Separate the financial institutions

[question everything]

It was never planned that way, but once we would move to a new place and open a checking account and then purchase a house, the mortgage would be with a different bank. And then a home equity loan would be yet with a third bank. Credit cards - VISA and MasterCard - also with different banks.

And while on occasions I would see the bank where we have our checking account offer competitive rates, I would stay clear of it.

Why? Because when we are employed, our paychecks are directly deposited into our checking account. Thus, if the bank wants to, or if it has an automatic monitoring system, it can tell when paychecks no longer are deposited. And we have been through too many periods of unemployment that I have become sensitive to who knows what about us.

All this is a very long introduction to my suspicion being confirmed.

A few days ago we signed on a new home equity loan and I actually read all the fine prints and came to the following:

"We can... reduce your credit limit during any period in which:

- We reasonable believe you will not be able to meet the repayment requirement due to a material change in your financial circumstances."

Thus, if our checking account, our credit cards and our mortgage are all with the same bank, it would notice that level of deposits has decreased, even disappeared, replaced with state unemployment checks; it will notice an increase activity in our credit cards with minimum payment and will correctly conclude that we lost our jobs. It would then make it harder on us to rely on credit cards by reducing the credit limit and, perhaps, even by increasing the rate of finance charge.

As long as the different banks do not buy each other, we will continue to keep different activities at different banks. Keep them in the dark.

[GraysonDave]

1. They all share info anyway

The better solution would be to use all cash, but that ain't easy these days.

[question everything]

2. I do fill those forms where I tell them not to

and, I suppose, if they don't, someone will find out and will sue them. I hope.

All cash is OK for small purchase but you cannot pay your mortgage with cash and few employers will pay with with cash.

Sure, many want to have all the payments automatic withdrawal from your checking account and I try to resist as much as I can.