And the question is...

Chase vs. the FICO Score System

2009-07-07T12:59:00.003-05:00

Now that JP Morgan Chase has decided it can no longer afford to let consumers continue to have higher credit limits on their credit cards (even if they are very good consumers), Chase has been consistently lowering various consumer credit limits over the past few months.

When Chase was approached and asked about how negatively this will impact consumers that have excellent FICO scores, Chase has taken the position that perhaps it's time that the FICO score calculations should be adjusted. Therefore, I ask you, should FICO scores be adjusted because of a financial institution's poor cash management regarding its lending practices?

Is Bank of America Overdrawn?

2009-06-30T19:07:00.004-05:00

It was noticed that during Bank of America's overnight processing last night (June 29) that its overdraft protection feature didn't work correctly on several customers' checking and savings accounts...

For example, if your BofA checking account had a positive available balance and your overdraft protection was set up to transfer money from your savings account into your checking account in the event your checking account may be overdrawn, the BofA computer system took money (supposedly by mistake according to BofA) from your savings account and transferred it into your checking account. There was no justification given by BofA as to how this "accidental" amount was calculated by their system either! Thus, this left an even larger available balance in the customer's checking account, but dramatically lowered (or even possibly created a negative balance) in the customer's savings account.

It seems EXTREMELY ODD that this significant problem occurred at a time when Bank of America's account balances on June 30th will be used to calculate the new FDIC assessment on financially insured institutions. Thus, this type of error makes it appear as though BofA has more money available in its M1 than it genuinely does.

According to a Bank of America Representative earlier today, the account balance problems will be automatically corrected during overnight processing on June 30th; however, these corrections will be reflected in the opening balances on July 1...

Your thoughts? Does this appear to be accidental or planned??

Is old Bank One still calling the shots?

2009-06-29T18:48:00.004-05:00

In the early 90s, Bank One (aka First USA) gave credit card cash advances with extremely low interest rates "for the lifetime of the loan". Now, comes the down economy, and Chase has decided these interest rates (ranging from 2.9-5.9% annually) are too low. However, since Chase cannot increase these fixed interest rates, Chase is increasing the minimum monthly payments on these cash advances from the present monthly amount of 1% of the balance to 5% of the balance each month.

When Chase was asked about this, Chase is stating that they believe this significant increase HELPS the consumer to pay off their balances sooner. What happens to the consumer when the consumer was making a profit by cash advancing the money and placing it into another investment that made a greater annual rate of return?

It looks as though Chase is trying to self-justify getting their money back into their coffers sooner. Aren't these large monthly payments actually hurting the consumers instead, especially on their credit scores and in their monthly discretionary income levels?

Are Americans really saving more these days?

2009-06-26T07:32:00.004-05:00

It has been documented recently that Americans are "saving" more than they have during the past 10 years. Is this really true or are Americans just maximizing their credit cards and other lines of credit in an attempt to still have money available when the financial institutions chop down their available credit?