SIMON AMEX BY CARDLESS

[Benzman]

Got notice today that credit line was cut from 6K to $500 due to non use. Put a few small charges every so often to keep it open. Called to see if original line could be reinstated and denied. Rep said they have had to cut lines for the majority of cardholders not using enough available credit and also not allowing CLIs at this time. Told rep I will probably be closing it soon as $500 is a joke.

[ElvisCaprice]

This seems to be happening more and more.  Frankly, I don't blame the issuers for giving haircuts to CL's for non full healthy use of the intended CL.  Makes sense.  And your closing of the account just reconfirms your "non use" future intentions for their card.  Mission accomplished on their end.  

Just reconfirms my beliefs that you should set your CL's at a reasonable healthy limit for your intended use.  Close those that you never intend to make use of.

[longtimelurker]

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@ElvisCaprice wrote:

This seems to be happening more and more.  Frankly, I don't blame the issuers for giving haircuts to CL's for non full healthy use of the intended CL.  Makes sense.  And your closing of the account just reconfirms your "non use" future intentions for their card.  Mission accomplished on their end.  

Just reconfirms my beliefs that you should set your CL's at a reasonable healthy limit for your intended use.  Close those that you never intend to make use of.

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The flip side is that we have seen people have limits reduced (or cards closed) if they do use a "healthy amount", near to the maximum.   The utilization hit reduces score and can set off alarms.   So there probably is a sweet spot, varying with issuers, where spend is enough to justify an existing CL without being seen as a risk.

[ElvisCaprice]

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@longtimelurker wrote:

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@ElvisCaprice wrote:

This seems to be happening more and more.  Frankly, I don't blame the issuers for giving haircuts to CL's for non full healthy use of the intended CL.  Makes sense.  And your closing of the account just reconfirms your "non use" future intentions for their card.  Mission accomplished on their end.  

Just reconfirms my beliefs that you should set your CL's at a reasonable healthy limit for your intended use.  Close those that you never intend to make use of.

---

The flip side is that we have seen people have limits reduced (or cards closed) if they do use a "healthy amount", near to the maximum.   The utilization hit reduces score and can set off alarms.   So there probably is a sweet spot, varying with issuers, where spend is enough to justify an existing CL without being seen as a risk.

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Yup, the difference being that they carry a balance as opposed to paying it off in full each cycle by due date.  And those low introductory offers are not the gift they seem to bare, putting you at risk with other issuers when you carry a balance.  

1.  Set CL to a reasonable healthy level for your intended spend.

2.  Always pay your balance off in full each cycle.

[pauldc73]

It seems that CLD from lenders should not be a complete surprise in these times.  From the lenders perspective, they would be limiting exposure and/or freeing up credit lines in order to take on new business that could well be more profitable.