on what grounds can credit card companies withdraw credit and demand immediate repay-

chattychappy

Eonel wrote: »

In practice, Credit Card accounts tend not to be closed unless there is a breach of the agreement.

However, I tried to answer the OPs question in the broadest sense - and I would maintain that a credit card account can be closed by either party for any reason.

The T&Cs I quoted were genuine. Another sample below from Nationwide - the wording is not as onerous, but the effect is the same :

14. Closing your account
[FONT=Verdana,Verdana][FONT=Verdana,Verdana](a) At any time during this agreement either you or we can close your account by telling the other. We will give you reasonable notice before we do so.
(b) If your account is closed you must return all the cards we have issued on your account, cut in two, and repay everything you owe us under this agreement.

http://www.nationwide.co.uk/NR/rdonlyres/537363B6-1FD8-4521-AE0E-CEBF458F663E/0/P4433_OCT07.PDF

[/FONT][/FONT]

Yes, interesting. They don't say in 14(b) when the balance must be repaid, only that it must be repaid. My interpretation is that it would therefore have to be paid off in a reasonable time. What is reasonable would depend on circumstances. If the bank was pulling out of the CC business, then what is reasonable would be longer than what it would be if you had borrowed in breach of the T+Cs and this prompted the closure.

chattychappy

gb12345 wrote: »

If that really isn't an option then how about looking at somewhere like Regus where you can rent office space by the day and spend a few days in the office and the rest of the week at home.

Going off topic, but Regus is about as expensive as it comes. Agree with the idea, but there are many smaller private operators that will offer serviced offices, even by the day. Not so easy to find, perhaps.

Actually I've always been suspicious of companies that want to meet me in Regus-like places. Smacks of here-today, gone-tomorrow startups/fantasy chasers/start-up capital burners.

cookyy2k

chattychappy wrote: »

Yes, interesting. They don't say in 14(b) when the balance must be repaid, only that it must be repaid. My interpretation is that it would therefore have to be paid off in a reasonable time. What is reasonable would depend on circumstances. If the bank was pulling out of the CC business, then what is reasonable would be longer than what it would be if you had borrowed in breach of the T+Cs and this prompted the closure.

I had a ccd withdrawn about 6 years ago simply because the company had been redoing credit checks (in their T&Cs they said they could do one at any time) and decided I had become too risky, they converted it into a loan with fixed monthly repayments and about half the interest rate which wasn't to be complained about. Took about 6 months to pay off in full.

chattychappy

Out of interest cookyy2k, do you remember what your T+Cs said about this situation?

londonTiger

dalesrider wrote: »

But what the OP proposes to use the CC for would be such a breech.
Ie. using a personal CC for business.
Or more to the point as a loan to set one up.

Clearly not the intended use of a personal credit card.

they really wouldn't be able to tell that I'm using it for business. The transactions would be for things like furnishings (from ikea) and IT equipment which the CC would not be able to say whether for certain or not the amount is being spent for business purposes.

londonTiger

cookyy2k wrote: »

I had a ccd withdrawn about 6 years ago simply because the company had been redoing credit checks (in their T&Cs they said they could do one at any time) and decided I had become too risky, they converted it into a loan with fixed monthly repayments and about half the interest rate which wasn't to be complained about. Took about 6 months to pay off in full.

do you know rouhly how much you were borrowing before getting the CC and how much you were borrowing when the company recalled it's lines of credit?

jamesml

Firstly, as said, if the absolute worst came to worst, you would repay it out of your savings, so its not like you are talking about any serious financial trouble.

Secondly, an easy (at least partial) alternative would be to buy all your personal shopping/daily spending etc on your credit card and buy your business property out of your current account. Keep track of what you spend and just ensure that the two are equal (£6k might be a bit much in personal exp. depending on your circumstances - like you said if its a real concern to you then put the stuff like laptop or ikea products which could be personal items on the cc and balance the rest).

Lastly, I would have to agree that I'd be hesitant to use a temporary office space. I'd say its expensive for it is. How long have you been freelancing from home for? Is it an established business? I know several people who have bought log cabins for the garden, which are really effective.

cookyy2k

londonTiger wrote: »

do you know rouhly how much you were borrowing before getting the CC and how much you were borrowing when the company recalled it's lines of credit?

Before I got it next to nothing, I got into some trouble and had to dip into it for a "rainy day", I ran it to within 5% of its limit and held it there for 3 months only paying minimum each month, apparently that tripped some sort of check(?) didn't look too much into it because apart from being young and naive they were quite pleasant to deal with and gave me a very reasonable rate of interest to pay it back to them, around 6% because they were the ones ending the agreement. Also nothing was ever placed on my credit file other than on time payments and then the account closing, nothing negative.

chattychappy wrote: »

Out of interest cookyy2k, do you remember what your T+Cs said about this situation?

I don't remember no, something along the lines of they could re-evaluate your situation periodically. When I tripped one of these re-evaluations they withdrew it and gave me a payment plan.

chattychappy

cookyy2k wrote: »

they were quite pleasant to deal with and gave me a very reasonable rate of interest to pay it back to them, around 6% because they were the ones ending the agreement. Also nothing was ever placed on my credit file other than on time payments and then the account closing, nothing negative..

I think you did very well!

londonTiger

cookyy2k wrote: »

Before I got it next to nothing, I got into some trouble and had to dip into it for a "rainy day", I ran it to within 5% of its limit and held it there for 3 months only paying minimum each month, apparently that tripped some sort of check(?) didn't look too much into it because apart from being young and naive they were quite pleasant to deal with and gave me a very reasonable rate of interest to pay it back to them, around 6% because they were the ones ending the agreement. Also nothing was ever placed on my credit file other than on time payments and then the account closing, nothing negative.



I don't remember no, something along the lines of they could re-evaluate your situation periodically. When I tripped one of these re-evaluations they withdrew it and gave me a payment plan.

Thanks fort he reply. I don't intend to max out the free amount. I did that with some student 0% internet overdraft services and got quite a few letters from HSBC notifying m,e what the overdraft is meant for and what it is not meant to do.

But banks are nice to students. Because they know that during the student years if they create brand loyalty - that customer will remain loyal for life, advance to the graduate account - get a mortgage from them etc.

To this day I keep my main income source with HSBC and I've left the HSBC credit card active. When I've pretty much cancelled all other cards after I rinse out the 0% period. So it does work.

Anyway. What I think would be safest to do is stay below 50% of the CC limit and pay in more than the minimum. Like double the minimum amount. Keep them happy. and not suspicious.