Credit card shock

[LemonLass]

Hi all
Just shocked to received a text from my credit cars co advising that my credit limit is £1,250 with immediate effect. Shocked and wanted to warn others who use their card, especially if you are unable to pay whole outstanding amount off each month.

My credit limit was £9,000. I have had the card 8 years. They put the credit limit up each year but I have refused the last few of their proposed increases as I dont go near the top end and no big purchases planned (where you would have some protection from a purchase on credit card eg faulty goods).

My credit score is good (700+) with agencies whatever that means 😄 I have not missed payments on any bills or "mis-used" the card.

Luckily my current balance is under that amount and I will get it paid in full ASAP but what if I couldn't? Had given me a bit of a shake!

Has anyone else experienced this?
X

I’ve just checked mine out of curiosity.

it is TransUnion and my score is 620, “Good”.

Above 627 is in the “excellent” category.

I’m really surprised, I thought mine would be better.

I clicked into things affecting my credit and apparently the biggest contributor is that I’ve been on electoral roll less than 6 months (moved house in January).

The next one is that I have available credit of £5k…..if I increased it to £15k my score would improve, apparently.

seems strange to me.

My bank did the same to me with my overdraft limit on my current account. I had a £5,000 limit (which I didn't use, but was handy to have in case of emergency car bills etc), and which they themselves had increased to that figure. It had originally been a thousand and they'd kept putting it up and up. One day I got a letter telling me that they were reducing it to £100 and like it or lump it.

Experian is the most common CRA in the UK & mine is 999/999 on there, that's what I based my comment on.
@LeonardBobby

@chewbecca yes I thought you probably weren't familiar with the other CRAs when you told the OP her 700 score was good / amber. It's impossible to tell unless you know which CRA it came from.

Maybe because they aren't making any money out of customers like us?

Up until now, it has been reassuring to have the capacity to pay (and to those that say I understand we all should build up savings but there isnt much going into savings and 'spare' with all the cost increases) for big expenses and have a few weeks gap to pay off in full. My monthly spends typically £2k but the card has gone from 9k to £1,250.

My monthly spend isnt on the card thankfully btw. Maybe I should have!

It really isn't. I have a fairly high salary, put 2k in savings each month and Ive paid off my mortgage. My outgoings are very low.

Do you have a family?

The immediate effect part is because people who are struggling would be tempted to go max out the card, take cash from it etc if they gave them a few weeks notice.

You are taking this very personally, it’s a computer that’s gone through all the accounts. They may even reverse the decision if you talked to an actual person.

Thanks Dueanamechange2025. That makes sense how some notice may trigger silly spend season.
I am taking it personally in that it has affected me personally - it was handy to have for booking holidays or bigger items (when I had the cash saved).

I was complacent. This was unexpected. It didn't (and still doesn't really) make sense why but your answer about immediacy has helped. Thank you for that.

Surely the lesson from that is not to do building work you can't afford?

Is that clear score? 700 with them isn’t a brilliant score

Folk should know better than to run up debt on credit cards when they can't pay it off. There is no logic to it.

Then problem appears to be not using it "enough" Viviennemary

I have used cards in the past - planned- to give me more breathing space (when I was single). It was about cashflow then but I dont think it rare that people do use cards to get by regularly. It is expensive if you have interest but cards I had were 0%. It depends on the person and what they are comfortable with?

My post is about immediate drastic reduction in credit limit though.

That happened to me. I rang and the nice lady said that was the case unless you requested it to be reinstated and I ummed and ahhed thinking that would be a massive form to fill in etc and then she said it again and I finally twigged what she was telling me so I said "I would like it reinstated" and she pushed a button and said all done. I have c£15k credit. Never use it but feel unsafe if it's not there

Thanks everybody, this is all very helpful to know. We haven't bothered using our credit cards much recently and have assumed that the high credit limit would remain available for emergencies and for the added buyer protection on large purchases.

This has prompted me to return to putting more of our routine spending on the credit cards, which we pay off in full every month.

Also thanks to @PicaK for mentioning that it might be possible to ring up and ask for the higher limit to be reinstated. We'll bear that in mind as something to try.

I do all my monthly spends on a CC and have a DD to pay in full each month, so I don't pay interest and it seems to keep them happy. I do it for points / cashback mainly.

I had this recently my credit limit was £4k it was that when aI got it and it’s been the same for years. I spend about £1k a month and clear it in full. They cut me down to £2300 it’s irritating as it looks like I’m using over 25% of my credit which has a knock on effect on rating?

Exactly, Lovelysummerdays

Using around 1k of a 9k limit good for my rating and useful for me but keeping to 25/30% of £1,250 is not very useful for spends

I have an email recently telling me my limit was reducing by quite a lot but if I contact them it would stay the same. I did contact them as o always like to have credit cards as a back up.

It's a way for finance companies to reduce their liability figures they aren’t making money on. If we've all got thousands and thousands of credit not being used if they remove it then it makes their figures look better

I got a letter from Barclaycard on Friday saying they would reduce my unused limit by £4k but I could use it or text them to keep it the same limit

it does seem strange though @LemonLass they've said yours is from immediate effect. I've got till May to decide

It does seem unusual and it was a text. I signex into CC and checked and my credit limit has reduced to the amount given in the text. I am puzzled.

People often use credit cards as there’s more protection on them than say a bank transfer when it comes to paying for things