Unlocking Credit Potential: How AI Legalese Decoder Clarifies AMEX Overpayment and Temporary Limit Increases
- July 29, 2024
- Posted by: legaleseblogger
- Category: Related News
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Understanding Credit Card Limits
When it comes to credit cards, understanding your credit limit is crucial. Let’s say your credit limit is currently set at $10,000. In this scenario, you have your eyes on a luxury item—specifically, a stunning watch priced at $15,000. This raises the question: Can you make a payment of $5,000 towards your credit card balance to effectively increase your available limit, allowing you to make that purchase?
Payment Implications on Credit Limit
Making a $5,000 payment will indeed reduce your outstanding balance on the credit card. However, it’s essential to clarify how credit limits work. Credit limits are predetermined by the issuing bank, and they typically do not automatically adjust based on your account activity, such as payments made. Simply making a payment does not directly increase your credit limit; rather, it just increases the available balance you can currently use.
For example, if you make a $5,000 payment and you have already utilized $10,000 of your credit limit, the available balance will then be $5,000 post-payment. While you could use this to partially fund the watch purchase, it still wouldn’t allow you to surpass the initial credit limit to cover the total cost of $15,000.
Exploring Other Options
In order to make that lucrative $15,000 watch purchase, you may need to consider alternative options. One option could be to request a temporary credit limit increase from your credit card issuer. Many banks are willing to accommodate such requests, especially if you have a solid payment history and a good credit score. It’s worth making that call and explaining your situation.
How AI Legalese Decoder Can Assist
Navigating the complexities of credit card agreements and understanding your rights can be daunting. This is where the AI Legalese Decoder comes into play. It can help you fully comprehend the terms and conditions surrounding your credit card. The tool can take the often convoluted legal language found in credit agreements and decode it into simple, understandable terms.
By utilizing the AI Legalese Decoder, you can gain insights into what to expect when dealing with payment policies, credit limit adjustments, and any associated fees. This knowledge empowers you to make informed decisions regarding your finances, especially when considering significant purchases like luxury items.
Conclusion
In conclusion, while making a $5,000 payment towards your credit card can provide more available credit, it won’t allow you to exceed your established credit limit of $10,000 for that $15,000 watch. Exploring options for a limit increase or utilizing resources like AI Legalese Decoder can help you better navigate the intricacies of credit card usage, ensuring that you’re well-prepared for future financial decisions. Understanding these nuances can ultimately lead to smarter financial choices.
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Not based on knowledge with AMEX but have done similar things with ASB Visa Credit.
Not in the exactly the same way you can with a bank issued credit card but you kind of can. Essentially AMEX is not a licenced deposit taker in NZ so they need to have clear processes and procedures for managing credit balances which normally involves refunding a credit balance back to the customer. However until their process kicks in it will act as a increased limit but there is no guarantees for how long (depends how efficient or automated their credit management process is). NZ Bank issued credit cards have a lot more leeway because they are registered deposit takers. If you are doing a one off transaction you likely can use this approach, If you are thinking of doing it for a holiday it wouldn’t be that great (you’d be better off making payments on actual expenditure during the trip).
In my personal experience, no (this time last year).
I was planning on putting a holiday through my Amex Airpoints Plat for the airpoints and travel insurance offered by the card and topped up the full cost of the trip before making the transaction. The transaction itself was over the limit and the card declined, even being in credit 10k.
Spoke with them on the phone about it and they said something about AML laws and not being registered as a bank in NZ so they can’t hold credit like standard banks can. Sounded like generic CSR jargon but but I managed to pay for the trip in installments through the travel agent.
Their policy on it may have changed since last year but you may need to pay in installments and clear the balance after every transaction like I had to.
I asked AMEX support this question last year when booking flights for Europe. They basically said no, but I did it anyway (by that I mean I’d already transferred the money to top up the card) and it worked fine. No real issues or problems.
Not sure specifically on Amex but you can with other credit cards – I just did exactly this to pay for a flight that was above my usual limit.
You need to check your spending power. I tried this with some expensive flights one time and even though I’d put more than enough to cover the flights it didn’t work. When I spoke to them they said it is because it was over my “spending power”. I believe you can check this on the app.
What watch you getting?
If Amex isn’t a deposit taking bank, they will ask you to keep your card within its limit and not in credit. They will get in trouble if you use it like a bank account because they aren’t entitled to offer those services . Or something like that.
Source bank/FMA
Earlier this year, I topped up > 1k over my limit and it went through fine. I’m not too sure if the same will apply if you are increasing the limit by 5k however.
It definitely works for other credit cards from your bank.
Yes it definitely works, done many times over the last couple of years without a hitch ever, including 10-15k over the “limit”
I did this with my visa platinum. We had $11k to spend on appliances, our card limit is $8k, so we transferred the funds prior to the payment and picked up the rewards on the whole purchase.
But like others say, mine is a bank-issued credit facility. Amex is a whole other kind of setup
Two payments maybe? Pay a 5k deposit on the watch with your Amex, pay it back, then pay the rest?
I’ve been able to do this in the past. I’m surprised by so many comments saying you can’t.
You should be able to at least do this in 2 transactions.
I wanted to buy a car using credit card to get airpoints (part of negotiation was no merchant fees).
Limit was $15k. Car was $30k. So just put it in credit $15k and did it in 2 transactions
I called AMEX before to check if I could do this as I wanted to buy something 2k over my credit limit and I was given a flat no. I think it’s just a few hundreds over the limit, it might go thru – I got a negative credit available just recenty.
I have done this with Amex before, however by that same token you can pay for whatever you are paying in a split payment part by cash part by card ?
Yes this is precisely the advise by I was given by the AMEX helpline to order some tickets for Tokyo. It was quicker to top up the card than request for approval to increase my limit
Yes, you can. You can also give them a call and request a higher limit. You may want to evaluate if a platinum charge card provides better use for you (no limit).
Like most others mentioned here, probably not with Amex. I tried to do that with my ANZ airpoints platinum card and it was fine.
Last year I wanted to buy a $65k car via my Amex by putting in a cash deposit/top up on it first. The dealer agreed to let me use it with a 2.5% surcharge too but from memory, Amex said it wouldn’t work unless that was my credit limit.
You are not increasing the limit, you are increasing available spend, so yes of course you can. They would like you to
Yes you can/ have never tried to put it 5k in credit but 1k definitely works no issues