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Amex reduced credit limits. Are we back in 2008?

Superduper2014
Frequent Contributor

Amex reduced credit limits. Are we back in 2008?

Hello guys,

 

My 2 Amex  credit lines were reduced significantly today. 

 

Are you guys seeing a pattern or it may be that Amex noticed that I had just been applying to several cards and they got spooked?

 

I did apply for 3 cards last week and got 3 approved (citi, discover and US bank). 

 

Any way to get these limits back to what they were by calling them or to know if they SP my credit recently to make this decision?

 

I had a Blue Cash with 5k that went to 1k (didn't use this card) and the Everyday card with 26k reduced to 21k and a big balance on this one. 

In fact I was going to pay this Everyday card with a Bal tr from one of the new cards I was approved for. 

This is in a nutshell what is happening to me. 

 

I fear the banks are getting spooked. The Fed's chairman said recently "The scope and speed of this downturn are without modern precedent, significantly worse than any recession since World War II," Powell said in prepared remarks webcast by Washington-based think tank Peterson Institute for International Economics (PIIE).

 

These are the guys that are supposed to bluff us to think everything is alright. Some banks are not even offering HELOCs anymore forseeing home prices collapse. Things are not looking very good my friends. I don't want to sound alarming, but I am seeing what I saw back in 2008 and I remember well. 

 

Thoughts are welcome about what I should do with Amex, if anything can be done at all to get back my credit lines. 

 

Thanks

Message 1 of 61
60 REPLIES 60
Superduper2014
Frequent Contributor

Re: Amex reduced credit limits. Are we back in 2008?

Message 2 of 61
NRB525
Super Contributor

Re: Amex reduced credit limits. Are we back in 2008?

What is the balance you owe on the ED?

High Bal Jan 2009 $116k on $146k limits 80% Util.
Oct 2014 $46k on $127k 36% util EQ 722 TU 727 EX 727
April 2018 $18k on $344k 5% util EQ 806 TU 810 EX 812
Jan 2019 $7.6k on $360k EQ 832 TU 839 EX 831
March 2021 $33k on $312k EQ 796 TU 798 EX 801
Message 3 of 61
Brian_Earl_Spilner
Community Leader
Mega Contributor

Re: Amex reduced credit limits. Are we back in 2008?


@NRB525 wrote:

What is the balance you owe on the ED?


I'm gonna guess about $20k or they would have lowered it more. I'm thinking that balance has been growing for an extended period of time and the new cards triggered the AA.




Message 4 of 61
K-in-Boston
Moderator

Re: Amex reduced credit limits. Are we back in 2008?

I doubt it really has anything at all to do with C19.  If the card was nearly maxed out and you opened 3 new accounts all at once, that could and likely would happen in the best of times.  Didn't you also apply for another Amex card very recently, too?  Another thing to spook them.

Message 5 of 61
Remedios
Moderator

Re: Amex reduced credit limits. Are we back in 2008?

The balance you have on ED, was that also a BT from a different card that you're now trying to BT elsewhere? 

Undead Danny Trejo looks strangely like dead Danny Trejo, who looks exactly like alive Danny Trejo. Thanks, Netflix!
Message 6 of 61
NRB525
Super Contributor

Re: Amex reduced credit limits. Are we back in 2008?

I see there are at least two threads by the OP dealing with very closely related BT questions and AA questions.  

High Bal Jan 2009 $116k on $146k limits 80% Util.
Oct 2014 $46k on $127k 36% util EQ 722 TU 727 EX 727
April 2018 $18k on $344k 5% util EQ 806 TU 810 EX 812
Jan 2019 $7.6k on $360k EQ 832 TU 839 EX 831
March 2021 $33k on $312k EQ 796 TU 798 EX 801
Message 7 of 61
CreditCrusader
Established Contributor

Re: Amex reduced credit limits. Are we back in 2008?


@Superduper2014 wrote:

Interesting article. Very revealing. 

 

https://www.bankrate.com/finance/credit-cards/issuers-lower-credit-limits-coronavirus-response/ 


But wait...I read here in FicoForums that this wasn't happening...that it was happening to just a small segment of the card-holding community.

 

I remember the recessions of 2000 and 2008 very clearly. In 2000, I walked into my long-time bank with pristine credit and was told that a $2,000 personal loan had to be fully secured...with cash. I asked how that was any different than using my own money and the loan officer said it wasn't, but that their terms required security during those economic times.

 

I've been saying it here for weeks now: This in-the-process recession is REAL...and it won't turn around in a snap, so folks should prepare for some hard credit times to follow, regardless of your file/FICO score unless you have millions in the bank and are prepared to prove it.

 

Edited to add: Just because YOUR lines have not yet been cut doesn't mean they won't be. CCCs don't owe anyone large lines or multiple cards...and you really have no recourse if they get ultra conservative with their lines and products during a recession. Planning for the worst means you can weather any credit storm, even during a recession.

I'm Spartacus!

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Message 8 of 61
Remedios
Moderator

Re: Amex reduced credit limits. Are we back in 2008?


@CreditCrusader wrote:

@Superduper2014 wrote:

Interesting article. Very revealing. 

 

https://www.bankrate.com/finance/credit-cards/issuers-lower-credit-limits-coronavirus-response/ 


But wait...I read here in FicoForums that this wasn't happening...that it was happening to just a small segment of the card-holding community.

 

I remember the recessions of 2000 and 2008 very clearly. In 2000, I walked into my long-time bank with pristine credit and was told that a $2,000 personal loan had to be fully secured...with cash. I asked how that was any different than using my own money and the loan officer said it wasn't, but that their terms required security during those economic times.

 

I've been saying it here for weeks now: This in-the-process recession is REAL...and it won't turn around in a snap, so folks should prepare for some hard credit times to follow, regardless of your file/FICO score unless you have millions in the bank and are prepared to prove it.

 

Edited to add: Just because YOUR lines have not yet been cut doesn't mean they won't be. CCCs don't owe anyone large lines or multiple cards...and you really have no recourse if they get ultra conservative with their lines and products during a recession. Planning for the worst means you can weather any credit storm, even during a recession.


Nope.

While current situation has a potential to disrupt and change lending, blaming current issues for problems that started years ago is beyond ridiculous. 

People seem ready to blame COVID-19  for dinosaurs extinction. 

 

COVID-19 only sped up the inevitable. 

 

While this may sound harsh, I dont know any longer how/if to respond to "I only got 5 lates in the last year. Is my card closed because of COVID-19?" 

 

OP shared their story, and that's great, but these issues were present way before the virus. 

It really doesnt help anyone to be less than honest. 

 

Undead Danny Trejo looks strangely like dead Danny Trejo, who looks exactly like alive Danny Trejo. Thanks, Netflix!
Message 9 of 61
Revelate
Moderator Emeritus

Re: Amex reduced credit limits. Are we back in 2008?


@CreditCrusader wrote:

@Superduper2014 wrote:

Interesting article. Very revealing. 

 

https://www.bankrate.com/finance/credit-cards/issuers-lower-credit-limits-coronavirus-response/ 


But wait...I read here in FicoForums that this wasn't happening...that it was happening to just a small segment of the card-holding community.

 

I remember the recessions of 2000 and 2008 very clearly. In 2000, I walked into my long-time bank with pristine credit and was told that a $2,000 personal loan had to be fully secured...with cash. I asked how that was any different than using my own money and the loan officer said it wasn't, but that their terms required security during those economic times.

 

I've been saying it here for weeks now: This in-the-process recession is REAL...and it won't turn around in a snap, so folks should prepare for some hard credit times to follow, regardless of your file/FICO score unless you have millions in the bank and are prepared to prove it.

 

Edited to add: Just because YOUR lines have not yet been cut doesn't mean they won't be. CCCs don't owe anyone large lines or multiple cards...and you really have no recourse if they get ultra conservative with their lines and products during a recession. Planning for the worst means you can weather any credit storm, even during a recession.


And I'll reply the same thing as I did the last time someone posted that click bait article Smiley Wink.

 

myFICO members, especially in this subforum push boundaries.  If it were really as widespread as suggested we would hear screaming here with the mods rushing to consolidate all the posts into a single thread for some hope of sanity.  See NFCU and Duck Card and all the other rabbit holes right or wrong we've gone down on this forum.

 

That has not happened yet, it most certainly hadn't happened two weeks ago when bankrate posted that article.

 

Everyone, including banks, is holding their breath.  Really we are just seeing the opening moves for example by airlines with retiring some of their fleet earlier than planned.  Also a whole bunch of those unemployed may well be the underbanked too.

 

Don't get me wrong, arguments about statistics aside this whole C19 thing sucks blue whale... but we aren't back in the throes of the mortgage crises where people were defaulting on billions of dollars worth of mortgages.

 

The scale of consumer debt on credit cards is dwarfed by that problem, and credit cards have been cash cows for the lenders.  If nothing else, limit chasing in the OP's case, we saw that in the sunshine and happy credit days too (2013 through 2019) and we didn't have COVID to worry about then.

 

When good credit / financial profiles start getting whacked for various things including non-use, that will be a change, or if we get a tidal wave of closures.  This, not so much.

 

ETA: I probably am on some people's canary list for Amex - no real use for most of a decade and sitting with ~45K in limits with a Zync annual fee and something like $30/month averaged over that time period other than sub chasing.  Not a good Amex customer TBH.




        
Message 10 of 61
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