So, I became a member of the Chase credit card family last summer after ignoring their offers for the last 25 years or so because I was happy with the banks and lenders I had credit card accounts with. Over the years, I've steadily built up a solid payment history (never late or missed payments) even though there were times I maxed out a few cards but always brought the balances down below 10% within a few months (moving expenses, tuition, books, etc) after making the charges and more importantly paying them off within 6 months or so. I rarely hold a balance on my credit cards but there are times I do if I travel for work and use my cards for airline, hotel, rental car and food...then my company reimburses me.
Here's the card offers from Chase that I applied for and their original credit line: Chase Amazon Visa ($3k), Chase United Mileage Explorer Plus Visa Signature ($7k) and Chase Southwest Rapid Rewards Visa Signature Card ($6k).
However, I opened up my Chase online account and noticed something that kind of surprised me. My Southwest card went from a credit line of $6k to $3.5k and the Chase United card from $7k to $1,600. The Amazon card stayed the same at $3k. My reason for visiting the Chase site was to pay off the United and Southwest cards so all three would then have a zero balance. I called a CSR to ask for an explanation regarding the credit line being lowered for these accounts and she told me that as a customer, they do a regular review every 3 months (quarterly) of every account across the board of every Chase credit card member and my utilization was getting close to 30% and that their "risk model" triggered them to lower my credit limits on 2 of the 3 cards. I explained to the CSR that it's only a temporary hike in my utilization because of charging my moving expenses over the last few months but I will be reimbursed and will pay off the cards at that time. With my explanation, she didn't budge...the only thing she offered is that once I get the utilization down below 20%, they will do another review of my credit report and accounts and decide then whether or not to raise my credit line to it's original amount...either that, or I could call and request an increase if I'm under the 20% utilization. No guarantees.
Moral of the story is this....because I was close to the magical 30% utilization number, Chase lowered my credit line that in turn basically lowered my credit score even further because my outstanding credit card debt divided by my available credit line (now decreased) raised my utilization percentage again ....cc debt/avaliable credit line=utilization percentage. In other words, Chase lowered my available credit line by an additional $8,400 and bumped my utilization up an additional 10% so now I'm sitting closer to 40% instead of just slightly under 30%. What I've vowed to do is pay off every single credit card I have in the next 2 months and it's doable. I believe it's also time to part company with Chase due to the rigid policy they have with utilization. Citi, Wells Fargo, American Express, Barclays and Capital One have never lowered my credit line on any card and I've managed to get my utilization upwards of 50% at times because of moving expenses or job related expenses but I've always been quick to pay the debt off within 30 to 45 days.
