Over the past four months, I’ve been contacted by a lot of consumers who had their credit card limits decreased. Many of these consumers had their credit limits reduced to as little as $100 more than their current balance, putting them at risk of over the limit fees and penalties. And, while the old adage is adding insult to injury, the real issue here is adding injury to the insult of getting your credit limit decreased.
Overview
When a credit card company cuts your credit limit, this can have a huge, negative impact on your credit score. The reason lower credit limits can rapidly erode your credit score lay in the heavy weighting given to the utilization of available balances. For example, a person with $900 in credit card debt and a credit limit of $10,000 gets a credit score boost because they are using less than 10% of their available revolving credit. Even at 30%, your credit score isn’t negatively impacted. However, when a credit card company swoops in and cuts your limit to $1100, you are now using nearly 90% of your available credit. In other words, you’d be maxed out.
Things Are Getting Worse
The first people to get stung by credit limit reductions were those on the border of good to average credit. These consumers started getting hit soon after the collapse of Lehman Brothers in the fall of 2008. Now, however, we’re getting emails from customers who have good credit, always pay on time, and aren’t even close to maxed out. And the trend is getting worse.
A recent www.bloomberg.com article penned by Alexis Leondis contains this startling observation;
“About 45 percent of U.S. banks reduced credit limits for new or existing credit-card customers in the fourth quarter of 2008, according to a Federal Reserve January survey of senior loan officers. Financial institutions may slash $2 trillion in credit- card lines in the next 18 months, Meredith Whitney, a former Oppenheimer & Co. analyst, wrote in a Nov. 30 report. “
Based on a number of email and blog comments we’ve received, the timeline for these credit limit cuts has probably decreased from 18 months to today.
What You Can Do When Your Credit Limit is Decreased
1. Act QuicklyWhen you learn of a credit limit cut, especially one that puts you at or near your credit limit, you need to move very quickly or you risk falling prey to numerous traps. Here’s one example: Let’s say your limit gets cut to $100 more than your current balance, and you have an auto-payment set up for $101. When that goes through, you’ll not only go over your limit (and get hit with a fee) but also, you will have given the credit card company a legal and legitimate reason to raise your interest rate.
If you fall into this position, make a payment to your credit card online or by phone immediately and cancel any auto pays you have in place.
2. Apply for a New Credit Card: It takes a few weeks for changes by your credit card to hit your credit report. If you apply for a new credit card immediately, you may be able to get approved before your credit score decreases. This will not only give you access to credit, but it could also help your credit score, as you will now have more credit available to you (For information or to apply for a new credit card, you can compare offers in 0% APR credit card section of this website.)
3. Pay Down Your Credit Card Debt: While obviously easier said than done, paying down you debt will help limit the damage done to your credit score. However, there are a few things to be careful of. For example, if you think you will need this money in the near term, you’re better off holding on to it and worrying about your credit score later.
4. Monitor Your Credit Closely: If you’ve recently been clobbered with a credit limit decrease or another adverse credit event, you may want to check out your credit score. There are a number of websites that offer free credit monitoring trials for 30 days that provide you with access to all three of your credit reports and scores. These sites also have tools that enable you to estimate how certain events, such as getting a new credit card, will change your credit score.
Final Words
Unfortunately, all consumers are now at the mercy of our desperate banks. In the short term, its always best to plan for the worse. Today, that means staying on top of your credit card accounts, paying down debt, and vigilantly defending your credit score. Getting your credit limit cut in times like these is the last thing most of us need. However, smart, decisive action can help you avert the worse.
For additional information on credit card offers and free credit reports, please visit the main section of our website by using the links to your left.
Related Posts
- Credit Card Interest Rates Keep Rising The most recent Federal Reserve survey of loan officers reveals that credit card companies have or will be increasing interest rates on 54% of customers with good credit. Yet another reason to lock in a 0% balance transfer rate and focus on repaying credit card debt asap....
May 14th, 2009 at 10:33 pm
I disagree with some of your comments, First of all, if you have a card where the limit has been lowered, it is a very bad idea to pay off any of the rest of your cards. There are many reasons for this. First of all, if one CC company has done it, the rest will usually fall in line. Especially, since the one being lowered will lower your score more. Secondly, the way CC companies usually lower your limit is to wait until you pay it down, and then they lower it. If you have a decent amount on your card, it is best to just pay the minimum, and use or save the money that you were going to pay it down with. There is another game CC companies play. If you have charged over 50 percent on your cards, your fico score is lowered. If you try to pay it done so that it is lower than 50 %, they will lower your limit so that you are still over 50%. This has happened to many of my friends and my wife. Wells Fargo even did something that I thought was illegal. They lowered her limit to just below what she had on the card, and then started charging her over the limit fees. She then paid it down, and they lowered her limit again, and continued charging her over the limit fees. Then they used the excuse that she was over her limit to cancel her card, and continued to charge her over the limit fees. This may even be illegal, but it would cost more to fight it. One thing that most people don’t know, is that they have a right to add a comment or explanation to their credit report. Some credit companies will actually look at the report.
May 15th, 2009 at 9:53 am
Denny,
I have to disagree a bit with your disagreement, though I appreciate your viewpoint and find your personal experience interesting.
As to the method by which credit card companies lower credit limits, no one outside the individual companies truly knows the logic. However, its always a good idea to pay down as much credit card debt as possible. What does a person benefit if they pay 15% interest on a $1000 balance while earning 1% on their cash?
Also, using less of your available credit does improve credit scores. Theoretically, a person with a better credit score is less of a credit risk, and thus less likely to be scrutinized for a limit decrease. Your experience seems unique compared to other stories I have heard.
You are absolutely correct about the comment adding. However, most credit card companies simply run credit numbers and ignore comments. Yet for mortgages or car loans, this may be helpful. Nevertheless, a better credit score carries much more weight than a comment.
Lastly, I am sorry to hear about the issues you have had with Wells Fargo. While not illegal, this is truly unfair. I hope you are able to get some resolution to this issue that will cut down on the penalties.
June 11th, 2009 at 8:24 pm
I agree with Denny. I had Chase credit card with a $2,000 credit limit and was too close to my limit. I owed them $1,950. I had some money for once and decided to pay it down. I paid it down to a $1,300 balance from the $1,950. Then within 2 weeks I got a notice in the mail that they lowered my available balance to $1,700. Why would they do this? I am trying to make signifigant efforts to pay off debt on my card which should help my FICO SCORE, and Chase is hurting my efforts. A decrease in my limit can have a negative impact on my FICO score
June 12th, 2009 at 10:28 am
Unfortunately, credit card companies are reducing credit limits so they can reduce their credit risk. The consequence of this is lower credit scores, which will ultimately allow the banks to charge us higher interest rates on mortgages, car loans, and other credit cards. Clearly, the banks stand to benefit twice-by reducing outstanding credit risk AND by charging us higher rates. Legal? 100%. Fair? Not even close.
Ultimately, opening up a new credit card with a new credit line is good line of defense, as it will soften the blow a lower credit limit will have on your credit score. Unfortunately, lower credit scores make it harder to get approved for new credit cards- this is a classic viscous cycle.
June 16th, 2009 at 5:40 am
My credit card had a limit of $2,500 with a balance of $13.86. I use the card only for iTunes purchases and pay it off monthly. I was shocked to receive a letter saying that my limit is being decreased to $1,000 due to “payments are low compared to balance owed” and “no mortgage loans.” I’m a graduate student earning about $11.00, who would give me a mortgage??? I have since closed the account- but I’m wondering, what will the effect be on my credit score?
June 16th, 2009 at 11:30 am
Kimberly,
Unfortunately, closing the account will probably have a negative impact on your credit score, especially if the account is your first and/or only credit card. Since the account is already closed, it is likely that there will be some damage to your credit score. However, opening a new credit card account with a different company may help offset the credit score decrease. The sooner you open a new account, the more likely you will be granted approval, as your credit score will not reflect the damage from the closed account until the other company updates your account.
Also, the reasons you state for the credit limit cut are completely absurd. Its as if too random reasons were pulled from a hat!
June 18th, 2009 at 9:24 am
I agree with Denny. The more you pay the more the credit companies can cut from credit lines. You are better off paying the minimum and putting the rest of the money in a savings account (In case of job loss). I have had this happen credit limit $6,000 balance $4,500. They cut the limit to $ 4,700.00, pissed I payed it off. Yesterday the limit was reduced to $1,000. Don’t help the credit card companies put the screws to you.
June 23rd, 2009 at 8:09 am
I agree with Denny. My husband and I had a Washington Mutual account that was of course taken over by Chase. It had a $9000 credit limit. We made two large purchases in March and maxed out the card. We just made a $5500 payment the other day and when I went in to make sure it had cleared I noticed our limit was lowered to $3700. We aren’t over the limit but we are very close now. I know I can’t close it because that has a negative affect on our credit. I guess we’ll go back to paying $200/month with interest.
July 3rd, 2009 at 12:40 am
I have a similar story to Cheryl and Rick. I had a WAMU card with a $9500 limit which was maxed and I had just paid it down to $5800, significantly improving my credit score. Chase just sent me a letter today saying they were cutting my $9500 credit limit to $6300!
On top of this they have been and still are charging me 30% APR!!! I called them and they said there was nothing they could do.
Chase are evil scum. The government gave them a sweetheart deal taking over WAMU and now they are screwing us. I was hoping to be able to refinance my mortgage and now thanks to the !@#$% bastards at Chase my credit score will suffer and I may be trapped in a subprime variable rate loan with interest rates set to soar.
July 10th, 2009 at 10:51 am
I have had the same problem with a WAMU card acquired by Chase. I had a $4600 limit with a $4000 balance. I just paid off $3700 of it in a month, and they decreased my limit to $2800 now. I have not yet received a letter from them, but I am pretty angry. I was apying 31.74% interest on the card, so paying it off made perfect sense, and paying off cards should increase my credit by decreasing my balance-to-limit ratio. It looks like WAMU/Chase is following suit and purposely trying to lower my credit by decreasing my limit. I hope they [expletive deleted].
July 13th, 2009 at 12:16 pm
I guess this is becoming a chase bitch fest, they just did that to me, I am trying to purchase a home. paid them off. balance of 1300 zero now. credit limit 2000, 1000 now, due to adverse items on my credit, while on the phone with them pulled from experian and found no adverse new items, score had even increased, 705, but i was told to wait for the letter they have sent out. dam this bill of rights for the people to help against the card companies can’t come any sooner. This unfair practice has to stop, they say the econmony is hurting This has to stop how is it supposed to get better if they keep dragging everything down. pay offyour debt, check, lower you credit limit, check, score goes down, check, I have found local credit union’s have the best rates right now.
August 12th, 2009 at 2:03 pm
I have to agree with Denny also. I have a Bank of America card that was originally limited to $40,000 (probably a little higher than it needed to be) it was reduced in January of 2009 to $14,400 at the time there was no balance and I was okay with the decrease. We began using he card for trips and various items and as we developed a balance our credit limit was decreased. I was a victim of identity theft and it showed derogitory crdit on my bureau because of that. I have everythin removed from all 3 bureaus now and today received a letter saying my limit was being decreased again. When I called to talk to somebody about it they claimed the reason for the recent decrease was 2 late payments from 43 months ago that were on my credit well before we got this card. As of today my average FICA score is 736 and this is still happening to me and there is nothing I can do about it. Seems a huge injustice is being done to the American people. Our society is continuelly being kicked while we are down. Bank of America received more Tarp money than any other bank and what did they do with the money??? How about buy Countrywide Home loans. Our tax dollars hard at work for us once again!!!
September 4th, 2009 at 9:39 pm
I think i have the best of the worse stories. in december 2008 i was told my credit interest rate was being raised on various accounts.DID HAVE 0% 1.99% 2.99 ETC. I have ALWAYS,ALWAYS paid on time and more than the minimum. I started the snowball plan to pay down my $37,000 in credit card debt.Each and every card I paid down by thousands of dollars the companys decrease my limits and as soon as I paid them OFF they closed my account. I have paid off over $25,000 since January (by taking on a second job) and my rates finally dropped to $500 limits and then closed by banks. I keep thinking i am getting close because the more I pay the greater my ratio will be -NOT!!! I owe now 13,000 on 3 cards and one of them just inforned me of a decrease after my $4,000 recent payment which should have brought me to the 20% range-but now I am at 98% of my limit-I can guarantee they will close it too. my credit score went from 760 to 549 while I was on my best behavior reducing my debt. My game now is who will be the last card standing because they alone will get my business for the rest of my life-AMEX-worse i went from 17.000 limit to 500 and then they closed me two days after my last payment,THE LESSON I HAVE LEARNED IS IT MAKES ME MAD TO LOOK AT OR USE THESE CARDS AND IN THE LONG RUN I WILL COME OUT AHEAD-DEBT FREE-USING CASH ONLY-THEY ALL LOST A VERY GOOD 100% PERFECT PAYING RECORD CUSTOMER-BYE,BYE TO THEM ALL-SO NOW I AM DOWN TO CITI AND CHASE -WHO WILL WIN MY LOYALTY AND BUSINESS-I POST AGAIN ONCE I PAY THEM-IT MAY BE NOONE IF THEY ALSO CLOSE ME DOWN-THEY BROUGHT ME IN WITH 1.99% RATES AND I TOOK THE BAIT AND NOW THERE WILL BE WHOLE COUNTRY OF RESPONSIBLE PAYERS WHO WILL LEAVE THE PLASTIC BEHIND AND BANKS WILL BE HURTING FOR THE STEADY CUSTOMERS-THEY WILL BE STUCK WITH THE BAD PAYERS OR THOSE WHO ONLY PAY THE CARDS OFF 100% EACH MONTH-WE WERE THE BACKBONE OF THEIR WEALTH-THEY MADE INTEREST ON ME AND I PAID ON TIME WITH EVERYTHING GOI I WILL BE DEBT FREE by the end of the year-IF I KEEP MY SECOND JOB MAYBE next year i can make another 37,000 and I CAN BUY A CAR WITH CASH since i won’t get a good car loan now I HAVE busted my butt and EARNED AN EXTRA 37,000 IN A RECESSION IN ORDER TO BE DEBT FREE-AND OUTSIDE OF A MORTGAGE I WILL STAY DEBT FREE SO WHO CARES ABOUT FICO NOW (I ALREADY HAVE THE MORTGAGE AT 5%) AND I NO LONGER SHOP EITHER -THIS ALSO HELPS ME OUT-IT CAN BE DONE -IT’S JUST REALLY HARD BUT I SEE THE LIGHT AT THE END OF THE TUNNEL AND I WILL BE THERE SOON-GOOD LUCK TO EVERYONE WHO HAS BEEN SCREWED LIKE ME-FICO ONLY A NUMBER YOU ARE #1-LETS RATE THE BANKS WITH A SIMILAR SYSTEM AMEX STARTED IT ALL FOR ME -THEY WOULD GET THE LOWEST SCORE
October 20th, 2009 at 6:51 pm
Has anyone considered a Class Action lawsuit against banks? Typically I am against lawsuits, however it is obvious they think they can damage a persons credit report without consequence. I personally was damaged as my credit score went down enough where I could not get a loan needed. They are obviously damaging consumers in mass.
October 21st, 2009 at 10:47 am
I am aware of at least one that was filed against Chase regarding the change of fixed rates to variable rates, but am unaware of more general ones filed against other companies. The unfortunate reality is that most credit card companies are engaging in unfair, though entirely legal tactics.
November 2nd, 2009 at 3:21 pm
I just activated my new card in Oct 09 that expired at the end of 09. Today, I got a notice that my credit limit of $38K was being lowered to $20K due to economic trends and due to the fact that I had sufficient credit. I owed a $0 balance but I am concerned with the impact this is going to have on my FICO score which is in the top 1%. I have another credit card with a $28K limit but I pay the balance every two weeks. I carry no credit card debt from month to month, just mortgage loans. Should I be concerned with this limit decrease.
November 3rd, 2009 at 2:37 pm
Gina,
In all likelihood this should not impact you negatively, as the decrease in your credit limit will not cause your debt to available credit to increase. If you wanted a general estimate, many free credit score products provide tools you can use to analyze the impact of a credit limit change to your credit score.
November 10th, 2009 at 2:17 pm
I just had $30,000 in credit limits across two cards cut to $13,000 yesterday. Both these cards are owned by Citi, and I have had each of them for more than 10 years and never made a late payment. This caused me to go from a little over 40% utilization to approximately 97% utilization.
So reading this I am guessing I need to get a new card before these limits hit the agencies, but is that really all we can do? Is there no way to avoid the screw job other than paying every card off with the possibility of having the companies close them and cancelling out any headway you have made by making payments?
November 10th, 2009 at 2:58 pm
Gus,
Unfortunately, getting a new credit card fast is the best and easiest way to prevent your score from taking a big hit. The other option is to pay off the debt, but most people are not in the position to do so immediately. You may want to consider getting a new card that offers 0% balance transfers, as this will help reduce your interest costs and stop the flow of money from your bank account to Citi’s.
November 16th, 2009 at 10:01 pm
Does any one know if a credit card company can decrease your credit line in a closed account by cardmember?
November 17th, 2009 at 10:36 am
Vladimir,
Credit card companies can decrease credit lines at any time for any reason. If you are concerned about having your credit line lowered, open up a apply for a new credit card to gain access to additional credit.
November 25th, 2009 at 2:07 pm
well supposly my creidt limit was decrease from a $5K to $1800 i just spoke to a rep manger and he reinstate that for me which it did report to the 3 beur which cost me over 20points, i’m just on way to dispute this with the three agency repairing my creidt score. becasue i still have 14 days grace period from the adverse letter which was sent out to me.
December 19th, 2009 at 7:29 am
It’s happening to everyone. Almost everyone has experienced lower credit card limits. The banks are doing this to survive the mess they caused themselves. Unfortunately the Government won’t allow them to fail, because that would have even more devastating consequences to the economy, let alone the credit card industry. Regardless, the Government, and the Obama administration should do something about the massive credit limit lowering and make it illegal and only based upon payment history critera, rather than the arbitrary critera banks are allowed to use currently. For that matter, credit scores should not be based upon lower limit to balance ratios, but instead only on how card holders handle paying the amount due on time.
December 21st, 2009 at 11:38 am
I agree Bryan, especially on the calculation of credit scores. In a normal environment, credit scores were effective. However, when random, unrelated and often unjustified credit limit decreases come into play, the cost of credit can skyrocket simply because credit reporting agencies don’t take larger economic events into consideration.
December 29th, 2009 at 9:12 am
I just had Chase Chase cut my two cards limits as well. I have no late payments and this is hurting my credit score. I think we are pretty much helpless here but I would suggest filing complaints with your state Attorney Generals. It may not do anything intially but if they get flooded eventually something will get done. Be proactive! Most state have an online form you can fill out in 5 minutes.
January 3rd, 2010 at 8:46 pm
Chase, gave me a $3,000 limit credit card in February 2008,then raised the credit limit to $4000 a few months later in August. I used about $2200 of the balance, paid on time and then paid off $2000 on the card in October 2009, which left a grand total balance on the card of about $230. On December 29th, I recieved a letter stating that my new limit was $1000. So in a nutshell my good payment history and low balance on the card meant nothing. They’ve decided to arbitrarily hurt my credit score by reducing my available credit. I intend to call them tomorrow, voice my grievance and immediately terminate the card. I have others, so maybe closing the account won’t hurt me too bad but I refuse to be held hostage by greedy,deceitful banks and credit card companies. I am intending to start using my local credit union for the bulk of my financial transactions. Screw Chase Bank. Any company, product or sevice that I find out is affiliated with Chase will never get another dime of my business, period.
January 5th, 2010 at 2:28 am
Same story here – Chase card, limit of 16k reduced to 11.5k, balance of 1.2, limit dropped again to 2.5. Suddenly, I would have difficulty even booking travel or handling an emergency situation now. Recieved note on Saturday that it was based on information from Equifax, where my rating is in the “excellent” arena.
My thought was to: a) complain to State authorities, checking out where best to go with this, and b). Quickly getting a new card or cards to bring my available credit back up and avoid score reduction.
My question is this: where is the best place to go? Local credit unions? One of the offers in the link referenced above? I’d like to go where it is most likely that I will be granted the $9k that was reduced, and where this is least likely to happen again (probably not with any of the big banks again). Do you have any advice regarding where it is most likely that I won’t go through a credit check, which will also hit my credit reports, and end up getting the most (highest line) for my application?
Thank you for the advice!
- Jim
January 5th, 2010 at 2:30 am
Oops, last comment I meant most likely that I will get the most for a. Credit check, not “won’t” – hopefully the intended comment was clear!
January 21st, 2010 at 4:16 pm
I have just got a letter from Capital One saying my credit limit has been decreased to nearly half, leaving me with $200 dollars play for any interest rates. They said they looks at my credit report and compared ALL my credit cards to come to this decision. My credit is great, work hard to make all my payments on time. Never go over my credit limit. I don’t remember reading a comment regarding Capital One so I posted this. I told them I will pay this off and close the account in the next month. I’m not understanding the logic and I bet anyone who actually works for these companies do not have the same issues as we do.
January 22nd, 2010 at 11:06 am
Tanya,
For a while it seemed credit limt cuts were slowing down. However, I anticipate many people will find themselves in the same position as you once the new credit card laws kick in. Since credit card companies won’t be able to raise your interest rates, they may resort to cutting off credit limits to force you to pay down your balance, which will have a lower rate. They can then increase your interest rate on new purchases, which is a loophole in the new law.
Just to be sure you didn’t miss any changes in your credit profile, you should use a free credit report service to check your scores and see if they are basing it on a change that you weren’t aware of, including a mistake.
January 28th, 2010 at 8:49 am
I found this site after getting my very own “We have recently reviewed your account history…” letters from Barclays and BofA. I too have always had excellent credit and paid on time. I’d like to share an idea that I learned about on Huffington Post.
It’s called Move Your Money (moveyourmoney.info). The basic premise is that we should ALL be taking our business from these greedy behemoths and instead banking with our local credit unions or community banks. They are the ones that did not need TARP and are best positioned to extend credit to us and our local businesses. The site has searchable lists of banks in your area.
The idea has received some coverage from the media but more people are embracing it every day.
I encourage you to check it out. I am on a mission to dump my Citi, Wells Fargo, BofA, Barclays and any other big name, Wall Street scum I can find in my wallet. Good luck!
January 28th, 2010 at 2:00 pm
Hilley,
There are a lot of pluses to using a credit union. I wrote yesterday about how credit unions can be helpful for people looking to repair bad credit, as they are more likely to treat their customers as human beings instead of numbers. Of course, there are benefits to banking with the larger institutions. Unfortunately, those seem to be disappearing every day.
Note: I disabled the link to moveyourmoney dot info because it was unverified by Norton safe web and I don’t publish links to sites that may pose risks to my readers. The site is linked from the Huffington Post, but for the time being, I have to protect the security of my visitors, so please use discrection before choosing to visit the website.
January 28th, 2010 at 11:59 pm
This information regarding Chase is very helpful. Consumers should ban together and dumb these greedy banks!
January 31st, 2010 at 3:32 pm
Chase reduced my credit line in 2009 then shortly after they decided to take me to some crazy variable rate APR. I opted out of the account and am continuing to make payments at the original (much lesser) APR.
Today, I got a recorded message from CitiBank telling me to call them immediately regarding my c/card account. When I called in, the recorded voice gave my balance (which sounded right) but then gave my available credit of $37!! I almost died. Thought someone had stolen my card info or something. Basically they just decided to reduce my credit line by many thousands of dollars for no good reason.
I suspect the new laws that come into effect on Feb 13th have something to do with this – that and the fact I’ve been on a special 0% APR with them (so they haven’t earned any money from me).
Essentially, I’ve never missed a payment in my life and as far as I know my credit score is up towards the perfect end.
When I called to find out what the deal was, I canceled my enrollment in credit protector which was costing me a good $50 a month. I had done the same with Chase last year. I don’t really need it and at least it made me feel like I got some form of revenge.
February 1st, 2010 at 11:37 am
Nick,
I’m more than a little worried by your comment. I think you nailed it on the head. This is likely because of the new credit card laws, and I’m afriad this is going to become a big trend.
If you need more available credit, I would recommend applying for a new credit card as soon as possible. When your decreased limit is posted to the credit bureaus, it will show that you are essentially maxed out on your Citi card. This increases your credit utilization ratio, which accounts for 30% of your credit score, and could cause other lenders to deny you credit if you need it as a safety net.
We list applications for 0% credit cards on the main part of our site (you can view offers here), but I don’t care where you apply. I’m not telling you this to drum up business. I’m telling you to get a new credit card as soon as possible because I believe it will be difficult for you to do so once you’re new limit hits your credit report.
Lastly, you may want to keep an eye on your credit score. We list free credit score offers on our site (you can view them here).
February 7th, 2010 at 12:00 pm
Thanks Balance Transfer Helper! I had been receiving stuff in the mail from Discover forever (maybe once every two days). Seemed like they really wanted my business and, after what Citi just did to me, they got it. I applied for the card 0% introductory offer and got it. Limit is quite low at $2,000 but at least it’s a third of what Citi just took away. I also applied for Compass Banks “Clear” offer – very low APR – still awaiting an answer on that one.
The bottom line is I have about $5,000-$6,000 currently readily available to pay off some c/card debt. I think I’ll utilize about $2,000 of this to pay off some debt (after Feb 22nd of course) and leave the rest in the bank for now until I get a feel for what’s happening.
I don’t want to pay off too much off one particular card in case they reduce my limit even more.
Once this all blows over and the economy is booming again and the banks are keen for the business again, I *WILL* definitely remember who screwed me over.
Also, let’s all not forget… whenever you deposit money into your bank account you are effectively *LOANING* your money to the bank!! So, if a particular bank has screwed you for no good reason, you might want to consider “loaning” your money to another bank (preferably a smaller local bank or credit union) that would appreciate your business more.
February 8th, 2010 at 9:31 am
Thanks for the kind words and good to hear you’re able to grab credit at good rates to make up for the credit limit cut.
You make a really good point about where we put our deposits. With interest rates so low, many of us are essentially giving the biggest banks interest free loans-and they’re using the money to lend to our friends and neighbors at 29.99%. Credit unions are really a good place for people who want to fight back against the banks that have hurt them.