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 Credit limit decrease
Posted Wed August 1, 2007 3:04 am, by Howard H. written to Discover Card
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I was recently making a purchase with my card and it was declined. When I called to find out what the problem was I was informed that my credit limit had been reduced from $3000 to $1000. I was informed that it was due to the fact I had recently acquired several new revolving accounts. I was told to qualify for the mortgage we were seeking that I needed to have more revolving credit. Now by reducing my credit limit it looks like I have maxed out my credit card and destroying my FICO score and wiping out the work we have done to qualify for our home loan. I received my statement on Monday and the credit limit indicated $3000. I have yet to receive anything in writing as to why the credit limit was reduced. We were so embarrassed when this happened. All we are asking is that the credit limit be restored back to $3000. We were so excited to get this Discover card and are proud to be apart of the Discover family.
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by Marisa Toccin Posted Fri August 10, 2007 @ 4:11 PM
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Howard,
I am a national television news producer working on a story about
credit companies decreasing credit limits. I would love to speak with
you about your situation. What is the best way to get in touch? I can
be reached at mtoccin@newspronet.com.
Thanks!
Marisa
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by Jeffrey Posted Wed August 1, 2007 @ 9:43 AM
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While it's lousy that you weren't notified, what they did is not that
unusual.
Everyone has a certain amount of credit. For you, lets say it's
$5,000.
You have a Discover Card. It's has a $3000 limit. That leaves you
with $2000.
Someone else extends you credit for $4000. They do this, perhaps
knowing that you already have $3000. However, they're willing to talk
a risk on you being someone that's overextended.
Discover, learning this, says "we're not willing to take that risk"
and they adjust to bring you back to the $5000. They lower their
credit limit to $1000.
While this is over simplified, I hope it makes sense to you.
With the credit and loan industry starting to collapse, expect to see
more stringency. Not less. Expect that you'll be kept to your max
and expect to see even more severe penalties for going over a limit or
not paying.
Sorry that Discover didn't tell you. But what you should have now are
several revolving accounts which hopefully add up to enough that
you'll qualify for your mortgage.
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Discover
by Alan Wed August 1, 2007 @ 6:56 PM
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