Credit Report for Credit Card with No Preset Limit (pay, rate, deposit)

[Mjames]

I have a Chase Mileage Plus Visa credit card. When I reviewed my free credit reports, I noticed none of the 3 credit reporting agencies were showing a credit limit for this card. All of them were reporting the limit as zero or NA.

I contacted Chase and requested they report the actual limit and following is their response:

"Our records indicate this account is a No Preset Spending
Limit account (NPSL). Therefore, there is no credit limit
associated with the account nor was one determined when it
was originally approved. Instead, a credit access line is
assigned, which is the amount that the Cardmember has
available to use.

An NPSL account is reported to the credit bureaus without
a credit line. As a result, the account appears as an open
line of credit as opposed to a revolving credit card. An
NPSL account allows spending over the credit access line
without charging an over-limit fee. The overlimit amount
allowed is reviewed regularly and is based on credit
information, account history, and personal spending
patterns.

Since some credit bureaus may choose to report a credit
limit, it may appear that you are exceeding your credit
access line. Please keep a copy of this e-mail so that any
potential creditors can be made aware that your account is
an NPSL account."

I do not carry a balance on this card (or any cards) and the credit reporting agencies all show this credit card account as revolving.

So, I am wondering how this credit card impacts my credit score? I typically charge about $1,000 - $1,500 on this card per month.

If the way this card is reported harms my credit score, what steps should I take to correct the issue?

Thanks!!!!

[old_cold]

Good question.
I'm sitting here with an offer to upgrade one card to an NPSL but see little advantage to it (other than an attempt to suck us into taking out an even higher than currently allowed cash advance at disastrous rates.)

[berdee]

Actually those types of accounts can be helpful, if you already have high credit limits on other cards.
If you are building or rebuilding credit then they won't be much help in the beginning.

Those types generally report only the high balance, other creditors will not have a clue as to your real credit limit. That can be a plus.
If you are applying for a type of loan and the loan lender cannot see the credit limit then you probably won't get the "you have to much available debt" response. Some lenders mistakenly believe available credit is debt

The other good thing about those types of accounts is in the way they report. They don't report like regular credit cards do, as installment, they report as open. Some types may report as installment or flex spending.
By reporting as open, FICO ignores them as far as utility is concerned.

Those types of cards, and how FICO treats them, can almost be considered hidden accounts. Not full fledged hidden accounts but almost like the step child of hidden accounts.

If you are building or rebuilding there are ways to show a one time higher balance over your normal monthly spending, though those ways are semi risky.

For example,
Do a balance transfer to your bank account and then pay the transfer off after the statement cuts. Problems could be if the balance transfer has fees and also if the creditor will allow the balance transfer to be deposited to your bank account while considering it as a balance transfer and not a cash advance.

Make a large purchase right before Chase reports. Then after it reports return the purchase and pay the card off. The problems with that is, timing the reporting with making the purchase and being absolutely positive that you will be allowed by the merchant to return what you had purchased with no problems and with no fees.

Order coins from the Mint, then cash them in at the bank and pay off the card. The downside, depending on the Mint to ship in a timely manner (which they usually do), lugging all of those coins to the bank, making sure everything happens within the statement period so no interest will be charged.

Pay every bill with the card. Mortgage, utilities, car loan, etc. Just be sure that paying with a credit card does not incur a fee.

As I already stated, those ways do carry risks.

Never, ever do a cash advance with any credit card you want to keep.
If you must do a cash advance, use a crap card that you don't care if the interest rate is jacked or the account is closed.

[suzie02]

I got one of those cards too and I was wondering how do they affect credit score.
Would the available balance used in the calculation be the highest past balance? Or is it ignored all together?

[berdee]

Originally Posted by suzie02

I got one of those cards too and I was wondering how do they affect credit score.
Would the available balance used in the calculation be the highest past balance? Or is it ignored all together?

Basically FICO ignores the utility on those types of cards.

If you are dealing with a creditor that prefers to use their own internal scoring method, Amex for example, then they may factor the utilization from that card in.

In those cases, your highest balance ever on the card would be what they would look at as your credit limit.

For example, if the first time you use the card was for a $1500 purchase and every purchase after that was $1500 or below, then it would look like $1500 is the credit limit on the card.
Then a year later you make a purchase for $1550, your faux credit limit would then look like it is $1550.
It will stay that way until you make a purchase for more than $1550.

[Mjames]

Thanks for all the responses and information.

I contacted the credit card company again and requested they report the account to the 3 credit reporting agencies as an "open" account instead of as a revolving account and they said they would do this.

I'm not rebuilding my credit or trying to build it, so I don't think I need to do anything else except ensure the information on my credit reports is correct. My high balance on this card was about $15,000 a year ago, which was paid off right away. In fact, I carry no credit card debt, so its important to me that my credit scoring reflect the reality of low utilization of my available credit.

Thanks again!

[berdee]

Originally Posted by Mjames

Thanks for all the responses and information.

I contacted the credit card company again and requested they report the account to the 3 credit reporting agencies as an "open" account instead of as a revolving account and they said they would do this.

I'm not rebuilding my credit or trying to build it, so I don't think I need to do anything else except ensure the information on my credit reports is correct. My high balance on this card was about $15,000 a year ago, which was paid off right away. In fact, I carry no credit card debt, so its important to me that my credit scoring reflect the reality of low utilization of my available credit.

Thanks again!

Congrat's on getting them to report it as open.

That's a good example of - if you cannot get what you want from one CSR, try again with another.

You probably will see a good rise in your FICO's once it starts reporting that way.

[schweet]

I have been going through a similar situation and I'm glad that I came across this thread -- I'll be contacting my CC company to ask them to report it. Hope it works out like it did for you!

[Mjames]

Originally Posted by berdee

Congrat's on getting them to report it as open.

That's a good example of - if you cannot get what you want from one CSR, try again with another.

You probably will see a good rise in your FICO's once it starts reporting that way.

New twist!

Received another "secure" message from Chase which said:

"we are unable to report this
revolving account as an open line of credit."

This contradicted their other reply, so I called them and spoke with a manager. She said the account must be reported as a revolving account, even though she said Chase considers it an open line of credit with no pre-set limit. Additionally, she said they cannot report a credit limit to the credit bureaus and she understands the way Chase reports it can harm my credit score.

Since I don't feel like dealing with this anymore, I'm going to get another credit card with USAA that has an actual credit limit and have my bills that are charged to the Chase Visa charge to this new card. Then I will cancel the Chase Visa.

The only reason I kept the Chase Visa was to get United frequent flier miles and that is no longer a concern for me. My days of extensive business travel will end in about 6 months anyway, so I'll stop accrueing lots of United miles (in the past 2 years, my family and I have saved over $10K on flights using my frequent flier miles).

Truthfully, I think this was a minor issue, but since Chase won't solve it, I will!

[berdee]

I'm sorry they backed out of their agreement.

I don't have any USAA products but I know they have some very good products and people do seem to be happy them.


Just a suggestion, you might let the Chase card sit as it is and use it every couple of months to keep it active, or, you might consider converting it to another Chase product. One that does report the credit limit.
When converting cards you will retain the full history of the card you had converted from. The new card should show as being opened from the same open date as the card you had converted from.
That way you will still have the history and you will have a credit limit reporting. (just make sure you would be asking to convert not to combine)

If your credit is already established and you have large credit limits, if it were me I would let it sit as it is for a couple reasons.
1. The credit crunch is not over and it still looks like it will get worse before it gets better as far as account closures or limits being cut. You may still have that to fall back on should anything happen to your other accounts.
2. That card, as I'd mentioned before, is a step away from being a hidden account. When a person has a number of accounts with healthy credit limits then having a hidden account, or partially hidden, can be helpful.