:50 pm
- Location: ..right behind you!
You probably wouldn't be amazed at the volume of calls American Express has been receiving because of this announcement, but let me tell you that it is substantial. What people don't seem to consider are two very important details.
1. You have to be INVITED to join this program. It is going to target a very specific card member type and it isn't likely that someone who doesn't use their AMEX card very often is going to be that time. It is likely (and I'll post what I can find out on the exact type when I learn about it) the kind of account that is regularly 30 or 60 days late and the system has determined that their probablilty of default is extremely high. It is likely not in collections yet, but based on patterns that we have seen before, it will soon be in that status. So good paying cardmembers who can live without their card aren't the target market. It is likely people who have trouble paying the minimum let alone at all.
2. They don't tell you this, and I'm working really hard to get some confirmation of this information, but I was told from someone who is reliable for this kind of info, that when the account gets closed it is marked as "closed by creditor" and is given a 'paid collection' status on your credit report. Neither one of those is a favorable thing. So I guess if your credit score means nothing to you and you are willing to sell fifty or eighty points for thirty pieces of silver, then go for it. Its not worth it for anybody who is interested in keeping their credit in good shape. I'll try to find a copy of the full rules of this offer so I can validate that piece of information.
Anyway, it is a good incentive for some I suppose, but not so good for others. Considering the class action that has been filed against AMEX for taking on too high of risk cardmembers, this could just be part of their attempt to buy back some of their credibility in the lawsuit.