To get really bloody irritated by automatic credit increases?

[PussyPatronus]

This morning I received a letter from my credit card company. It essentially said:

"Dear Mrs Patronus

As a favour to make your life easier, we're going to automatically increase your credit limit from X amount which you have never been anywhere near spending and couldn't actually afford to spend anyway to X amount which would wipe out your entire long term savings pot, even without the inevitable interest you would accrue.

Thanks awfully

CC company"

Now, luckily for me I am one of those pedantic people with a budget spreadsheet good with money type people who spends only what they can afford and pays off their bill every month. However, you don't have to look very far for evidence that not everyone is like me.

Isn't this just really irresponsible commercial practice? This company already make money by charging the businesses I use my card with and through discount deals with commercial partners etc. Now they want to profit more by encouraging me to get into debt?

I used to be crap with money and had three cards up to their limits. Every time I got close to the limit the increased it again ffs! I can proudly say this month I am finally cc debt free

I get like this with very. I hate shopping so I love being able to order stuff to the house. I opened an account four years ago with about £500 limit and they've raised and raised and now it's about £5500.

I just raise an eyebrow.

Fluffy, that's awesome!

RJ £500 to £5500 in 4 years? My point is made!

Many years ago I worked part-time in a department store and also had their store card. Credit limit kept being raised until it was higher than my yearly pay without overtime. Never spent anywhere near that much, obviously.

My basic pay was around £4,000 a year and my total credit available across various store cards and a credit card was around £10,000. Thankfully I had some sense and didn't go on a spending spree.

mirime that is the most worrying example I've heard so far! You might even have been in danger of not being able to afford minimum payments if you had lacked any sense!

Indeed! Scary stuff!

I thought these automatic increases could affect your credit rating negatively in a couple of ways.

Firstly, it increases the amount of credit available to you so even if you don't spend much (which does keep the debt ratio low) it still means if you want to apply for another form of credit in the future that you may be rejected due to the amount of credit you already have available to spend?

Also, if your credit limit has been increased automatically but then you ask/request it to be reduced (like a PP mentioned they were going to do) that this is also a negative for credit file as any credit limit change requested by the user is recorded on file.

Not sure how true this is. I find it a bit of a minefield to know what impacts credit scores, seems contradictory sometimes.

Your credit record shows available credit, but it also shows what you have used (and repaid) on a month by month basis @Panda81

So any new lender can look at what you have and what you do with it. Having a large limit but not using it and always clearing it is generally a big tick for new lenders -mainly they can see someone else thinks you are a good risk and your repayment record proves it; but secondly, the new cc company's risk is lower due to the other credit you already have available (not all your eggs in one basket)

My DH has a combined CC limit of about £22,000 due to increases and being given large limits in the first place. But we only use about £800-£1000 of it a month!

And I think he only opened his first CC account for under £3,000 3-4 years ago - so increased credit has been practically thrown at him since then.