Citi Slashed my Credit Limit by half

[Anonymous]

I received my statement online the other day along with a document.  I read the document and it stated my credit line had been decreased by half.  Citi left me a total of $42.00 for purchases and cash advances!!! 

I had joined their Partner Program whereby I would pay an extra $150.00 above my minimum for three months and receive a credit on my account for doing this.  I received a $34.00 credit and a credit line decrease!! 

I have no need of a relationship with that card now.  I really thought Citi was trying to help people with the bail-out monies but I see they are no different than BOA, Amex and Chase.

I am paying off my credit cards and will keep a company that has never ever called me, denied me credit and have raised my credlit limits in time of hardship; for instance death of my mom and sister and that is Capital One.

[Anonymous]

I forgot to state the reason they said my credit line was decreased and that was because I had high balances on my other cards.  Well I have had high balances on my other cards when they gave me a CL of $11,500!  I have been feverishly paying the others off and haven't added any more credit cards in over a year now. 

I'm on the Dave Ramsey Program now so this doesn't worry me as much as it once did.  Still, you join a program at their request and you honor it and then they slash your limit and leave you nothing to use on your card at all.

[itsjustmeibe]

Do you know if that was part of the agreement with the program? Reason I ask is because I just did a similar program with AMEX, a paydown on a business card. I had a limit of $28,600 on which I owed like $25k. I paid $12k on it and they credited me with $800, ~ 4 months of interest charges, but the caveat was that my limit would be reduced to $13k. They also guaranteed my limit for a year.

Maybe yours worked similarly?

[creditwherecreditisdue]

If this happened to me I would call Citi and ask them why and to restore my CL. You have to do what you are personally comfortable with. My personal belief/practice is that all AA must be questioned.

[FretlessMayhem]

This was a program that was discussed around here a while back. Didn't the Terms and Conditions state that by receiving the credit for paying down your balance that they would decrease the credit line for new purchases?

[Anonymous]

Hi everyone who answered!

I received a letter in the mail about four  months ago and even received a notice online that Citi was offering this program.  I looked through my papers and I don't see anywhere them saying they will slash my purchase limit!!  That's all I use at the Citi Bonus Mall!!!  Last month I charged $200 and paid them $418.00.  Now this. 

My card was due to expire today but Citi sent me replacement cards three weeks ago.  I called in and was told by the CSR that I had a great limit, good repayment history and was paying well above the $150.00. 

As to wanting them back, NO THANK YOU.  This is the second company who have reniged on their agreements and evidently they can change their minds on this just like anything else they have said in the past.  I'm done!   Oh and the document said online that it was from Early Warning from Citibank Dept.  LOL....no warning....JUST YOU HAVE BEEN SLASHED!!! 

Message Edited by Tonia on 09-30-2009 01:07 PM

[creditwherecreditisdue]

Attempting to get your CL restored is protecting your FICO scores. Short of doing so anticipate a considerable reduction due to increased UTIL %. You may not want to do it but it could be very much in your best interest to do so.

[Anonymous]

Citi has the weakest balance sheet of the major banks and is in the middle of reducing their overall credit limits by 50%-55% in order to strengthen that balance sheet. The bailouts only provided temporary support. The stress tests highlighted what was already known, that their capitalization vs. exposure ratio was inadequate.

So far, they have mostly taken a different approach than other banks (like BOA for example) who just chop large chunks from credit limits. Citi has been doing a lot of ratejacking and when many of those victims decide to opt-out with immediate or eventual account closure, that means Citi gets a 100% CLD from those accounts. That is not going to achieve the 50%-55% reduction, however, so I'd expect Citi will need to do a large number of additional CLDs to reach their goal.

The most likely methods (same as everybody else) are chasing the balances on selected "risky" accounts, and chopping large credit limits that do not appear to be used often. Lots of customers with perfectly good credit and high scores will see CLDs in the next 9-12 months, until Citi reaches its goal. It's not a case of Citi judging individual accounts unfairly, it's a case of Citi needing to reach a target "number" within a limited time ...

[Anonymous]

creditwherecreditisdue,

I see what you are saying about the reduction in UTIL%,  but if the credit card company is not going to reinstate my credit limit then what can I do about my FICO score?  Easier said than done.  Bank of America said it was due to economic times and so did Amex and Chase.  If the companies are reducing the credit lines and chasing the balance then FICO should take that into consideration that it is not the customer that is not paying and reducing their balances, but it's the adverse actions of the credit card companies preventing the customer from rising higher.

My answer to this adverse action is to pay off my credit cards and carry no balances whatsoever and close the cards. 

[Anonymous]

Well I'm sorry to hear Citi has the weakest balance sheet of all the companies because they used to be one of my favorite companies to do business with.  We have our mortgage with them, but after they slashed the credit card after paying as agreed and more than the minimum payment x2 then how can we trust them with any of our business?  Our home value did go up and we have a lot of equity in our home. We do qualify for refiancing at atleast two banks that we inquired of. 

My FICO scores  have always been important to me in the past, but now I am pretty much put out with the slashing and the chasing the balances and my scores suffering as a result....so much to the point of me not worrying about scores anymore and to just save and pay cash for as much as I can or do without.  

Message Edited by Tonia on 09-30-2009 10:34 PM