Well, I guess the credit insanity had to end sometime. One of the areas where logic seemed to go out the window long ago was with respect to credit cards. For a long time it seemed like there were at least five pre-approved offers in the mail every day. But perhaps the fun is now over.
An article from the Wall Street Journal last week talked about how credit card companies are tightening their standards up a little bit. The card companies seem to be reacting to the current situation differently, but here are the highlights:
- American Express – AMEX is getting tougher on credit limit increase request and is reviewing credit lines when spending changes are noted.
- Bank of America – Getting tougher in small business lending, as well as reviewing current credit card limits and open lines of credit.
- Capital One – Tightening standards and increasing collection activity.
- Citi – Tightening standards and raising credit score requirements; also evaluating open lines and considering other customer accounts with the bank.
- Chase – Cutting back offers to customers they refer to as “gamers” who transfer balances to take advantage of low balance transfer rates.
- WaMu – Cutting back direct mail offers to concentrate on current bank customers.
Seeing that many issuers are considering changing limits and terms on current customers, you can see the wisdom in keeping open large lines for different issuers. That way if one issuer starts with any shenanigans you have a safety net.