Lowering available credit to apply for PenFed Platinum

Discuss the Visa & MasterCard payment networks as well as cards that operate through them.
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reuben
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Lowering available credit to apply for PenFed Platinum

Postby reuben » Sat Jul 28, 2012 11:25 am

I'm on disability for what should be temporary purposes, so my income is a lot lower than it has been in years past. I want the PenFed Platinum card, but my available credit on credit cards is higher than my income. So, I'm under the impression I need to lower my available credit... I don't have any other credit lines open except for credit cards, no mortgage or HELOC or anything, own my car outright...

I originally though my low income, now $25K, but I've seen online sometimes even college students only working part-time jobs have gotten them, so maybe they'll give me one?

I was originally thinking about closing a couple of cards.

I've got an REI Visa I haven't used in years and never put more than $200 on it. This card is issued by US Bank. My statements say I have like a $12,000 credit limit. But, this is a Visa Signature card. I think I've read Visa Signature cards don't report your credit limit to the bureaus? So, there's no real reason to close this card?

The other one I've got that's a candidate for closure is an old American Express Clear Card. But I believe I've read in the past that American Express doesn't report credit limits either? Is this right?

Two other cards I actively use and was thinking about calling not to close, but lower the credit limits are the a American Express Blue Cash Everyday and a Citibank Thank You Premiere.

But, if American Express doesn't report credit limits, I don't even have to lower the limit on my Blue Cash? It's never had more than maybe $1200 charge on it in one month. And, the Citibank Thank You Premiere is one I recently got for the old $500 sign-up bonus (first one in a long time that I applied for), but it's a Visa Signature card. If they don't report limits, that one's nothing to bother lowering the credit limit either?

I'm going to check my credit reports before I apply for the PenFed Platinum, but wanted to double check some information and try to get tips about it as to what to look for when I have credit reports in hand.


Crashem
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Postby Crashem » Sun Aug 05, 2012 11:54 am

You got it wrong. Rejection from having available high available limits is rare. On the other hand, having high balances vs income is common. You have a lot of incorrect notions on your post. Not sure if I can correct all because typing on iPad is the worst. Amex reports limits aside from charge cards. Most visa sig report limits now. No need to close any cards. Just don't have reported balances and should be fine. Of course Penfed is conservative lender so you could get rejected for lots of other reasons.
Amex Centurion, Amex Platinum, Amex BCP 8k->24k (5/23/12), Amex TE 15k, Cap One 1.5% 15k->20k (8/7/13), CSP 25k, Chase Palladium 100k, Citibank AA 35k (AU), Firestone 1.8k->2.2k->2.4k (8/20/12), JFCU Jloc 30k, PenFed Plat Rewards 30k, SF Fire 30k, US Bank Cash+ 25k

CC Deville
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Postby CC Deville » Sun Aug 05, 2012 5:56 pm

US Bank reports the credit lines on their Visa Signatures. In fact, as far as I can tell, Bank of America is one of the last banks that does not report the credit lines on Visa Signature/World MasterCard.

Amex Clear is a credit card and it therefore reports the credit line. Only the Amex charge cards do not report credit lines for the simple fact that they do not have one.

PenFed is a strange beast. They will deny members with excellent, established credit profiles and high income if they detect "pyramiding." PenFed LOVES the word pyramiding. And as you have stated, some people with newer credit profiles or even lower incomes can be approved. Having too much available credit in relation to a low income can set off red flags to potential lenders. The premise being that a cardholder could go to town and rack up debt then subsequently walk away from it. I wouldn't put it past PenFed to look into that. They almost always request recent pay stubs before approving credit. At any rate, they are so conservative they even make Wells Fargo blush.

Why do you want the PenFed card so badly? It seems that there are better cards out there; Chase Freedom and BankAmericard Cash Rewards being two. It would be ashame to call Amex and US Bank to lower your credit lines with no gaurantee that you will get the PenFed card. I am a member of PenFed and I love their loans, but their credit cards do nothing for me.

FutureBillionaire
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Postby FutureBillionaire » Sun Aug 05, 2012 7:00 pm

CC Deville wrote:US Bank reports the credit lines on their Visa Signatures. In fact, as far as I can tell, Bank of America is one of the last banks that does not report the credit lines on Visa Signature/World MasterCard.

Amex Clear is a credit card and it therefore reports the credit line. Only the Amex charge cards do not report credit lines for the simple fact that they do not have one.

PenFed is a strange beast. They will deny members with excellent, established credit profiles and high income if they detect "pyramiding." PenFed LOVES the word pyramiding. And as you have stated, some people with newer credit profiles or even lower incomes can be approved. Having too much available credit in relation to a low income can set off red flags to potential lenders. The premise being that a cardholder could go to town and rack up debt then subsequently walk away from it. I wouldn't put it past PenFed to look into that. They almost always request recent pay stubs before approving credit. At any rate, they are so conservative they even make Wells Fargo blush.

Why do you want the PenFed card so badly? It seems that there are better cards out there; Chase Freedom and BankAmericard Cash Rewards being two. It would be ashame to call Amex and US Bank to lower your credit lines with no gaurantee that you will get the PenFed card. I am a member of PenFed and I love their loans, but their credit cards do nothing for me.


The Penfed Platinum rewards card easily outperforms the BankAmericad cash rewards. 5 points on gas all year round and 3 points on groceries is awesome. The redemption levels are awesome too.

I haven't used the Chase Freedom, but I know for a fact I don't feel like I need it since I own both of the Penfed Cards and a Discover More. I find Chase Freedom to be overrated.

Regarding the original poster, I would not lower limits unless they ask you to do so. Also, if you don't need big cash back on gas due to lack of driving or availability of affordable public transit, the Penfed cards won't give you as much bang for your buck.
Gas: Discover It, Penfed Platinum Rewards x2, Chase freedom, Citi TYP
Plane tickets: CSP
Groceries: AMEX BCP, Penfed Platinum Rewards,Citi TYP
Clothes: Express, Amex BCP, Discover IT
Amazon: Citi Forward, Cash +
Restaurants: Citi Forward, Chase Freedom, Discover IT, CSP
Hotels and other travel: Discover Escape, CSP
Movies: BofA travel rewards visa signature(fandango), Discover IT, Citi Forward, Freedom
Bars, clubs, tomfoolery: CSP, Citi Forward, Discover IT, Freedom
Balance transfers: Kroger 123 rewards
Bill Pay: Chase Ink Plus, Citi Forward
Everyday spending: Bofa Accelerated cash rewards amex, Discover Escape

reuben
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Postby reuben » Sun Aug 05, 2012 9:06 pm

Crashem wrote:You got it wrong. Rejection from having available high available limits is rare.


I've looked into the PenFed Platinum. They apparently are one of the rare companies that look into credit limits vs. income. At least that's what I read people saying on various forums...

Although now that you're challenging me on it, I'm gonna double check that that's what people were saying about it. It's the "pyramiding" thing CC Deville mentions that PenFed is apparently trying to make famous in the credit world.

Crashem wrote: Amex reports limits aside from charge cards. Most visa sig report limits now.


Okay thanks, this was the impetus for me originally posting, get opinions on this.

Even though it would be advantageous in my case, I've seen people on various forums complain they're credit limits weren't being reported (probably because they're trying to rebuild credit and want lower utilization scores). But this was just an afterthought I had that "maybe I don't need to close cards!"... Didn't go back and re-read what I vaguely remember people saying because the information is so scattered about everywhere, would take hours and hours to derive an opinion without just posting a question.


CC Deville wrote:Why do you want the PenFed card so badly? It seems that there are better cards out there; Chase Freedom and BankAmericard Cash Rewards being two.



Like FutureBillionaire says, 5 pts on gas, 3 pts on groceries, no revolving categories that make me dizzy trying to keep up, don't need any more errands.

Plus, two other features. No foreign transaction fees and good but not necessary is no fees for cash advance. You don't get an APR grace period for cash advances, but the APR is capped at 10% (less than 1% a month), but you don't get that up front (what is it?) 3-5% fee for a cash advance most cards have.

I'm going to be staying with a friend in South America for about 6 months next year. No foreign transaction fees and if there's trouble with my ATM card bank, a cheap cash advance from PenFed could come in very, very handy while I'm down there.

Basically, if I don't get this card, I'd have to get 2 other credit cards to replace what this one card does. One card for the extra points on gas and groceries and another card for the travel benefits. And these 2 different cards probably wouldn't do their respective jobs as well as the single PenFed would.

Two cards for these jobs are doable, but one card just makes things easier...

I plan on taking two cards with "no foreign transaction fees" down to South America, it would just be really good to have one of them be the PenFed one. Second one maybe a Capital One...

FutureBillionaire wrote:Regarding the original poster, I would not lower limits unless they ask you to do so.


This may be the way to go... Thing is from what I've read, I'm so sure they'll deny me for credit limits so high. Still, let them say no... I don't think that hurts my chances from getting the card in the future.

I'm gonna google around some more, think about what you guys said. Thanks, guys!

Crashem
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Postby Crashem » Mon Aug 06, 2012 12:11 am

Just app. I had that card. If you get rejected, then talk to u/w and see if high limits are the reason.
Amex Centurion, Amex Platinum, Amex BCP 8k->24k (5/23/12), Amex TE 15k, Cap One 1.5% 15k->20k (8/7/13), CSP 25k, Chase Palladium 100k, Citibank AA 35k (AU), Firestone 1.8k->2.2k->2.4k (8/20/12), JFCU Jloc 30k, PenFed Plat Rewards 30k, SF Fire 30k, US Bank Cash+ 25k

agp
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Postby agp » Mon Aug 06, 2012 3:31 pm

reuben wrote:They apparently are one of the rare companies that look into credit limits vs. income. At least that's what I read people saying on various forums...


^That, I can personally gaurantee, is not true. Penfed does look at your income and available credit, but it does not limit your credit limit based on your income.

Main Card: Amex Platinum
For gas: Penfed Platinum Cash Rewards
For travel & dining: Chase Sapphire Preferred

CC Deville
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Postby CC Deville » Mon Aug 06, 2012 3:53 pm

FutureBillionaire wrote:The Penfed Platinum rewards card easily outperforms the BankAmericad cash rewards. 5 points on gas all year round and 3 points on groceries is awesome. The redemption levels are awesome too.

I haven't used the Chase Freedom, but I know for a fact I don't feel like I need it since I own both of the Penfed Cards and a Discover More. I find Chase Freedom to be overrated.
.


Points? What can you redeem the points for? Cash? For most mere mortals with middle income and normal expenses it is hard to beat the Chase Freedom. Discover More would be on par of it had a basic 1% starting cash back instead of the tiers to $3,000.

*Edit: nevermind, I went to the PenFed site to see what the points could be redeemed for. Cash in the form of a prepaid debit card.

FutureBillionaire
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Postby FutureBillionaire » Mon Aug 06, 2012 5:24 pm

CC Deville wrote:Points? What can you redeem the points for? Cash? For most mere mortals with middle income and normal expenses it is hard to beat the Chase Freedom. Discover More would be on par of it had a basic 1% starting cash back instead of the tiers to $3,000.

*Edit: nevermind, I went to the PenFed site to see what the points could be redeemed for. Cash in the form of a prepaid debit card.


Yep. And you can redeem at pretty low levels too. It's an awesome card, no?
Gas: Discover It, Penfed Platinum Rewards x2, Chase freedom, Citi TYP
Plane tickets: CSP
Groceries: AMEX BCP, Penfed Platinum Rewards,Citi TYP
Clothes: Express, Amex BCP, Discover IT
Amazon: Citi Forward, Cash +
Restaurants: Citi Forward, Chase Freedom, Discover IT, CSP
Hotels and other travel: Discover Escape, CSP
Movies: BofA travel rewards visa signature(fandango), Discover IT, Citi Forward, Freedom
Bars, clubs, tomfoolery: CSP, Citi Forward, Discover IT, Freedom
Balance transfers: Kroger 123 rewards
Bill Pay: Chase Ink Plus, Citi Forward
Everyday spending: Bofa Accelerated cash rewards amex, Discover Escape

Crashem
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Postby Crashem » Mon Aug 06, 2012 10:04 pm

It is one of best reward cards around.
Amex Centurion, Amex Platinum, Amex BCP 8k->24k (5/23/12), Amex TE 15k, Cap One 1.5% 15k->20k (8/7/13), CSP 25k, Chase Palladium 100k, Citibank AA 35k (AU), Firestone 1.8k->2.2k->2.4k (8/20/12), JFCU Jloc 30k, PenFed Plat Rewards 30k, SF Fire 30k, US Bank Cash+ 25k



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