Banks Lowering Consumers' Credit-Card Limits - Credit might disappear without you knowing it

[NNN0LHI]

http://www.ktka.com/news/2008/oct/09/credit_might_disappear_without_you_knowing_it/

Credit might disappear without you knowing it

Story by KWCH-TV

9:55 p.m. Thursday, October 9, 2008

You use your credit card for a lot of things...

"More than I probably should," John said.

"I pretty much just charge everything," credit card user Elise Fischer said.

Food, shopping, filling up...

"I used them for emergencies for awhile, and now we're paying them down," John said.

But be careful.

Like a lot of things, there's a limit to how much you can use it, and it's shrinking.

With the looming economic crisis, companies are cutting back how much credit they offer.

"Don't you think they should let you know if they're going to drop it, or they're going to lower it? So you can kinda plan on your budget?" shopper Loretta Hoffsetz said.

"It's because they've told you they can do it as part of the contract you signed when you got the credit card," Consumer Credit Counseling Service's Tim Hagan said.

So they may drop your limit and not tell you.

[semillama]

1. Well, that might not be a bad thing

lower limits = lower total amount of debt you can get your self into with the company.

Of course, if they lower your limit to below how much you currently owe, that's another matter.

[no_hypocrisy]

2. I'll probably get dropped b/c they don't make a cent off me.

I use it 2-3 times a month, pay the full amount and on time. No late fees, no interest.

[kath]

5. Oh, they make money off you - they get a percentage of each and every transaction.

[NNN0LHI]

6. Every time you make a purchase they make money

They get a percentage of all sales.

Don

[napi21]

8. I doubt they'll drop you! Remember, they make money from the

merchant every time you use that card. Granted, they don't make as much as what they make on interest & fees, but you (and I0 are guaranteed cash flow for them.

[Why Syzygy]

3. Kohl's did that to me three years ago.

Never notified me. They lowered it BELOW the amount I currently owed, and I made payments on time EVERY TIME. I haven't shopped at Kohl's since and never will. Too bad. When it comes to being a CONSUMER, I hold grudges. I walked out of Montgomery Wards YEARS ago because they wouldn't finance an appliance for us, even though we had perfect credit and a credit union that would loan us on signature. Never went back. They are GONE. No more monkey wards. More people need to demand fair treatment, or even more.

[spinbaby]

13. I hold grudges, too

25 years ago, we used a Sears credit card to order a storm door from them. 6 weeks later we still didn't have the storm door but they had charged us interest on it. They didn't fix it, we cancelled the order, and we haven't been back since.

[napi21]

4. I seriously doubt they'll lower the limits on any customers that

don't or haven't triggered some warning signs of inability to pay. If you make a payment late, always charge close to your max, etc. then you need to be concerned. If you pay your account off every month, I doubt you have anything to worry about.

[Why Syzygy]

9. Not true. They will do it for any reason.

Their profits are primary concern. Not customer satisfaction.

[supernova]

10. They can change the rules anytime

for any reason, and in many cases only have to give you a cursory notification, if at all. The fine print in the agreement spells that out.

[napi21]

11. Of COURSE profit is their primary concern, but when they make a profit

from every transaction I do, and ALWAYS pay my bill in full, THAT's not only profit, but cashflow for them. Truthfully, I don't care if they lower my limit! I thought they were insane for giving me that high of a limit to begin with! I NEVER even come close to using 15% of it!

[supernova]

7. Glad for my debit card

[ITsec]

12. Which is why I check my CC's once a week online...

and pay the balance in full well before the due date.

The only "surprise" I've seen is 3 of them had interest rates go up a half to 3/4 %.