I have a credit card with a credit limit of $12,500. I have not only been making the payments each month, but I have been paying off my monthly balance at the end of each month consistently. My father told me that, given the situation of today's financial market, the bank can decide to lower my limit. Is this possible? Is this likely? If so, what factors would influence their decision to lower my credit limit?|||Yes, they can and have been. Having a high actual debt to total available credit ratio is one red flag. Making only minimum payments is another. |||Look for it to get lowered at any time, esp, if it's a Citibank card-they are in deep trouble, so they are looking at all customers and want to lower their risk as much as possible. CC company's look at your overall debt, payment history with them and other cc you may have, how long have you been a customer etc. So don't be surprised if it gets lowered, they can also raise interest rates too, and fees so keep an eye out for the little mailers that come in small white envelopes-easy to throw away as junk mail|||Mine was also lowered, the reason was that I don't do that much charging. the greatest charge was for a new computer, which I paid off at the end of the month.
My history of charging as very, very, low, therefore a cut in my credit limit. I don't use the card enough to warrant a high credit limit.|||A credit card company would only lower the credit limit of cardholders when cardholders consistently delay payments and frequently defaul on the account. In your case, it's very unlikely that your card limit will be lowered. However, credit card companies can unilaterally lower cardholders' credit limit if they so choose/decide.|||I read something funny in Money magazine.
If you are a good customer that pays their bills in full each month, they are actually raising your credit lines.
Their hopes are that you will spend more and eventually trap yourself into paying interest.
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