topic Re: Has anyone ever seen a CC company lower CL as you pay it down? in Credit Cards

Has anyone ever seen a CC company lower CL as you pay it down?

Bogey1975 — Tue, 24 Nov 2020 00:27:36 GMT

I'm trying to get my Citibank Costco Visa under 28%. Every time I make a payment they lower the limit. The 1st time it was a mistake and they raised it back. I just made a payment again and they lowered it again. It would of been down to 27% but it sits at 32%

Re: Has anyone ever seen a CC company lower CL as you pay it down?

blindambition — Tue, 24 Nov 2020 00:36:52 GMT

Sounds like balance chasing. Have you been carrying high balances? That card and others, for long periods.

Re: Has anyone ever seen a CC company lower CL as you pay it down?

Bogey1975 — Tue, 24 Nov 2020 00:50:53 GMT

This card normally hovers around 44%, other cards are in the 30s with the exception of two which are in the 80s, working on bringing those down.

Re: Has anyone ever seen a CC company lower CL as you pay it down?

rostrow416 — Tue, 24 Nov 2020 00:51:06 GMT

It sounds like balance chasing, but your balance isn't at the limit. Something about your profile has them on edge but I don't understand why they wouldn't just lower your limit to whatever point they have in mind>

Re: Has anyone ever seen a CC company lower CL as you pay it down?

blindambition — Tue, 24 Nov 2020 00:57:07 GMT

Three carrying moderately high balances, and two definite high balances, balance chasing sounds like the culprit.

Re: Has anyone ever seen a CC company lower CL as you pay it down?

AverageJoesCredit — Tue, 24 Nov 2020 01:23:42 GMT

@rostrow416 wrote:
It sounds like balance chasing, but your balance isn't at the limit. Something about your profile has them on edge but I don't understand why they wouldn't just lower your limit to whatever point they have in mind>

They are making sure Op cant keep spending on their card

Re: Has anyone ever seen a CC company lower CL as you pay it down?

Bogey1975 — Tue, 24 Nov 2020 01:41:30 GMT

So I guess I just need to bring this card to 0.

Re: Has anyone ever seen a CC company lower CL as you pay it down?

Remedios — Tue, 24 Nov 2020 02:01:32 GMT

Hi and welcome to the forums

@Bogey1975 bringing that card to $0.00 may result in card remaining open or they still might decide to close it.

There really is no way to tell.

I'd be more concerned about those cards that are at 80% utilization.

Citi is no stranger to CLDs (no lender is), but they typically aren't hyper reactive unless it goes on for a while.

Those maxed out cards may cost you additional cards or CLDs, so I'd suggest you focus on brining those balances down to a more bearable level.

Re: Has anyone ever seen a CC company lower CL as you pay it down?

Anonymous — Tue, 24 Nov 2020 02:27:05 GMT

Can we really call it balance chasing though if the result of the CLD is the OP ending with 27%-32% utilization?

OP, can you describe what your limit was originally, where it stands now and how many steps down (CLDs) you received?

Did you have any negative information introduced to your CR from other accounts?

Re: Has anyone ever seen a CC company lower CL as you pay it down?

FinStar — Tue, 24 Nov 2020 02:59:12 GMT

@Anonymous wrote:
Can we really call it balance chasing though if the result of the CLD is the OP ending with 27%-32% utilization?

OP, can you describe what your limit was originally, where it stands now and how many steps down (CLDs) you received?

Did you have any negative information introduced to your CR from other accounts?

Essentially yes, especially if the CL (or overall exposure of the account) is reduced to a certain level, time after time, whenever the overall balance is reduced. Some lenders like BoA, Barclays, SYNCB, Comenity, etc., tend to reduce it to a certain percentage of the CL (closer to the balance amount) to allow for fees (if applicable) and finance charges to accrue during any given statement cycle.

Conversely, Chase, FNBO, Citi, etc., reduce the CL in a variety of cases, but not that close to the existing balance. This isn't a voluntary or random CLD due to inactivity. It's a repeated [CLD] pattern over the course of active account monitoring to reduce a lender's exposure. We can call it "bunny hopping down the ladder" 🤷‍♂️

The OP can certainly provide the respective CLs and balances for the affected accounts (for clarity and reference), but it still wouldn't change the methodology.

Re: Has anyone ever seen a CC company lower CL as you pay it down?

MisterWives — Tue, 24 Nov 2020 03:39:03 GMT

@Bogey1975 wrote:
This card normally hovers around 44%, other cards are in the 30s with the exception of two which are in the 80s, working on bringing those down.

Yeah I wouldn't expect pleasantries from lenders those are high utilizations for at least two. Are these your only cards and do all of them carry balances as if so it is most likely they are looking at your overall profile and might consider it too risky for them if there is balances on all above 30% utilization

Re: Has anyone ever seen a CC company lower CL as you pay it down?

Bogey1975 — Tue, 24 Nov 2020 03:41:22 GMT

My last negative report on my CR is from 2014 which is two 90 day late on my Student Loan (Comes off in June of 2021). The card in question CL was at 15000 with a 6600 balance, I paid it down to 4200. Then CL came down to 12,000 I paid it to 3400, CL is currently at 9210.

Re: Has anyone ever seen a CC company lower CL as you pay it down?

Bogey1975 — Tue, 24 Nov 2020 03:44:48 GMT

I have 7 cards with 0 balances, 4 I just recently paid to 0, and they were at 35-45%. The other two I'm an AU on with the 81% and 89%. I just had myself taken off those cards.

Re: Has anyone ever seen a CC company lower CL as you pay it down?

MisterWives — Tue, 24 Nov 2020 04:03:29 GMT

@Bogey1975 wrote:
I have 7 cards with 0 balances, 4 I just recently paid to 0, and they were at 35-45%. The other two I'm an AU on with the 81% and 89%. I just had myself taken off those cards.

Oh that is good then having other cards at 0. Also not bad the highest utilization cards are AU since you can just remove yourself from them and the negative effects they have that should definitely help.

Re: Has anyone ever seen a CC company lower CL as you pay it down?

FinStar — Tue, 24 Nov 2020 04:03:41 GMT

@Bogey1975 wrote:
My last negative report on my CR is from 2014 which is two 90 day late on my Student Loan (Comes off in June of 2021). The card in question CL was at 15000 with a 6600 balance, I paid it down to 4200. Then CL came down to 12,000 I paid it to 3400, CL is currently at 9210.

So, over a period of how many months did the limit reductions from $15,000 to $9,210 occur? Was it within ~6 months or...? Was the origin of the balance transactional or balance transfer(s)? Were you incurring any finance charges over this period? Is the current balance $0 on this card now?

On the upside, if this is a Citi card, the collateral damage doesn't appear to be as bad. Once you let the dust settle and things normalize, it's possible that you can regain some of the CL back over time. You can periodically check to see if your account eventually qualifies for a SP CLI and see if that works.

Re: Has anyone ever seen a CC company lower CL as you pay it down?

Anonymous — Tue, 24 Nov 2020 14:35:01 GMT

I don't believe the account in question in and of itself resulted in the AA. People roll with a 40%-50% balance on a single account all the time and don't see issues. My guess is that other CR data is what played into the decision. The 2 AU accounts with 80%-90% utilization no doubt wasn't a good look (good thing OP dropped those) and the presence of a major delinquency, even if aged does weaken a profile allowing what would otherwise be so-so utilization to be magnified.

Re: Has anyone ever seen a CC company lower CL as you pay it down?

TGG_1976 — Tue, 24 Nov 2020 14:53:25 GMT

Citi did this to me on two cards last year. Every time I made a payment, the CL went down on both cards. I think I got 3 CLD on each card. I found it so annoying that at some point, paid them down to zero and put them in the drawer.

Re: Has anyone ever seen a CC company lower CL as you pay it down?

CreditMagic7 — Tue, 24 Nov 2020 16:24:37 GMT

Unfortunately, and especially with covid 19 outbreak taking severe toll on the entire retail and financial markets, we will be seeing more of this. Banks especially high end mainstream are under no constraints to communicate their respective balance periods their willing to allow before crossing some breaking point of balance carrying (i dunno where BT comes in on this). And most in my experience won't notify you of where that breakpoint is. I would call my lenders and try to see if they will divulge and even hint at what that is. Its a YMMV type situation in this precarious financial climate IMHO.

I think it's becoming obviously more clear that they indeed are tightening restrictions in many areas of their card account policies at present without necessarily affording their card customers the courtesy (if there is such a thing) of what expectations their at liberty to share as to the duration of balance carrying they are willing to accept before drawing the line.