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Amex reduced credit limits. Are we back in 2008?

Rebuild2022
Super Contributor

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

OP, I am sorry to hear about CLD. Just be cautious in these changing times and down turn in economy.

Gardening since 08/2020
Message 11 of 61
CreditCrusader
Established Contributor

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


@Revelate wrote:

@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.


Not yet, but give it time. Landlords/mortgage holders can only wait so long for payment...and millions of lost jobs aren't coming back because many businesses are closing their doors for good, not temporarily.

 

Sooner or later, people who are currently kept afloat by UE and stimulus checks will have to bring current months of past due mortgage payments. Is the government going to order banks to not foreclose on those homes? Methinks that's not happening.

 

I get what you're saying, but I heard this sort of optimism in 2000 and 2008:

 

"This won't affect me! I don't hold dot com stocks (2000) or have a mortgage at WAMU (2008), so I'm good."

 

Except that ALL bad recessions hit EVERYONE in some fashion or another. There will be no bank bailouts this time, so AA on a wide scale is not only possible, but likely, IMO.

I'm Spartacus!

hr>Starting Score: EQ 546, EX 547, TU 580
Current Scores (lender): EQ 747 , EX FICO 760, TU 758 FICO scores>
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Message 12 of 61
longtimelurker
Mega Contributor

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


@Remedios wrote:

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

 

 

 

 


Oh, another one convinced by mainstream media that the dinosaurs are extinct.   LOL.   What do you think are in those heavily guarded  big warehouses near the intersection of I85 and I26?   

Message 13 of 61
Remedios
Moderator

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


@longtimelurker wrote:

@Remedios wrote:

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

 

 

 

 


Oh, another one convinced by mainstream media that the dinosaurs are extinct.   LOL.   What do you think are in those heavily guarded  big warehouses near the intersection of I85 and I26?   


Samples of flat Earth. Everyone knows that, @longtimelurker 

 

 

Undead Danny Trejo looks strangely like dead Danny Trejo, who looks exactly like alive Danny Trejo. Thanks, Netflix!
Message 14 of 61
8ways2learn
Valued Member

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

Nope mine just got raised from 2k to 10k 

 

Message 15 of 61
Rebuild2022
Super Contributor

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


@8ways2learn wrote:

Nope mine just got raised from 2k to 10k 


Congrats with your CLI

Gardening since 08/2020
Message 16 of 61
HeavenOhio
Community Leader
Senior Contributor

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

There are two general reasons why AMEX decreases limits.

 

One is to not use a card much or at all. In those cases, calling in will likely get one's limit restored.

 

The other is to pay down a balance too slowly. In those cases, AMEX may restore your limit if you pay an amount they designate by a certain date.

Message 17 of 61
Superduper2014
Frequent Contributor

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

@HeavenOhio 

 

Thanks for pointing this out. 

 

On the BC card I didn't use it. It was my first amex and used it and paid off later on completely. 

I opened the ED card and used it for a small bal trans with no fee and the rest for daily purchases. My daily card for groceries, etc. 

I was paying this cards minimum payments since I have zero apr until October, but had the funds to pay off completely by then. I was just trying to decide whether I was going to use my own cash or use a bal transfer from another card when this CL decrease happened. 

 

I wonder if they actually Soft pulled my credit and saw I had applied to 3 credit cards and that played a role in their decision.

 

Should I just call them and ask what happened and start there or should I try to figure out if they sof pulled me (how do I do this), before I called and be prepared to answer about these cards I applied for? I applied for this cards last week, so there are NO new tradelines or credit cards in my report to spook them with real new credit lines, for all they know I could be denied for these other hard inquiries.

 

Also, should I offer the reinstatement for a higher large payment by a certain date or is this something they do? I am interested in continuing to use my ED card until Sept to maximize the 0 percent and also to get back my limits to keep my debt to available credit ratio as it was. This will hurt my scores. 

Please advise on how to approach this so I can call (is today Sunday a good day to call Amex or credit cards in general)

 

Thanks a lot!

Message 18 of 61
elixerin
Established Contributor

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


@Superduper2014 wrote:

@HeavenOhio 

 

Thanks for pointing this out. 

 

On the BC card I didn't use it. It was my first amex and used it and paid off later on completely. 

I opened the ED card and used it for a small bal trans with no fee and the rest for daily purchases. My daily card for groceries, etc. 

I was paying this cards minimum payments since I have zero apr until October, but had the funds to pay off completely by then. I was just trying to decide whether I was going to use my own cash or use a bal transfer from another card when this CL decrease happened. 

 

I wonder if they actually Soft pulled my credit and saw I had applied to 3 credit cards and that played a role in their decision.

 

Should I just call them and ask what happened and start there or should I try to figure out if they sof pulled me (how do I do this), before I called and be prepared to answer about these cards I applied for? I applied for this cards last week, so there are NO new tradelines or credit cards in my report to spook them with real new credit lines, for all they know I could be denied for these other hard inquiries.

 

Also, should I offer the reinstatement for a higher large payment by a certain date or is this something they do? I am interested in continuing to use my ED card until Sept to maximize the 0 percent and also to get back my limits to keep my debt to available credit ratio as it was. This will hurt my scores. 

Please advise on how to approach this so I can call (is today Sunday a good day to call Amex or credit cards in general)

 

Thanks a lot!


send a significant payment, get restored, get off the radar, tread cautiously(reasonably take advantage of 0 apr)

Message 19 of 61
simplynoir
Community Leader
Super Contributor

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

First things first on another topic you mentioned wanting to get a new car. Unless it's a necessity I'd scrap that idea for the moment because between the BT and the continued use on the same card which is a big no-no you're pretty much flirting with other banks following suit. At this point you're just playing the BT game and it normally never ends well

'He took my Doritos away though' - @imapharmacygirl, Wine Connoisseur
Message 20 of 61
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