CC limit decreased

[chstr]

they are trying to avoid people that lose their jobs from paying off the debt that cant be cancelled in a chapter 7 with their credit cards before filing, because cc debt is cancelled in chapter 7.

 

[sushi]

^ One reason interest rates are so high. The credit card companies have to make up for losses due to some card holders not paying back what they owe.

I know of one individual who ran up 80 grand in cc charges. Declared bankruptcy. Then did it again. Only about 70 grand the second time. Declared bankruptcy a second time. About 150 grand in cc debt erased.

 

[CalBoy]

Was this the same for you? Did you ever use your card before you didn't, if that makes sense?

I had used it for a bit in the beginning (maybe 6 months), but then pretty much left it to be my "emergency" card.

 

[sushi]

I had used it for a bit in the beginning (maybe 6 months), but then pretty much left it to be my "emergency" card.

Same here.

So it looks like the credit card companies are strictly looking at a use or loose concept. Granted both of use hadn't used our cards in over 24 months but you would think they would send a letter letting you know that you need to use it if you don't want to loose it.

 

[mysterytramp]

^ your credit score could decrease because you no longer have the same amount of credit.

example: before they cut it you had $10k. after the cut you have $5k. So you've now lost $5k in credit which negatively effects your score.

Or ... you could just go out and get another card. Despite the crappy economy, there's no shortage of plastic.

mt

 

[gnasher729]

^ your credit score could decrease because you no longer have the same amount of credit.

example: before they cut it you had $10k. after the cut you have $5k. So you've now lost $5k in credit which negatively effects your score.

I would think high credit card limits would count against you. Say you want to borrow $20,000 to buy a nice new car. According to your income, you can afford to pay back the money. And according to previous history, you are not in a habit of missing payments. So everything is fine. But if you have ten credit cards with $10,000 limit each, you could spend $100,000 on a whim, with no chance of paying it back. So the car company cannot be sure that you can pay tem back.

 

[Teh Don Ditty]

Or ... you could just go out and get another card. Despite the crappy economy, there's no shortage of plastic.

mt

I did mention that in one of my other posts if I'm not mistaken.

I would think high credit card limits would count against you. Say you want to borrow $20,000 to buy a nice new car. According to your income, you can afford to pay back the money. And according to previous history, you are not in a habit of missing payments. So everything is fine. But if you have ten credit cards with $10,000 limit each, you could spend $100,000 on a whim, with no chance of paying it back. So the car company cannot be sure that you can pay tem back.

It goes both ways (no pun intended) If you have those 10 cards with $10k limits and you've used only say $20k spread across the 10 cards, most companies will say he/she uses their credit wisely.

The thing with auto loans is that they have collateral (the car) so they won't have a problem extending credit. They could always just give you a loan with a higher interest rate, if they so desired.

 

[rhett7660]

One of my credit cards was recently cancelled.

I received a nice note that I was in good standing but it appeared that their product did not meet my needs and therefore they cancelled the account. Their basis was that I had not used their credit card in over 24 months.

Personally, I kept it as a backup in case of emergencies.

This has happened to me also. Thank god I have another one from my bank to use just in case of the unexpected emergency that life tends to throw at you.

 

[sushi]

This has happened to me also. Thank god I have another one from my bank to use just in case of the unexpected emergency that life tends to throw at you.

I guess the morale to the story, is to use your card every once in a while -- say at least every year -- to keep it current.

Probably a simple grocery or gas purchase would be plenty.

IMHO, it is much easier to keep a card than get a new one for emergency purposes. That is assuming that you spent time doing some research to find the cards that provide the best options and rates for your needs.

 

[barr08]

I guess the morale to the story, is to use your card every once in a while -- say at least every year -- to keep it current.

Probably a simple grocery or gas purchase would be plenty.

IMHO, it is much easier to keep a card than get a new one for emergency purposes. That is assuming that you spent time doing some research to find the cards that provide the best options and rates for your needs.

I have one CC which I use for all purchases over $100. Most often, I pay off whatever I spend right away, but I want to keep the credit card active. Having a Bank of America credit card and bank account is great, because I can just go on the site and transfer funds around every which way!

Edit: I'm a 22 year old just out of college working in IT, so I may not be in the same situation as some of the other ppl here.

 

[Rodimus Prime]

I guess the morale to the story, is to use your card every once in a while -- say at least every year -- to keep it current.

Probably a simple grocery or gas purchase would be plenty.

IMHO, it is much easier to keep a card than get a new one for emergency purposes. That is assuming that you spent time doing some research to find the cards that provide the best options and rates for your needs.

That is one way to do it. I currently have 2 credit cards. My primary is an american express so at times I am forced to use my back up card.

I am thinking about getting a 3rd credit card. The 3rd card would go in a desk draw and hardly ever be used. I would mostly have it in case I lost my wallet so I would still have access to my money while everything is being replaced.

 

[Zombie Acorn]

^ One reason interest rates are so high. The credit card companies have to make up for losses due to some card holders not paying back what they owe.

I know of one individual who ran up 80 grand in cc charges. Declared bankruptcy. Then did it again. Only about 70 grand the second time. Declared bankruptcy a second time. About 150 grand in cc debt erased.

He would have had to wait 8 years in between filings if he went for chapter 7 (complete wipe), in which case the bankruptcy would have been on his record for ~10 years, so if a credit card company let him have limits up to 70k within 10 years time I blame them. Its like giving drugs to a crack addict and expecting them back at the end of the month.

 

[Teh Don Ditty]

^Bankruptcy policies aren't the same everywhere in the world.

 

[Zombie Acorn]

^Bankruptcy policies aren't the same everywhere in the world.

I forget that we have a more diverse geographical group here.

 

[ucfgrad93]

I know of one individual who ran up 80 grand in cc charges. Declared bankruptcy. Then did it again. Only about 70 grand the second time. Declared bankruptcy a second time. About 150 grand in cc debt erased.

While I don't know the situation, and I could be totally wrong in my judgment; but this person sounds like a real scum-bag.

 

[Teh Don Ditty]

I forget that we have a more diverse geographical group here.

It's ok

 

[dukebound85]

I guess the morale to the story, is to use your card every once in a while -- say at least every year -- to keep it current.

Probably a simple grocery or gas purchase would be plenty.

IMHO, it is much easier to keep a card than get a new one for emergency purposes. That is assuming that you spent time doing some research to find the cards that provide the best options and rates for your needs.

i use both of my cards all the time

the one that just got slahed had a balance of 2300 on it which i paid off in full. yet the cut me down anyways.

 

[Rodimus Prime]

Man if my primary CC had it limited cut in half it would hurt. Before I request the limited upgrade to 4k from 2k I was quite often bumping the edge of the limit. If pretty much forced me to pay it off as soon as the bill was sent and if I ran anything big I would have to pay down the balance before doing it.

Now with 4k it gives me more breathing room so I do not have to pay it off as soon as the bill comes.

I will like to point out I pay off the bill in full every time. Just I would rather not have to rush to do it and get to it when I get around to it.

 

[sushi]

While I don't know the situation, and I could be totally wrong in my judgment; but this person sounds like a real scum-bag.

He was and is.

It was amazing how quick he was able to build up his credit after going bankrupt the first time, only to do it a second time.

i use both of my cards all the time

the one that just got slahed had a balance of 2300 on it which i paid off in full. yet the cut me down anyways.

I have a couple that I use regularly.

I have a some others that are for emergency use only. They have larger limits.

Man if my primary CC had it limited cut in half it would hurt. Before I request the limited upgrade to 4k from 2k I was quite often bumping the edge of the limit. If pretty much forced me to pay it off as soon as the bill was sent and if I ran anything big I would have to pay down the balance before doing it.

Now with 4k it gives me more breathing room so I do not have to pay it off as soon as the bill comes.

I will like to point out I pay off the bill in full every time. Just I would rather not have to rush to do it and get to it when I get around to it.

I like having high limits so that I can charge what is needed.

I have a friend who unfortunately has had 3 family deaths since the first of the year and traveled back to the states each time. Plane, hotel, rental car, etc. costs add up quickly. Having a credit card allowed him to go when needed. Then upon return he an adjust/move funds as needed to pay off the debt. Very convenient in those types of emergencies.