How to Avoid a Financial Review from American Express

What leads to an American Express financial review? I've talked about my experience with a financial review in the past. 

What is a financial review?

A financial review is a risk minimization tactic by Amex to make sure you don't max out your cards and run away. Their goal is that you don't default on payments by having too much debt and not pay it off.

When you're under financial review, they'll freeze all of your accounts, and you'll need to send in documents about your income. They will request tax returns and bank statements. What they're looking for is to make sure the income you reported on the application is true.

The process typically takes 2-3 weeks, and you're assigned a specialist to talk to. Even if you contact customer service, you will not be able to talk to anyone except for the specialist. 

If you don't send in the requested information, they will shut down all of your accounts. Even if you're worried about failing the review, you should still send in the documentation because they're going to either shut down the accounts or set a lower credit limit. 

What factors trigger a financial review?

Clicking the "Spending Power" button often

If you click the "spending power" button more than three times a day, it will trigger a financial review. The idea is if you have a big purchase coming up, you can check if the transaction will be approved.

For me, this is what triggered a review. I entered $20,000 and then $30,000 and $50,000. Surprisingly, they all said it would be approved. On Amex's side, this raised a red flag because I just received my chargecard. 

The lesson here is: Don't play with the "Spending Power" button.

Too many large purchases in a short time span

I think this is reasonable to prevent fraudulent transactions. One thing to be careful of is if you're hitting minimum spend. For example, if you're approved for a card, and you have a $10,000 credit limit, if you spend $5,000 in the first three days, it will raise a red flag. This equates to $2,500 a day, so they're going to assume this is normal behavior since they don't have spending history on your new card.

If you take the $2,500 and multiply it by 365 days, you get a figure close to $1 million dollars. This is concerning to Amex, especially if the income you reported isn't close to $1 million. 

High credit limits

If you have more than $25,000 credit limit on a credit card or a combined credit limit of $35,000, it will trigger a financial review. 

Return Payments

Amex allows you to link a bank account to pay your statement balance. If you don't have a balance in your bank account to pay the balance, it will result in a return payment. 

Changing income numbers

The final factor that leads to a financial review is if you change your income numbers too drastically. For example, if you apply with a $100,000 salary, and one year later, you have a $150,000 annual salary.

Amex may want to see proof of the salary increase in the form of a pay stub or tax return.  

Financial Review Outcomes

There are three possible outcomes to the financial review process:

1. Pass, everything checks out, and no further action is needed. 
2. Pass, but they will decrease your credit limits.
3. Fail, they will close all your accounts.