Have you had any of your credit card limits lowered by your credit card companies? See the results of this poll.

[Anonymous]

Yes, one of my credit card company's lowered my limit by $2500.  The reason they gave me was I was not using my credit card so I did not need such a high credit amount.  I checked my credit report and found nothing wrong with it.  I am not to concerned about this, it does not appear to have affected my credit score.

[wmarat]

Not yet, even got some cli's. But, honestly, CCC are facing very tough time. They wrote off a few billions of $$ only in 2008 and probably will write off about 55B in year. Consumers curb their spending, unemployment, so I think at least CLD is inevitable.

[tonsers]

My limits have not been cut.  I'm not carrying a balance so I'm not worried about it yet.  However, I do have a big purchase coming up that I plan on paying off over a few months, and I do worry that my limits will be lowered then.

Message Edited by tonsers on 10-29-2008 09:08 AM

[cygnusdrache]

I'm glad I found this page - I am thoroughly miffed by this thing.  I got a letter today from GEMB (Old Navy) - they have lowered my limit to just above its current balance.  I have been trying hard to pay all of my bills every month, while making zero progress on reducing balances for nearly a year now, since I'm paying my doctor bills off before I get to anything else.  And my reward for working on it is to have my FICO score further reduced just because "they felt like it".  It was already in the tank as it is, now my debt to credit ratio is even worse, and my score is going to show another drop next month.  Lovely. 

That's what I get for trying to be responsible about my credit situation, when I went through and closed all my open credit lines that weren't in use my credit score dropped like a rock. Apparaently that was a bad idea in the world of FICO, so I discovered after the fact.

So, since GEMB lowered my credit limit, I canceled the account.  I'm going to do that with any other GEMB accounts I have as well - I know of at least one of them.  

[Anonymous]

Yes just one though?!?!  I guess it is because I had nothing owed on that acount but I had just paid it off the month before. I have had the account for 4 years always paid on time. Never late or missed. Had a credit limit of $5000.00 and it was reduced to $300.00!!!

When I called about it they said they had the right to make any adjustment they wanted to and there was nothing I could do about it. Their reply was so arrogant that I wanted to close the account but closing accounts has an effect on your credit score also. So I am just not using it and won't ever again. It was through Household Finance (HSBC).

The next month my FICO credit score went from 740 down to 650, I was shocked. I am current on all my bills. I do not ever pay late and pay more than required always.

I think this sucks!!!

[Anonymous]

Good ol' Amex got me just last week.  Cut my CL in half, but from the stories around here I can't complain to much.  I am waiting to see how much this effects my score and it will negatively.  I am paying everything off ASAP!!!!!!!!!!!!!  Good luck to everyone else in the same boat!

[Anonymous]

Looks like AMEX is on a credit lowering rampage.  I got a email notice yesterday that they were lowering my credit limit from 13m to 11m.  I have decent credit in low 700's and have not missed a payment ever.  I had just read in our local paper two days before about credit card companies lowering credit limits and increasing rates on good customers with good credit just because.  They said more explanation from AMEX would be coming in the mail.  The thing that gets me is I had never asked them to up my credit limit in the first place.

[Anonymous]

American Express is noted for doing this.  They lowered my limit and almost placed me overlimit with my charges.  I had nothing negative on my credit report.  I paid off my debt with them and won't use their card anymore.

[recoverychick]

No.  I'm not really concerned.  My utilization stay low these days.  I'm only buying what I need to and not so much what I want.

[l-bug]

I have to credit some of these thoughts to a message posted on another site, but it made a lot of sense to me from the bank's perspective.  As more and more people are losing jobs in this economy, they will rely more heavily on credit cards to meet their daily living needs. Then they get behind on their bills, so they will begin to use their credit cards even more, and then their credit score will start to decline. Then they lose their home, and credit scores plummet. By this time, they have maxed out their credit cards. They have nothing to lose by walking away from the credit card debt, leaving the ccc in the cold.

Even people who have paid their bills on time for years can lose their jobs and financially spiral downhill in a hurry. And if you have demonstrated to the ccc that you can accumulate a moderate to large balance on your cc (even if you have done it responsibly), you would probably run up a similar balance in desperate times.

So the ccc are simply limiting their future loss liabilities by preventing you from charging large balances by reducing your available credit. They are not concerned about your credit score, only the possibility that they may be left holding the empty money bag.

I believe, as well, that the types of purchases that you make on your cards will affect the swiftness of the credit line reduction.  For instance, do you charge often at Walmart (a prime source of household goods/necessities), the grocery store, the gas station, the pharmacy?  This would be red flag that you are having a tough time paying cash/debit for life's basic necessities.  Especially if you are not paying pretty much in full at the end of each month.  So if you are barely making it now, what happens if the economy gets worse? More charges. More possible losses for the ccc. So especially when someone who has been paying off a balance for quite some time suddenly pays down a substantial amount, the ccc is going grab the money and run.

So this question comes to mind to those who have had their limits drastically reduced: what type of purchases have you made with your card--are they ones that would suggest that you are living paycheck-to-paycheck? Just curious if the two are correlated.

Small businesses, in particular, would probably be more at risk for credit limit reductions as more small business struggle to make ends meet. And many won't make it, but will have maxed their cards trying.