Credit Limit Decrease - You Too?

[kimg727]

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@marty56 wrote:

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@kimg727 wrote:

The reduction in CL will, however, hurt my overall utilization because I have about 10K in outstanding revolving credit (I have 0% interest on home furnishings).

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IMHO the cause for your CLD.  10k is a lot of CC debt regardless of income or available credit these days.

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At first, I thought the same thing because, as we all know, the credit report doesn't show promotional offers of 0% interest, etc. I could pay the 10K off in two months but won't because of the no interest.  I'd rather take that money and put it in an interest bearing account.

When I got the letter stating those bogus reasons, I called the rep back (he gave me his direct line) and he said it had nothing to do with it.  He said it was a form letter and they are just cancelling cards to reduce debt.  The only cards they are keeping open are the ones with stellar credit.  Even those are having the CLs reduced, as I experienced.

Either way, I'll bounce back from it.  But it just irritates me because in my case and opinion, I've been so loyal to that credit union and it's not warranted.  

[notmyname]

The wording of the first post by OP and the one below are confusing me a little. You made a ten thousand payment and because you have used the word " outstanding", it seems you are also saying below that you have a ten thousand balance still on the account.

If this is the case, you might not have been targeted had you not maxed the use of the card. ( I never go over fifty percent and try to keep thirty percent as my limits, and even in my high limit accounts I have not been touched by CLD even though I do a lot of things,even with amex, that people here say one shouldn't do ?)

If I am reading this post incorrectly I apologize: I am just trying to figure out why others and not me ,otherwise ......good luck.

NMN

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@kimg727 wrote:

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@haulingthescoreup wrote:
If you can pay in full BEFORE your statement posts, it won't affect your scores. if you carry a balance, or if you wait until your statement posts with the balance due, your scores will be hit to varying degrees.

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The EFFCU credit card (since I have it tied into my checking and the rate is fixed at 5.9%) is the primary one I use.  On average, I charge about 5K a month on it.  90% of the time I pay if off but there are months if I fall short, I carry a balance.

The reduction in CL will, however, hurt my overall utilization because I have about 10K in outstanding revolving credit (I have 0% interest on home furnishings).

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[notmyname]

I believe the CSR gave you a "form comment" about a "form letter". Their job is to get off the phone within a set frame of time and I imagine they are having a lot of calls like yours.

Also .....go back and reread your Fico info and you will find that accounts over fifty percent are not "stellar".

NMN

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@kimg727 wrote:

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@marty56 wrote:

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@kimg727 wrote:

The reduction in CL will, however, hurt my overall utilization because I have about 10K in outstanding revolving credit (I have 0% interest on home furnishings).

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IMHO the cause for your CLD.  10k is a lot of CC debt regardless of income or available credit these days.

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At first, I thought the same thing because, as we all know, the credit report doesn't show promotional offers of 0% interest, etc. I could pay the 10K off in two months but won't because of the no interest.  I'd rather take that money and put it in an interest bearing account.

When I got the letter stating those bogus reasons, I called the rep back (he gave me his direct line) and he said it had nothing to do with it.  He said it was a form letter and they are just cancelling cards to reduce debt.  The only cards they are keeping open are the ones with stellar credit.  Even those are having the CLs reduced, as I experienced.

Either way, I'll bounce back from it.  But it just irritates me because in my case and opinion, I've been so loyal to that credit union and it's not warranted.  

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[iamrayl]

I think you misread the OP's post.  He is carrying a 10 K balance with a 0% financing offer for furniture on another card.  He mentioned that he recently paid off the card that was CLDed by the CU.

[kimg727]

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@iamrayl wrote:
I think you misread the OP's post.  He is carrying a 10 K balance with a 0% financing offer for furniture on another card.  He mentioned that he recently paid off the card that was CLDed by the CU.

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You are completely correct.

[Anonymous]

don't feel bad. 4 cld's so far this year. amex 4k to 500, boa 15k to 14.1k, citi 1k to 500, and chase 5k to 4k. mine are uti induced score drop caused.

good luck weathering the storm.

[kimg727]

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@Anonymous wrote:

don't feel bad. 4 cld's so far this year. amex 4k to 500, boa 15k to 14.1k, citi 1k to 500, and chase 5k to 4k. mine are uti induced score drop caused.

good luck weathering the storm.

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Oh My. 

I have a feeling it's just going to be the beginning for many...

[Anonymous]

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@kimg727 wrote:

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@Anonymous wrote:

don't feel bad. 4 cld's so far this year. amex 4k to 500, boa 15k to 14.1k, citi 1k to 500, and chase 5k to 4k. mine are uti induced score drop caused.

good luck weathering the storm.

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Oh My. 

I have a feeling it's just going to be the beginning for many...

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well i knew it was coming. my cu cards are still untouched, hoping they stay that way.

[Anonymous]

Consider this. I think I'm seeing a pattern lately where it's not so much "a bank's exposure" but rather seems like a margin/reserve thing. Overhead. Many of the people here who are being CLD the most have unusually high credit limits and good histories. Could it be that banks are needing to be able to show they have a reserve thus shaving the tops off high limit accounts rather than shaving those accounts to limit their exposure? What I'm saying is I don't think people with high credit limits are being credit limit decreased because they are a risk, I think they are being CLD so the banks can show those funds as being available elsewhere. 

I don't think people are being CLD for utilizing a high percentage of there limits if they are paying off that balance every month. I typically run up 70% on both my largest cards but PIF every month and I'm getting CLI's but I don't have really high credit limits either.

I do expect a CLD from GEMB on one card I have because the CL is a ridiculously high amount and I never use the card.

[kimg727]

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@Anonymous wrote:

Consider this. I think I'm seeing a pattern lately where it's not so much "a bank's exposure" but rather seems like a margin/reserve thing. Overhead. Many of the people here who are being CLD the most have unusually high credit limits and good histories. Could it be that banks are needing to be able to show they have a reserve thus shaving the tops off high limit accounts rather than shaving those accounts to limit their exposure? What I'm saying is I don't think people with high credit limits are being credit limit decreased because they are a risk, I think they are being CLD so the banks can show those funds as being available elsewhere. 

 

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That's pretty much what the representative was telling me..to reduce their "potential overhead" and "available credit."  

At this point, who knows.  It's anyone's guess...but the representative I talked to was very knowledgeable, direct, matter of fact and to the point.  He said, if anything, they are cancelling cards.  He was surprised my CL was as high as it was (even with the reduction).