Credit & Companies.

jon142

Hello All,

Just got a quick question for everyone...

I have a debt of £10,000 owed to COMPANY A on a credit card.

I want to transfer this £10K from Company A to Company B.

Company B credit check and see the 10K, I know need to be earning at least (40k) to have any chance of getting another card @ 10K.

Why don't companies simply... In the application section that gives them the ability to transfer the debt to COMPANY B and COMPANY A are immediately paid off and the account is blocked from the customer from using the card?

This means I only have the be earning 20k instead of 40k to them close the card.

Does anyone follow? or am I just being immature.

Regards,
A

zerog

jon142 wrote: »

Hello All,

Just got a quick question for everyone...

I have a debt of £10,000 owed to COMPANY A on a credit card.

I want to transfer this £10K from Company A to Company B.

Company B credit check and see the 10K, I know need to be earning at least (40k) to have any chance of getting another card @ 10K.

Why don't companies simply... In the application section that gives them the ability to transfer the debt to COMPANY B and COMPANY A are immediately paid off and the account is blocked from the customer from using the card?

This means I only have the be earning 20k instead of 40k to them close the card.

Does anyone follow? or am I just being immature.

Regards,
A

Why would company B suddenly want to be owed £10000, unless they thought they had a good chance of making some money of it? Unless you work as an underwriter, how do you know that 40K will get you a 10K limit at company B?

dalesrider

Are we talking balance transfers between diffrent credit cards here?

Because if we are not. I'm lost....


Just because you do a balance transfer, does not mean they will close the old credit card.
Although that would be a great idea to stop people getting deeper and deeper into debt.

InsideInsurance

dalesrider wrote: »

Just because you do a balance transfer, does not mean they will close the old credit card.
Although that would be a great idea to stop people getting deeper and deeper into debt.

That is their suggestion plus the idea that the new provider will ignore the available credit on the other card when trying to make the decision on if to accept or not.

Whilst it is an idea the problem is that it would require company A and B to talk to each other before hand to ensure company A is willing to close down the account, what the exact balance is and a way to transfer future payments to the new card.

You are then getting close to the idea of portable card numbers ie you switch providers not cards, and that has the same problems that were discussed the other day when talking about portable bank account details.

The main crux of it is you are talking a massive IT and compliance project to deliver it across a large number of competitors to deliver something that gives none of them a competitive edge over the next one.

A simply implementation would work based purely on the CRA data because they are only updated monthly and also providers will allow people to go over their limits. So Company B could see you had £10,000 limit and a balance of £8,506 and accept on that basis but you may have updated it just 2 weeks ago and so its actually a £15,000 limit and after a bit of heavy spending the balance is £16,021

jon142

dalesrider wrote: »

Are we talking balance transfers between diffrent credit cards here?

Because if we are not. I'm lost....


Just because you do a balance transfer, does not mean they will close the old credit card.
Although that would be a great idea to stop people getting deeper and deeper into debt.

That is my idea, its for Balance Transfers only!

The idea is to close cards down instead of someone getting a 10k & a 10K which would be 20K.

YorkshireBoy

jon142 wrote: »

This means I only have the be earning 20k instead of 40k

Even without existing facilities/debt, to get a £10K limit on a credit card you'll need to be earning far more than £20K/annum, which is well below average earnings (of £27K?) these days.

There may be a few 'irresponsible' exceptions (eg your main bank receiving your salary, and for many years at that), but your assumptions about affordability and 'available credit/salary' ratios are way out!

jon142

YorkshireBoy wrote: »

Even without existing facilities/debt, to get a £10K limit on a credit card you'll need to be earning far more than £20K/annum, which is well below average earnings (of £27K?) these days.

There may be a few 'irresponsible' exceptions (eg your main bank receiving your salary, and for many years at that), but your assumptions about affordability and 'available credit/salary' ratios are way out!

I was under the impression you could lend " 50% " of salery depending on personal circumstances.

For example 40K you could lend 20K unsecured debt ( loans, creditcards, overdrafts ) before the rejections start coming!

YorkshireBoy

jon142 wrote: »

I was under the impression you could lend " 50% " of salery depending on personal circumstances.

For example 40K you could lend 20K unsecured debt ( loans, creditcards, overdrafts ) before the rejections start coming!

The 50% figure is often spouted on here as the maximum 'used credit/salary' ratio lenders will tolerate, before declining or offering very low credit limits.

I'm not aware its anything other than guesswork, perhaps based on a little anecdotal evidence.

Whilst you may get accepted for another card, no responsible lender will be willing to double your available credit in an instant. Let's face it, people don't always close down the other facility (indeed, many simply rack up debt again)...and if they did we wouldn't need a 'debt-free wannabe' board!

dalesrider

YorkshireBoy wrote: »

Even without existing facilities/debt, to get a £10K limit on a credit card you'll need to be earning far more than £20K/annum, which is well below average earnings (of £27K?) these days.
!

Well lets see 5 years ago I had over 10K from MBNA despite only earning just over 13K. As well as a couple of other cards....:eek:

guesswho2000

dalesrider wrote: »

Well lets see 5 years ago I had over 10K from MBNA despite only earning just over 13K. As well as a couple of other cards....:eek:

But were you given that as a starting limit or did it get increased to that over time? Very different stories, over time they have a better idea of your habits/ability to repay. A high starting limit on a low salary is less likely.

dalesrider

Over time.