MBNA Credit Card Automatic Credit Line Increase
Guest: Bikshu
Post subject: MBNA Credit Card Automatic Credit Line Increase
Posted: Sat Sep 16, 2006 3:19 am
Quote:
JoyJoy wrote:
Bikshu, what did you mean by "I'm not going to give you squat if you use of of those bloody access checks"? MBNA sent my friend Alecia 0% access checks and 0% balance transfers good until Sept., 2007. You wouldn't give her a higher CLI if she were to use one of these checks?
hesiden wrote:
He's say a human can give you a better deal then the checks. Of course it'd be hard to be 0%, may a longer period.
Yes and no.
At that point in time I was speaking specifically in regards to automatic CLIs. Many (but by no means all) MBNA reps have the ability to offer you an auto CLI from time to time. This is an auto CLI that is in addition to the ones you may recieve periodically on your statements.
However, you are correct that we can almost always offer you a better rate than the checks as well. And we will absolutely never offer you a worse rate... but we can often do better. Now you are right that if we have offered you a 0%, that's usually as good as it gets. The only way to get better is if I were to pay you to borrow money, and that's definitely not happening. I may offer to extend the 0% by one month, but not always. I can also offer to do multiple transfers for just one transfer fee, depending on what amounts of money you are moving and at what interest rate.
When I said "I'm not going to give you squat if you use one of those bloody access checks" I specifically meant that I will not offer you the auto CLI. But you are correct that I wouldn't offer you the better rate or the reduced transfer fees either. We offer these things as a thank you for taking the time to call in, talk to a real human being, and have that real human being process the transactions for you. I'm employed by the bank to move money, so I'll reward you if you help me move money.
Don't take this to mean that we are on commission however, which I assure you we are not. The reason we are not is because there are too many laws and regulations that we must follow. It would not be in the bank's best interest to put us on commission, because then we would "do whatever it takes to get the sale." And there is too much money at stake for the bank to have its associates breaking laws and making bad loans simply to enlarge their own personal paychecks. Our productivity (both the total volume of cash moved and at what rates) is still tracked nevertheless. And although this productivity doesn't impact my paycheck from week to week per se, it definitely impacts whether I'll recieve a promotion or not. It is also a pride thing as well. In my department there is a lot of competition among associates. After all, we are a bunch of salesmen at heart. Who moved the most cash, at what rates, how efficiently did they do it, who had the most customers send in letters of thanks, etc. These stupid things matter to us. After all, we have to justify our own measely existances! And if I can't even do what a little piece of paper can do... woe is me!
But the bank has no way of tracking whether I persuaded you to move money or not if you simply use an access check. Thus, if you call in and ask me a million questions but then insist on using a check, I don't even get to call that transfer my own. I spent time with you and have nothing to show for it, so in a way you wasted my time. Therefore, there is no reason for me to even mention that I can do an auto CLI, give you a better rate, or save you money on the fee. This then, is why I said I hate those bloody checks!
CardRatings.com is the most comprehensive source for comparing credit card offers. Please visit CardRatings.com to view the best rated credit cards!
Guest: Bikshu
Posted: Sat Sep 16, 2006 4:46 am
Quote:
I love the information but, as usual, I'm confused by the contradictions.
MBNA likes to see you using your card near the credit limit--that encourages it to raise the credit limit. But it also wants you to maintain a nice FICO score, which is hard to do if you're maxing out your card. Catch 22?
MBNA wants you to take advantage of its promos. But it doesn't want you to be a "rate surfer"--someone who takes advantage of the promos of other banks! Catch 22?
That said, I'm very impressed with the information you've shared with us Bikshu. And I'll remind the folks of something you've also posted several times--those in your department get praise and rewards (bonuses? commissions?) for the business they generate. THAT is why it's good to call and speak with someone rather than use those darn access checks. I'm always reluctant to call for a deal for fear of the questions I might be asked--my credit card usage looks weird if you don't know what I'm doing, and because of the "rate surfer" problem I don't really want to say what I'm doing. But I'll be calling in the future!
You are right as usual sir. They are certainly tough contradictions to manage, but not impossible.
First, remember that utilization will only temporarily lower your FICO. So although you may show an artificially deflated FICO for a while when your BT balance is large, presumably at some point you'll pay it off and your FICO will go right back up the next month. Our computer strategies system (HAL as it was amusingly referred to above) will see your credit reports cumulatively going back as far as you've had a banking relationship with us. So we will see if your FICO has simply been temporarily deflated due to one or two larger BTs. And in that case we would not hold that against you. So if that's the only thing counting against you, then you have absolutely nothing to worry about. Worst case scenario is that you simply wouldn't receive any auto CLIs during the life of the BT... no big deal. Thus, you can definitely do large BTs and still get auto CLIs. Again, as you are very well aware of it all boils down to demonstrating fiscal responsibility.
The second Catch 22 makes me laugh, and I thank you for that sir. My initial response is that the bank itself (myself not included for the purposes of this statement) only PARTIALLY wants you to take advantage of its BT offers for a few reasons:
1. Given the choice they'd much rather that you kept the card exclusively for intense retail purchase usage even if you pay it off in full every single month. Interchange fees are much more profitable than loaning out money at interest rates far below Prime.
2. If you are going to use the card for BTs, we can at least hope/wish/pray that you'll continue to revolve that balance after the promo expires. We lose money while your balance is at 1.99%, we make money if its at 9.99%. If you transfer it right back to another bank, we never have the opportunity to make our money. We've got stockholders to answer to (me being one of them!) The same can be said for that other bank as well.
3. We do BTs mainly as a way of generating advertising/goodwill. People want them, people demand them, so we provide them. We hope/wish/pray that by helping you in your time of need with a BT, you will continue to use us when times are good for your daily use (again it comes back to those lovely interchange fees!) Nowadays if a bank doesn't offer promo rates, they have no chance to expand their market share. Sometimes I feel like whatever bank initially came up with the idea of the BT so many years ago now regrets it. They unleashed an evil genie that now no one can put back in its bottle!
Why I hate those checks (and why I said above that I don't include myself as only PARTIALLY wanting you to take advantage of promo rates): if you check one of the posts immediately above this I reiterated exactly why it is. Survery says: I want a promotion! I don't really want to stay on the phones forever. I'd like to move into the Business Development department at some point (those are the folks who make all the deals with our affinity groups... very cool stuff for a guy like me with economics and marketing backgrounds). Although now with us being BOA, there are some even cooler opportunities completely outside of the credit card division as well, opportunities we never had when we were just MBNA. Anyway, I can't go anywhere unless I'm producing. Don't underestimate that pride factor too. The competative nature of my department is kind of like the movie Boiler Room, minus all the illegal stuff of course. So although I may be no more important that lousy little piece of paper, I certainly don't need anyone else to remind me of that fact! Just joking... kind of... no seriously I'm joking... kind of...
You should never ever feel weird about calling in to do a BT. We have seen it all and we've all become quite used to not judging anyone. Man I see people with FICOs in the 400s and I see people with FICOs in the 800s. I see people who want to BT $50 (I tell them just pay that other account off the next statement they get... its worth neither my time nor effort to BT $50). I see people who want to ACH $250,000. I see an extreme surfer on one call followed by a person who doesn't even know what a BT is the next call. For the most part, I'm not going to ask you what you want the ACH for. Its none of my business if you are using the money to pay down your HELOC, using it to cleverly pay down another account with me, or using it to invest (although with that last one I may ask you a few questions because I want to get in on that sweet action too!) I will also never make a rate surfer feel bad about what they are doing. Its perfectly legitimate. They are beating the banks at the banks' own game... we associates respect that. We just may not be willing to beat the rate on the check, that's all. But again, even if I won't beat the check I'll never offer worse than the check. And we will never submit your account for a credit risk review unless our system indicates that there may be issues. And in these cases, the system will force a credit analyst to call you to do a review before we will honor the access check anyway. So even then its no loss to call in. Finally, I'm quicker than both the checks and the internet in terms of processing and posting speeds. Yeah that's right, this is one of the few areas in which humans are actually faster than the Internet. Because I can do all needed fraud verification with you in a couple seconds over the phone, whereas with the other two methods we need to do some extra work to ensure it really was you authorizing the transactions.
CardRatings.com is the most comprehensive source for comparing credit card offers. Please visit CardRatings.com to view the best rated credit cards!
Guest: Bikshu
Posted: Sat Sep 16, 2006 4:57 am
Quote:
My question is does MBNA use vantage Score?
No. Not yet at least. You will find that very few lenders are using Vantage as of now. Most analysts haven't had time to learn enough about it yet, and most haven't had enough time to adjust to comparing it to FICOs. I personally don't really know much about it all, other than I bought mine from Experian a few months ago just to see it for curiousity.
I'm sure it will inevitably cross our path at some point in the future. But not just yet. Also, just FYI: from what I've heard the CRA may charge more for Vantage scores than FICOs as well. And we certainly don't want to have to pay more for each credit pull than we already do...
CardRatings.com is the most comprehensive source for comparing credit card offers. Please visit CardRatings.com to view the best rated credit cards!
Guest: JoyJoy
Credit Expert (100+ Posts)
Posted: Sat Sep 16, 2006 10:24 am
Bikshu,
Thank you for all of the information you have shared in this post. I found it very valuable; I even understand better your point regarding the "bloody access checks".
JoyJoy
_________________
J~J
"You may never know what results come from your action. But if you do nothing, there will be no result." Mahatma Gandhi
CardRatings.com is the most comprehensive source for comparing credit card offers. Please visit CardRatings.com to view the best rated credit cards!
Post subject: MBNA Credit Card Automatic Credit Line Increase
Posted: Sat Sep 16, 2006 3:19 am
Quote:
JoyJoy wrote:
Bikshu, what did you mean by "I'm not going to give you squat if you use of of those bloody access checks"? MBNA sent my friend Alecia 0% access checks and 0% balance transfers good until Sept., 2007. You wouldn't give her a higher CLI if she were to use one of these checks?
hesiden wrote:
He's say a human can give you a better deal then the checks. Of course it'd be hard to be 0%, may a longer period.
Yes and no.
At that point in time I was speaking specifically in regards to automatic CLIs. Many (but by no means all) MBNA reps have the ability to offer you an auto CLI from time to time. This is an auto CLI that is in addition to the ones you may recieve periodically on your statements.
However, you are correct that we can almost always offer you a better rate than the checks as well. And we will absolutely never offer you a worse rate... but we can often do better. Now you are right that if we have offered you a 0%, that's usually as good as it gets. The only way to get better is if I were to pay you to borrow money, and that's definitely not happening. I may offer to extend the 0% by one month, but not always. I can also offer to do multiple transfers for just one transfer fee, depending on what amounts of money you are moving and at what interest rate.
When I said "I'm not going to give you squat if you use one of those bloody access checks" I specifically meant that I will not offer you the auto CLI. But you are correct that I wouldn't offer you the better rate or the reduced transfer fees either. We offer these things as a thank you for taking the time to call in, talk to a real human being, and have that real human being process the transactions for you. I'm employed by the bank to move money, so I'll reward you if you help me move money.
Don't take this to mean that we are on commission however, which I assure you we are not. The reason we are not is because there are too many laws and regulations that we must follow. It would not be in the bank's best interest to put us on commission, because then we would "do whatever it takes to get the sale." And there is too much money at stake for the bank to have its associates breaking laws and making bad loans simply to enlarge their own personal paychecks. Our productivity (both the total volume of cash moved and at what rates) is still tracked nevertheless. And although this productivity doesn't impact my paycheck from week to week per se, it definitely impacts whether I'll recieve a promotion or not. It is also a pride thing as well. In my department there is a lot of competition among associates. After all, we are a bunch of salesmen at heart. Who moved the most cash, at what rates, how efficiently did they do it, who had the most customers send in letters of thanks, etc. These stupid things matter to us. After all, we have to justify our own measely existances! And if I can't even do what a little piece of paper can do... woe is me!
But the bank has no way of tracking whether I persuaded you to move money or not if you simply use an access check. Thus, if you call in and ask me a million questions but then insist on using a check, I don't even get to call that transfer my own. I spent time with you and have nothing to show for it, so in a way you wasted my time. Therefore, there is no reason for me to even mention that I can do an auto CLI, give you a better rate, or save you money on the fee. This then, is why I said I hate those bloody checks!
CardRatings.com is the most comprehensive source for comparing credit card offers. Please visit CardRatings.com to view the best rated credit cards!
Guest: Bikshu
Posted: Sat Sep 16, 2006 4:46 am
Quote:
I love the information but, as usual, I'm confused by the contradictions.
MBNA likes to see you using your card near the credit limit--that encourages it to raise the credit limit. But it also wants you to maintain a nice FICO score, which is hard to do if you're maxing out your card. Catch 22?
MBNA wants you to take advantage of its promos. But it doesn't want you to be a "rate surfer"--someone who takes advantage of the promos of other banks! Catch 22?
That said, I'm very impressed with the information you've shared with us Bikshu. And I'll remind the folks of something you've also posted several times--those in your department get praise and rewards (bonuses? commissions?) for the business they generate. THAT is why it's good to call and speak with someone rather than use those darn access checks. I'm always reluctant to call for a deal for fear of the questions I might be asked--my credit card usage looks weird if you don't know what I'm doing, and because of the "rate surfer" problem I don't really want to say what I'm doing. But I'll be calling in the future!
You are right as usual sir. They are certainly tough contradictions to manage, but not impossible.
First, remember that utilization will only temporarily lower your FICO. So although you may show an artificially deflated FICO for a while when your BT balance is large, presumably at some point you'll pay it off and your FICO will go right back up the next month. Our computer strategies system (HAL as it was amusingly referred to above) will see your credit reports cumulatively going back as far as you've had a banking relationship with us. So we will see if your FICO has simply been temporarily deflated due to one or two larger BTs. And in that case we would not hold that against you. So if that's the only thing counting against you, then you have absolutely nothing to worry about. Worst case scenario is that you simply wouldn't receive any auto CLIs during the life of the BT... no big deal. Thus, you can definitely do large BTs and still get auto CLIs. Again, as you are very well aware of it all boils down to demonstrating fiscal responsibility.
The second Catch 22 makes me laugh, and I thank you for that sir. My initial response is that the bank itself (myself not included for the purposes of this statement) only PARTIALLY wants you to take advantage of its BT offers for a few reasons:
1. Given the choice they'd much rather that you kept the card exclusively for intense retail purchase usage even if you pay it off in full every single month. Interchange fees are much more profitable than loaning out money at interest rates far below Prime.
2. If you are going to use the card for BTs, we can at least hope/wish/pray that you'll continue to revolve that balance after the promo expires. We lose money while your balance is at 1.99%, we make money if its at 9.99%. If you transfer it right back to another bank, we never have the opportunity to make our money. We've got stockholders to answer to (me being one of them!) The same can be said for that other bank as well.
3. We do BTs mainly as a way of generating advertising/goodwill. People want them, people demand them, so we provide them. We hope/wish/pray that by helping you in your time of need with a BT, you will continue to use us when times are good for your daily use (again it comes back to those lovely interchange fees!) Nowadays if a bank doesn't offer promo rates, they have no chance to expand their market share. Sometimes I feel like whatever bank initially came up with the idea of the BT so many years ago now regrets it. They unleashed an evil genie that now no one can put back in its bottle!
Why I hate those checks (and why I said above that I don't include myself as only PARTIALLY wanting you to take advantage of promo rates): if you check one of the posts immediately above this I reiterated exactly why it is. Survery says: I want a promotion! I don't really want to stay on the phones forever. I'd like to move into the Business Development department at some point (those are the folks who make all the deals with our affinity groups... very cool stuff for a guy like me with economics and marketing backgrounds). Although now with us being BOA, there are some even cooler opportunities completely outside of the credit card division as well, opportunities we never had when we were just MBNA. Anyway, I can't go anywhere unless I'm producing. Don't underestimate that pride factor too. The competative nature of my department is kind of like the movie Boiler Room, minus all the illegal stuff of course. So although I may be no more important that lousy little piece of paper, I certainly don't need anyone else to remind me of that fact! Just joking... kind of... no seriously I'm joking... kind of...
You should never ever feel weird about calling in to do a BT. We have seen it all and we've all become quite used to not judging anyone. Man I see people with FICOs in the 400s and I see people with FICOs in the 800s. I see people who want to BT $50 (I tell them just pay that other account off the next statement they get... its worth neither my time nor effort to BT $50). I see people who want to ACH $250,000. I see an extreme surfer on one call followed by a person who doesn't even know what a BT is the next call. For the most part, I'm not going to ask you what you want the ACH for. Its none of my business if you are using the money to pay down your HELOC, using it to cleverly pay down another account with me, or using it to invest (although with that last one I may ask you a few questions because I want to get in on that sweet action too!) I will also never make a rate surfer feel bad about what they are doing. Its perfectly legitimate. They are beating the banks at the banks' own game... we associates respect that. We just may not be willing to beat the rate on the check, that's all. But again, even if I won't beat the check I'll never offer worse than the check. And we will never submit your account for a credit risk review unless our system indicates that there may be issues. And in these cases, the system will force a credit analyst to call you to do a review before we will honor the access check anyway. So even then its no loss to call in. Finally, I'm quicker than both the checks and the internet in terms of processing and posting speeds. Yeah that's right, this is one of the few areas in which humans are actually faster than the Internet. Because I can do all needed fraud verification with you in a couple seconds over the phone, whereas with the other two methods we need to do some extra work to ensure it really was you authorizing the transactions.
CardRatings.com is the most comprehensive source for comparing credit card offers. Please visit CardRatings.com to view the best rated credit cards!
Guest: Bikshu
Posted: Sat Sep 16, 2006 4:57 am
Quote:
My question is does MBNA use vantage Score?
No. Not yet at least. You will find that very few lenders are using Vantage as of now. Most analysts haven't had time to learn enough about it yet, and most haven't had enough time to adjust to comparing it to FICOs. I personally don't really know much about it all, other than I bought mine from Experian a few months ago just to see it for curiousity.
I'm sure it will inevitably cross our path at some point in the future. But not just yet. Also, just FYI: from what I've heard the CRA may charge more for Vantage scores than FICOs as well. And we certainly don't want to have to pay more for each credit pull than we already do...
CardRatings.com is the most comprehensive source for comparing credit card offers. Please visit CardRatings.com to view the best rated credit cards!
Guest: JoyJoy
Credit Expert (100+ Posts)
Posted: Sat Sep 16, 2006 10:24 am
Bikshu,
Thank you for all of the information you have shared in this post. I found it very valuable; I even understand better your point regarding the "bloody access checks".
JoyJoy
_________________
J~J
"You may never know what results come from your action. But if you do nothing, there will be no result." Mahatma Gandhi
CardRatings.com is the most comprehensive source for comparing credit card offers. Please visit CardRatings.com to view the best rated credit cards!
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