Use your card to pay a marriage counsellor? Marital trouble could indicate financial trouble ahead. Use it to pay for expensive repairs on your car or to have tires retreaded? That might suggest you don’t have the money to buy a new car, and may raise red flags about your money situation. Even shopping at discount stores like Wal-Mart and Zellers could be enough to spook some card companies.
Kevin Johnson, a 29-year-old Atlanta man with a spotless credit history, recently saw his credit line slashed by 65 per cent. He investigated and was told it was because he loaded up his card during his honeymoon and shopped in certain stores that American Express considers down-market. He has since become a consumer advocate, blogging about his battle with Amex at www.NewCreditRules.com. But it’s not clear exactly what can be done about financial profiling aside from alerting consumers that it’s happening.
We’re in the midst of an unprecedented credit crunch, combined with a deep recession, and Canada is in it just as deeply as the U.S. is. Credit companies lent like fools for years and are now madly scrambling to cope with the consequences. They have to reduce their risk, or this crisis could drag on for years, and that means even responsible borrowers are going to be caught up in their new era of austerity and caution.
The world just got a lot less trusting, even here in “frugal Canada.”
Pages: 1 2
