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$20k CLD from Capital One

Community Leader
Super Contributor

Re: $20k CLD from Capital One


happypill wrote:

CreditCuriousity wrote:

BrutalBodyShots wrote:

bodeh6 wrote:

My CO QS was decreased from 16K to 10K last week. 800-820 scores. only put 100-200 through it per month.

Mainly use Amex BCP. 


It wouldn't surprise me over time if we start to see more of this happening, not just with CO, but many if not all lenders.  If someone is only using a very small portion of their limit, there's really no incentive or benefit for a creditor to leave a significantly larger limit available to that person.  I see much outrage on the forum if this ever happens.  Discover has been losing their arse lately along with Cap1, just makes sense.


Discover cough cough..  This is the next prime one I see it happening to people with big limits that barely use them along with more of a sub-prime base and a smaller bank using other funding sources than just themselves.  Also have had higher than anticpated CO ratios in the last several quarters most likely due to market they cater to.  So it wouldn't surpise me at all if Discover followed Cap1 lead.  Time will tell if other lenders will follow.  This is why if you want a big CL stay and want it to remain faily "safe" then a CU is the way to go


That's funny to me because Discover is the one lender that has never given me much luv.  They started me at an $800 limit and CLIs have always been around $300 at a time.  My current limit with them is $2600 - it's going to make me giggle if they try to slash that.  I do agree that a lot of people got huge limits with them that seem a bit out of line.

 

I think NFCU might be a candidate and it seems that they may have at least slowed down in the limits they're giving out (haven't seen any reports of CLD though).


Agree with all you said now whether a CU does it since you belong and are a part owner of said CU and the members fund their CC's this is a bit more trickly.  NFCU has certainly slowed down with the approval amounts and the CLI amounts, whether they see big enough loses in the future to the market they cater to as well which is all spectrums only time will tell.

 

Discover does like rebuilder or new to credit people vs. well established credit profiles and that is a fact that not many can argue or would be hard pressed to put a valid argument.  People with 650's and just say a 50k incomes getting SL with 5-10k and CLI's and others with 700+ scores and incomes much higher get 1k SL and no CLI's.  Really not hard to see with all the data points on this forum and the Charge-off rates that are made public by Cap1 and Discover kinda shows why at least Cap1 is pulling back on approvals for big limits and Discover train on CLI's has mainly derailed.  I understand completely why Cap1 CLD me from 35k to 10k as I didn't use their card and it made business sense.  I don't really understand why Discover I only have a 3.25k CL with though sa I can pay that off many times in one month with what I make and it is essentially a useless card for me due to the CL even if I had a desire to use it more due to the CL.  Would love to use the double Cash Back of 3% for the first year for 2k-3k charges, but finally got the limit up to where if I wanted I could probably squeak a big charge on then would be forced to PIF to be able to use it agian in a few days. I would be more than happy with a 10k CL from discover, but don't see that happening anytime in the next year.  They like certain type of borrowers and neither yourself or me fits into that mold

Chase | Citibank | Amex | BofA | PenFed | NFCU | Discover | Barclay's | US Bank | Fifth Third Bank | FNBO
Message 21 of 43
Senior Contributor

Re: $20k CLD from Capital One


c00mtg wrote:

I can see this happening to me in the near future.  I carried a balance of about $35k on my $45k CL Venture for two months then paid to $0 back in August while in Spain.  I then charged $16k in October and paid to $0.  I then got a CLI to $46.5k and the card now has $0 balance. 

 

I'm using other cards now, so i'm just waiting for them to CLD me to around $10k one day lol.  It doesn't matter to me because i don't carry a balance.    You can have $500 in total credit lines and still be at $0 debt or less than 1% UTL.  

 

If was fun seeing all those members getting approved for high CLs when the merging card feauture came out...


I guess a good data point to know from those that have received CLDs would be how long they have gone without a significant spend prior to receiving the CLD.  I'd venture to guess this doesn't happen very quickly, perhaps a year?  So, if you had strong usage of your limit back in August, perhaps even with minimal to no usage you wouldn't get hit with a CLD until next August or so.  That's what my take on it would be, but I'd like to hear data points from those that have received CLDs.  In many cases, I think these CLDs come to people that actually never have used a significant portion of their limit the way you did.  If your "high balance" on your account is a few hundred bucks, it's no surprise that a $20k+ limit would be taken down eventually... but if your "high balance" is a 5-figure amount, I think that would buy you a good amount of time before experiencing a similar CLD.

 

Message 22 of 43
Senior Contributor

Re: $20k CLD from Capital One


CreditCuriousity wrote:

Discover cough cough..  This is the next prime one I see it happening to people with big limits that barely use them along with more of a sub-prime base and a smaller bank using other funding sources than just themselves.  Also have had higher than anticpated CO ratios in the last several quarters most likely due to market they cater to.  So it wouldn't surpise me at all if Discover followed Cap1 lead.  Time will tell if other lenders will follow.  This is why if you want a big CL stay and want it to remain faily "safe" then a CU is the way to go

While this could certainly happen at some point, I'll tell you why I disagree with you.  Discover is still handing out CLIs to high-limit accounts to people that barely use them.  I'm a perfect example.  I put a 2-digit spend on my Discover card most months, on occasion hit a $100-$300 spend.  They just gave me a SP CLI last month of $5500 taking my card across the $30k mark.  That's a completely useless/unnecessary CLI relative to my spend and account history.  Until I see Discover stop handing out CLIs like this to people that barely use their accounts that already have high limits, I see no reason that they'd head in the other direction by instituting CLDs.  Once they stop handing out obnoxious CLIs for no good reason it will be a sign that they're changing their business model.  At that point what you propose may follow soon enough.  I simply don't think we are near that point yet.

Message 23 of 43
Senior Contributor

Re: $20k CLD from Capital One


CreditCuriousity wrote:

Discover does like rebuilder or new to credit people vs. well established credit profiles and that is a fact that not many can argue or would be hard pressed to put a valid argument.  People with 650's and just say a 50k incomes getting SL with 5-10k and CLI's and others with 700+ scores and incomes much higher get 1k SL and no CLI's. 


While that may be true many times, I think there are plenty of people with established credit profiles that do just fine by Discover.  When I applied for Discover my credit score was in the 730's, I had an AAoA of 7 years and a AoOA of 15 years along with a thick file.  Income was upper 5-figures.  They handed me a $12,500 SL.  My father apped shorly after me, he had an AoOA of 40-something years, scores 800+ and was approved with a 5-figure SL.  I have multiple friends that have thick/aged profiles with solid scores that have apped for Discover in the last year and have been given 5-figure SLs.  I agree with you that from reading on this forum this may not seem all that common, but from where I stand looking at data points outside of this forum I can tell you that I'm not an outlier. 

Message 24 of 43
Valued Contributor

Re: $20k CLD from Capital One

Well, we could only guess, and even if we have a long list of data points, we will never be able to tell why the bank CLDs a specific someone.  Just like we all need to meet certain criteria to get approved for a card and a CLI, the same applies when the banks decide to CLD someone. 

 

Your Discover it's a $30k CL which is useless to you, but the bank saw something (a good pattern) that triggered the increase even though you're not using much or most of the CL.  Same for CLDs, I do firmly believe that when this happends, it is not because you're not using the card/limit, rather because from a SP, they saw something that triggered their internal algorithms to say: "if this and this is happening, for this card or these cards for this amount of time etc - do this to the account".  

 

 

Message 25 of 43
Senior Contributor

Re: $20k CLD from Capital One

While what you say may be true to some degree, I think when it comes to CLDs outside of negative items being introduced into the equation, lack of spend is probably the number one reason why they happen.  Almost everyone that states they receive a CLD on their card that hasn't have negative items introduced to their profile state that they haven't been using the card much or at all, or have had a very small monthly spend relative to the credit limit.

 

Slightly off topic, but it seems like the majority of CO accounts that are seeing CLDs due to lack of use are seeing their $20k+ credit lines lowered to $10k.  For some reason $10k seems to be the most common number that CO CLDs people to? 

Message 26 of 43
Valued Contributor

Re: $20k CLD from Capital One

I've lost track of which posts are in which thread, but there was a limit reduced from 16K.

 

I think the most important information we can get from those who've had this happen is their level of spending and how long they were at that level.

Message 27 of 43
Senior Contributor

Re: $20k CLD from Capital One

Was the $16k limit reduced to $10k?

 

I agree that card usage is the #1 factor when it comes to CLDs.

Message 28 of 43
Super Contributor

Re: $20k CLD from Capital One


BrutalBodyShots wrote:

While what you say may be true to some degree, I think when it comes to CLDs outside of negative items being introduced into the equation, lack of spend is probably the number one reason why they happen.  Almost everyone that states they receive a CLD on their card that hasn't have negative items introduced to their profile state that they haven't been using the card much or at all, or have had a very small monthly spend relative to the credit limit.

 

Slightly off topic, but it seems like the majority of CO accounts that are seeing CLDs due to lack of use are seeing their $20k+ credit lines lowered to $10k.  For some reason $10k seems to be the most common number that CO CLDs people to? 


I have also seen an increase in those checks and BT offfers from cards I don't use much which could be the CCCs last attempt to get one to use them before they do a CLD.

12/08/2017 FICO: EQ 843 TU 849 EX 844
Message 29 of 43
Valued Contributor

Re: $20k CLD from Capital One

BrutalBodyShots wrote:

Was the $16k limit reduced to $10k?

 

I agree that card usage is the #1 factor when it comes to CLDs.

It's on page one of this thread. Yes, it was reduced to 10k. I believe just about every CLD has resulted in $10k, maybe all of them.

Message 30 of 43