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Should we run up credit before they pull it?

Discussion in 'General Signmaking Topics' started by Andy D, Apr 16, 2020.

  1. Andy D

    Andy D Very Active Member

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    I have no concrete info, but if the economy continues to go south, I think any credit most individuals and small shops have, will disappear...
    Right now I'm putting most stuff on credit and keeping as much $$$ in my checking and "under the mattress", just
    in-case, paying the minimum.
    I know that will sound sketchy to some, but I'm sick of the government just looking out for banks & other large corporations...
    Just a thought to keep your business and/or family afloat....
     
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  2. Christian @ 2CT Media

    Christian @ 2CT Media Major Contributor

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    I think the interest accrual in the mentality will be crippling if it doesn't go the way you plan.
     
  3. Texas_Signmaker

    Texas_Signmaker Very Active Signmaker

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    Doing that WILL be a tip-off to credit card issuers and they very well could go ahead and limit your account and shut it off. They have computer algorithms that sound alarm bells when someone has irregular charge patterns. Having high "ratios" of credit available VS credit used will cause your credit score to tank. That lowering credit score will also tip-off issuers that you might be in trouble.

    You want to use less than 10% of your available credit at any time. Going over 30% is a red flag.

    That and the interest rate on CC's are crazy.

    Only reason I could think of saying "Ok, do it" is if you had no other means of paying bills and you needed food and gas. At that point your credit will be shot for 7 years and you might risk lawsuits, but better to have food to eat then a nice credit score. That would be the absolute last option on your way to financial ruin.
     
  4. Christian @ 2CT Media

    Christian @ 2CT Media Major Contributor

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    That's not entirely true with Business credit cards, they want you to use available credit... Every time we use more than 80% of our available credit on a consistent basis, Chase has increased our limits. But, the big but is, we pay off our card monthly or multiple times in a month. The past 4 months we have maxed out credit cards out 6 times due to projects and paid it off, we just got a notice that they have increased our limit 30%.
     
  5. Texas_Signmaker

    Texas_Signmaker Very Active Signmaker

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    Christian, you seem to love spreading around your misinformed view and you're just throwing **** at the wall and seeing what sticks. Maybe the slowdown has you spending too much time responding to every thread.

    High ratios negativity effect credit scores. Monthly charge volume can help justify larger limits. The smart move is to pay it off continuously throughout the month.. so as to keep the ratios down.
     
  6. Andy D

    Andy D Very Active Member

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    All good info and advice... As I have stated in a previous thread, I have been blessed to be able
    to own land, also my house and everything is paid for, but this pandemic has opened my eyes to the
    importance of becoming self sufficient & and I'm willing to spend money that I don't have to make that happen.

    If I did own my own business I would run up my credit to save cash flow to keep my business and/or family
    safe without a second thought.
     
    • Like Like x 3
  7. fresh

    fresh Very Active Member

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    i'm not doing anything nefarious with my credit cards. my lingering student loans? yeah, nah. All federal student loans are in automatic forbearance right now. People who are continuing to pay them, or using their stimulus money to pay them off, are nuts. I'd be soooooooo pissed if I paid a few thousand off while forgiveness/cancellation is looming and actually goes through.
     
    • Like Like x 1
  8. Texas_Signmaker

    Texas_Signmaker Very Active Signmaker

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    EXACTLY! I stopping paying on my wife's loans when they made that decision to auto forbearance.
     
  9. Notarealsignguy

    Notarealsignguy Active Member

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    My wife just paid hers off a few months ago. Figures.
    I dont think they will yank current credit lines but you never know I guess. Not sure on credit cards but on loans and lines of credit, they absolutly watch for any signs of financial deterioration. All loans can be called because of this and if you look at the terms on the PPP, its in there too. This happens more than you think, banks go in to secure assets to get their money and force liquidation.
     
  10. Johnny Best

    Johnny Best Very Active Member

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    And you were hoping Bernie Sanders would become president.
     
  11. Christian @ 2CT Media

    Christian @ 2CT Media Major Contributor

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    I have a $300,000 credit limit across my two business cards and we max it out on the regular, I also regularly peak my personal cards over 50% and have a 785 credit score... We use our card for everything and we never carry a balance. It's not misinformation it's called credit manipulation. There is a game to it!
    I also max out my points growth and have had over 7 million points so far in the last 9 years on my Chase cards.
    We fortunately are not slow, in fact we are back to better than before and looking at hiring.
     
    • I Appreciate You I Appreciate You x 1
  12. James Burke

    James Burke Being a grandpa is more fun than working

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    Contrary to the late-night radio infomercials, you really do have to pay back what your borrow. Either pay them...or pay hell for the rest of your life.

    Bankruptcy has yet to become viable business model.


    JB
     
  13. Christian @ 2CT Media

    Christian @ 2CT Media Major Contributor

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    And before you say anything, my brother and I have also donated over $2000 of signs to our local neighboring businesses to help them get by, and are on track to do 10,000 graduation signs for school students for the various districts at a loss to help our community. We aren't just greed we want our small business bretheren to grow with us.
     
  14. Notarealsignguy

    Notarealsignguy Active Member

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    We have 200k line of credit and a couple of credit cards. We never touch it ever. Why continually max out credit cards to finance jobs? This is the sort of thing that gets people in trouble. What happens now when someone goes belly up and you are carrying this high interest balance? Almost sounds like youre paying for current jobs with future money and that doesnt end well.
    785 is good but its nothing to write home about either.
     
  15. Texas_Signmaker

    Texas_Signmaker Very Active Signmaker

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    Maybe you have 785 because you have higher ratios....
     
  16. rydods

    rydods Member

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    We're looking at investing in some of the companies that have taken the hardest hits but will definitely be bailed out if needed and will more than likely gain significantly once this clears up.
     
  17. Jeremiah

    Jeremiah Member

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    I just do what my grandparents taught me. Stay true to your word. Do the right thing. I will survive.
     
  18. brycesteiner

    brycesteiner Member

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    We had something similar happen when we got close to the limit. I looked the other day and our credit limit on one card is about $40,000 now. We started at 8000 several years ago.
     
  19. Texas_Signmaker

    Texas_Signmaker Very Active Signmaker

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    Since you are doing better than before, do you think it was right for you to apply AND RECEIVE funds from the PPP when there are a TON of small businesses out there that really need the money and need to keep their employees on the payroll?
     
  20. Jeremiah

    Jeremiah Member

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    My statement is not directed at anyone in here...... I was reading an internet article yesterday that brought up a lot of fraud , false statements , and scams by people who had applied for and got money from the banks. They mentioned how easy it was to get money . Just made me shake my head .
     
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