What's the Rule for Credit Limit Reduction, AMEX?

I’ve always paid my AMEX on time and in full, yet they decided to
reduce my credit limit by $10,000
Amex also sent out a generic letter (not too long ago)to all its
cardholders announcing that going forward they are not going to honor
their AMEX checks that they just mailed you begging to use them,
furthermore they are eliminating all cash advances privileges!
This is unbelievable...as if they don’t want our business ...so by all
means please go ahead and cancel all your accounts with AMEX and
pledge not to do business with them ever....because that is what I
have done...

I have been an American Express card holder since the year 2000 and I
have worked extremely hard to build the credit that I had. I currently
have three credit card accounts with American Express. On my BLUE
credit card between 10/17/08 and 11/18/08 statements my credit line
was reduced from $48,000 to $40,000 (17%, within $750 of my balance).
During the same time period they imposed a $1,700 credit limit on my
ONE credit card which always had been unlimited. I had charged and
paid each month more than $2,000 consistently for years on that card
and now I had to scramble to move automatic payments, I had several
charges declined after the limit was set and was left with egg on my
face. After calling customer service several times they said this was
due to a credit review and there was nothing that could be done about
it. On 4/2/09 I was notified that my BLUE credit line was reduced from
$40,000 to $9,600 (76%, within $200 of my balance). After calling
customer service and speaking with a manager they said this was due to
a high debt/credit ratio and there was nothing that could be done
about it. I have never made a late payment and I typically pay much
higher than the minimum payment. At a minimum this is horrible
customer service and at a maximum they have severely impacted my
credit rating by increasing my debt/credit ratio. My debt/credit ratio
has not changed dramatically in over a year and my credit score is
over 700, what they are doing is completely arbitrary. I would not be
surprised if they lower my limit again in the near future as they are
now creating a self-fulfilled prophecy by manipulating my credit. From
the research I have done there are hundreds if not thousands of
customers being affected in the same way and I am looking for a class
action lawsuit to join if this can not be resolved immediately. I am
so unhappy that I want to immediately cancel all of my credit accounts
with American Express, the only reason I have not is it will hurt my
credit scores even more. Please help!

It's so sad that amex and other creditors can do this for whatever
reason and not have to explain themselves. I had a 15000.00 credit
limit, i havent used my card in a while. i charged $15.00 sent the
payment same day, my limit was reduced to $500.00 . mind you over the
past 12 years i have been late 0 times to any of my creditors. I don't
carry ballances. makes you just want to close all you credit accounts,
but you cant because without credit your screwed.

Its simple...we access the risks you bring to the company. If you're
not paying your mortgage regularly or missed a car payment, you are an
increased risk to the company to put it simply. We see it like, if you
missed a payment with the mortgage, theres a good chance you may miss
one with us... We cannot say it over the phone because its not the
"nice way" to put it. We also don't see what wasn't paid on time, or
in full or whatever. The only thing we are provided with is a list of
reasons why...so don't go asking for dates and amounts. We only tell
you what we are presented with. Some Big wig in the company makes the
decision and the CS reps get cursed daily for it. That is just the way
it is.

I know how most of you feel as I am in the same boat. I had a credit
line of 25k and for 3 years never had a late payment and always paid
full amount each month. 2 months ago, they lowered my credit from
25,000 to a lowsy 500 citing that the 50% line i was carrying on one
of my chase credit cards was creating a bad income to debt ratio. I
was shocked! come to find out, they had incorrectly come up with an
income amount for me with out calling me to confirm if I even made
that much or not. Unbelievable treatment of great and loyal
customers! For a company that has just recently come up to semi-par
with companies like Visa and Mastercard, shows us all once again why
it will go down the toilet as great customer walk out! i have
switched to Discover now and am very happy with customer service and
integrity. Good Luck Amex as you really are screwing yourself, if it
hasnt been done already!

Every account has a statistical value based on usage. This is complex
and will impact credit limit decrease and increase. Those accounts
paid in full or rarely used are of no use to a credit card
company--virtually no income and added cost to maintain an open and
unused account. A second factor is risk quotient. How likely is the
customer to become a chargeoff--late payments and high balances,
finance charges equal to minimum payment due?

American Express has dropped my two credit card limits by over 90%
each. Each was dropped to the balance owed. I, like others, have paid
my bill in full and have never been late. My evaluation is simple:
American Express has mismanaged its business practices and although I
have managed mine--I bear the consequences. I will not be using
American Express until I am certain American Express will remain in
business. Recently American Express laid off 10,000 employees and
there was very little difference in the price of the stock. Good old
AMEX is in deep doodoo.

Discover has my business. Better rewards, no annual fees, excellent
customer service, a better run company all around.

Some of these replies dealing with high (even 50%) balances are
baloney. I own two AMEX cards. A "clear card" with a $5000 limit and
a $1900 balance due. They didn't touch this card.

Just yesterday, however, they lowered the limit on my "blue card". But
get this...this card hasn't had a balance due in over two years!!
They dropped the limit from $5000 to $1000. I will be canceling the
card today. I think that with the economy spiraling downward, that
consumers have just begun to see the effects (like these).

There could be mny reasons for the reduction in your credit line and
some that you may not be aware of. Amex does NOT like balances carred
for a long period of time. They call them charge cards but get
nervous if a balance remains on the card for several months. If this
card is at 50% and you are heavily utilizing other cards as well, Amex
will get antsy. If this is the onl card yu have and the balance seems
t be stuck wihtout significant py down, Amex will get antsy. Amex gets
antsy alot. Even openiung cards with other creditors makes them
nervous.

One late payment will cause a creditor to freakout. If you are not
paying smeone else, they may be next on the block so they reduce your
access to their money. Come on over to www.myfico.com an get a lot of
answers to your credit questions.

I'm sorry this has happened to you. AMEX has been in the news lately
for exercising their right to lower credit lines. It's nothing new,
it's happening to a LOT of people.

I pay the bills at work. My boss has 50k in amex lines. One line was
reduced by 50%. The next week he was called and asked to accept
Simply Cash. Go figure. Their explanation of the cld was very
simple: he wasn't using enough of his line. Huh?

Jim Cramer and Suze Orman have been discussing this lately. Amex is
on a roll with cld.

Amex has the right to reduce the limit by how ever much it feels as
it's in the agreemement. Most of the time it's going to reduce to
right above the current balance on the account. There is definitely
something showing on your account negatively whether it be credit
bureau info or pay history.

Attorney...

If you play with the snakes, you are going to get bit

I work in the collection industry, I know that because of the economy
and the credit crisis going on right now, lenders and cc co's are
scared big time. Go to annualcreditreport.com its the only true FREE
credit report. You are entitled to one per year. I see alot of people
who have stuff in collections and dont know it. maybe for some reason
you became a credit risk unbenownst to you. see what you find and if
their are anything other than 1's (pays ontime ) recently thats why.
Even a 2 (15 to 44 days late) will screw u up right now.Good Luck.

You must be doing something wrong. I have never paid any bill late,
and I have always paid my CC balance off on time. My limit has never
done anything but go up.

to pay it down and so you are more of a risk.
Just a thought.