What do the banks really think of churners.

[Mr H]

I do around 6 to 7 cards per year (sometimes a little more and sometimes a little less). I'd probably be considered a high frequency churner and then I'm sure there are a few that go through more cards per year.

I have one Visa card that I have operated for two and a half years linked to my retail bank. I have no plans to close it. I have opened seven new cards in the past 12 months (and about to apply for my eighth). I have closed six of them and will probably close the Amex once I have converted MRs to KrisFlyer in February - although the earn rate with Amex is so good that it seems a pity. By my calculation, there are 10 cards worth churning but it is worth holding one as the daily transaction card.

 

[astroboyong]

I only hold amex for the past 4 years. and the rest, I always close on month 10/11.

So when you apply 6-7 cards, do you apply at the same time?
or even if it not the same time, do you hold all of it together?
or you close one first, then apply another one?

the reason I only hold 3 cards maximum at the same time, is I'm not 100% sure if they will approve the next one. As when we apply CC, they'll ask what cards are we holding and the limit

 

[Mr H]

So when you apply 6-7 cards, do you apply at the same time?
or even if it not the same time, do you hold all of it together?
or you close one first, then apply another one?

So far I have been holding only three at a time. I have been closing them as soon as the bonus points post.

 

[burmans]

I only hold amex for the past 4 years. and the rest, I always close on month 10/11.

So when you apply 6-7 cards, do you apply at the same time?
or even if it not the same time, do you hold all of it together?
or you close one first, then apply another one?

the reason I only hold 3 cards maximum at the same time, is I'm not 100% sure if they will approve the next one. As when we apply CC, they'll ask what cards are we holding and the limit

Credit providers can see all your current loans via the bureaus. As part of the Responsible Lending legislation that need to take this into account in lending to you. The higher your existing lending the less capacity you have to service a new loan.

In conclusion, reducing existing lending is a good thing for the assessment of servicing capacity when applying for a new CC so closing accounts you aren’t using will assist.

 

[GSP]

I only hold amex for the past 4 years. and the rest, I always close on month 10/11.

So when you apply 6-7 cards, do you apply at the same time?
or even if it not the same time, do you hold all of it together?
or you close one first, then apply another one?

the reason I only hold 3 cards maximum at the same time, is I'm not 100% sure if they will approve the next one. As when we apply CC, they'll ask what cards are we holding and the limit

My frequency is not really planned, just whatever is there at the time. I've applied for 2 or 3 at a time and received them all and sometimes go for a stint without applying.

I tend not to stick to a maximum # of cards at one time, but I don't think I've had more than 5 at a time, but in general, like you and others I always tend to hold two or three at a time. I do try to time my applications so that I apply when a card I have closed is off the credit bureaus records, which means watching for when a CC offer expires and allowing enough time to close, wait for the records to be updated and then apply.

 

[astroboyong]

My frequency is not really planned, just whatever is there at the time. I've applied for 2 or 3 at a time and received them all and sometimes go for a stint without applying.

I tend not to stick to a maximum # of cards at one time, but I don't think I've had more than 5 at a time, but in general, like you and others I always tend to hold two or three at a time. I do try to time my applications so that I apply when a card I have closed is off the credit bureaus records, which means watching for when a CC offer expires and allowing enough time to close, wait for the records to be updated and then apply.

do you know how long should we wait to apply after closing a card for the record to be updated?

 

[exceladdict]

do you know how long should we wait to apply after closing a card for the record to be updated?

In my experience it can be a month or two but you can check the free credit report services to see if it's updated on the various records.

 

[GSP]

do you know how long should we wait to apply after closing a card for the record to be updated?

Agree with @exceladdict it is up to two months, but generally with 3 to 4 weeks - I'm guessing it must be on a monthly reporting cycle.

Should add, that the date recorded is the actual date you close it, not the date they update their records.

I also find it useful as despite keeping my own records, it is good to refer to so as to ensure one has the correct data when waiting for a 12 month or 18 month exclusion period. Whatever records I may keep, that should be the one to refer to rather than getting into a bun fight over a few days if your records slightly differ.

Edit: spelling

 

[burmans]

Yes, they are required to report monthly, from memory by the 10th of the month.

 

[Mr H]

It had to happen, and today I got my first rejection - from Suncorp. I looked at my Equifax report and it says I have an excellent rating, no missed payments and my previous cards show as closed. It does have a flag for multiple applications in a short space of time, but the overall credit level including my mortgage is 3.25 times my income with no dependents. I wonder whether this is just Suncorp (I can't find much info on others' experience with them) or whether it is a sign that one round of the all the cc providers is enough.

 

[Scr77]

It had to happen, and today I got my first rejection - from Suncorp. I looked at my Equifax report and it says I have an excellent rating, no missed payments and my previous cards show as closed. It does have a flag for multiple applications in a short space of time, but the overall credit level including my mortgage is 3.25 times my income with no dependents. I wonder whether this is just Suncorp (I can't find much info on others' experience with them) or whether it is a sign that one round of the all the cc providers is enough.

Suncorp cards are issued by Citibank. For no apparent reason, I Can never get any card that is back by Citibank.

 

[MooTime]

Suncorp cards are issued by Citibank. For no apparent reason, I Can never get any card that is back by Citibank.

I too got knocked back by Citi bank some months ago. Maybe cos I already had a Citi issued card. Will try to avoid them next application.

 

[GSP]

Citibank don't always not back, but they are hit and miss. I'm well above 50% pass, but they are a lower average than other banks where I can't recall a rejection...actually one on thinking, Bankwest....although I had closed one of their products and perhaps moved too quickly onto another of their products.

So I think Bankwest are ones that don't like us churners.

Citibank are simply all over the place.

 

[Telezacski]

I’m new to the forum but not new to banking and I look at credit reports daily.

Reading the thread some of the old CRA rules are thought to be applied but their are changes as noted under new current credit reporting.

An application will stay on your credit file for five years as noted above. If the card is opened it will stay until closed, they don’t drop off.

Once closed they stay for the minimum reporting period of two years so all banks see two years of history on your payments.

Banks are required to report monthly but I’ve seen as much as a two month lag I.e reporting on January now.

What you see on a free report is not the same as what we see, that’s not to say it isn’t a good service, it’s just not the same.

Banks use automated credit reporting so as noted above they can easily tweak the algorithm to cut out churners if they wanted.

IMO where this discussion goes from black and white to very grey (and this has been touched on) is in quality of application and what you are applying for. I have seen applications auto decline for home loans due to volume of enquiries, most banks algorithms set a limit at number of credit enquiries per annum and whilst manual assessment can still over ride this, it requires extra steps.

So churning may not effect credit card applications but may effect other credit.

How limits are applied in servicing has also changed from 3% of the limit per month ($300on a $10k card) to 45% of the limit divided by $12 ($375 on $10k).

So churn away but my general recommendation is to know how and when to prepare for other applications

 

[exceladdict]

What you see on a free report is not the same as what we see, that’s not to say it isn’t a good service, it’s just not the same.

For reference, how do they differ? Getcreditscore/Creditsavvy/Creditsimple seem to be quite similar to past reports i've had from illion, equifax etc in terms of listing applications.

Is there information the bureaus hold on us that they're not sharing back? Or are you more referring to internal analyses of the data (eg, as you say, banks calculating an algorithm off the information we can see).

How limits are applied in servicing has also changed from 3% of the limit per month ($300on a $10k card) to 45% of the limit divided by $12 ($375 on $10k).

So churn away but my general recommendation is to know how and when to prepare for other applications

This is very interesting and helpful, thank you are sharing. I had a very 'closely examined' CC application recently. Based on limits I'd been granted in the past and my other ins and outs, I thought I was well in the clear.

Is there also a prescribed "buffer zone" i.e. if the person has only $375 spare at the end of the month - will they be granted 10k? Or must it only be up to a % of their remaining monthly income after expenses?

 

[Telezacski]

For reference, how do they differ? Getcreditscore/Creditsavvy/Creditsimple seem to be quite similar to past reports i've had from illion, equifax etc in terms of listing applications.

Is there information the bureaus hold on us that they're not sharing back? Or are you more referring to internal analyses of the data (eg, as you say, banks calculating an algorithm off the information we can see).



This is very interesting and helpful, thank you are sharing. I had a very 'closely examined' CC application recently. Based on limits I'd been granted in the past and my other ins and outs, I thought I was well in the clear.

Is there also a prescribed "buffer zone" i.e. if the person has only $375 spare at the end of the month - will they be granted 10k? Or must it only be up to a % of their remaining monthly income after expenses?

may be easier to list what we see

- personal details
- address and employment details you have applied for credit with
- credit score as determined by the agency, with factors that they deem effect the score
- adverse history, defaults, court actions etc
- all credit enquiries
- all active credit facilities including an account identifier (not full number) recent balance and payment history, either closed, not reported, paid on time, paid in a month, 2 month’s and so on
- all associated ABN’s directorships or private company shareholdings

The information is similar to the free reports, the detail is greater.

In terms of buffers, I work more in home and business lending so can’t answer directly the buffer on cards. But home lending buffers will depend on the lender, the LVR and the debt to income (DTI ratio)

The most I’ve seen is $500 a month based on buffered assessment but the majority of lenders want $1

 

[exceladdict]

may be easier to list what we see

- personal details
- address and employment details you have applied for credit with
- credit score as determined by the agency, with factors that they deem effect the score
- adverse history, defaults, court actions etc
- all credit enquiries
- all active credit facilities including an account identifier (not full number) recent balance and payment history, either closed, not reported, paid on time paid in a month, 2 mo the and so on
- all associated ABN’s directorships or private company shareholdings

The information is similar to the free reports, the detail is greater.

In terms of buffers, I work more in home and business lending so can’t answer directly the buffer on cards. But home lending buffers will depend on the lender, the LVR and the debt to income (DTI ratio)

The most I’ve seen is $500 a month based on buffered assessment but the majority of lenders want $1

Very interesting, thanks for sharing.

 

[theblank]

Is there information the bureaus hold on us that they're not sharing back?

No. it would be unlawful for them to do that.

 

[Telezacski]

No. it would be unlawful for them to do that.

How would it be illegal?

I would have thought it would be pretty easy to hide behind the product T & C’s. You want a free product you get the basic version.

Honestly what I believe is illegal is the advertising for the various credit score companies. They imply a lot

 

[burmans]

The information that credit providers can provide to the bureaus is strictly limited by the Privacy Act, as is the requirement for the bureaus to disclose what they have been provided when asked.