Happening all over. One of our main business cards was cut by 85% out of the blue last month. Come June, that bank was out of business altogether.
This is heading into PoFo territory, so feel free to move it, mods. What frosts me about this is that for all the talk of "credit card reform," the package approved in May is only designed to help those who struggle to pay their credit card bills. Meanwhile, those of us who have had no problem have their purchasing power crippled. It's symptomatic of the thoroughly screwed economic triage happening in response to the recession. The insolvent and irresponsible get a scuba tank, while the rest of us tread water. It amazes that the same people who scoff at "trickle down" economics are convinced "trickle up" economics will work any better. Hello ... gravity!!!
To go with your point, I've got a friend who is having trouble paying their mortgage but haven't missed a payment yet. They went to refinance and the lender said no. Afterwards they the lender told them if they had missed a few payments it would be a different story and they wouldn't have any trouble refinancing.
it has a lot to do with credit scores too. mine is 807 and we just had our discover card knocked down to 1.9%. our sears card has gone the other way though. we were getting 9%, now its up to 16%. we just paid it off and gave em back their card, in pieces ofcourse.
Getting closer and closer to a Union mentality out there: Do less and less and demand more and more. Its impossible to fail when there is ZERO emphasis or benefit associated with striving to succeed.
Yep, if you're the type of customer who pays off his balance every time you get a bill, they will cut your limit, and most likely raise your interest rate. They don't make any money off of a guy like that. They make money on the people who carry huge balances -because those people pay the exorbitant amounts of interest credit card companies lust after. I don't even use my credit card anymore, and I only keep it in case of financial emergency. My limit has been cut by more than half and they raised my interest rate to over 25%. That's the "thanks" they give to those of us who are responsible.
That's all well and good, but our economy is so credit-card driven, it's hard to eschew its use entirely.
My credit card company raised my intrest and added monthly fees, so I paid it off and cut the card up. I will survive with out a card.
Thats true for credit limit...but if you are the type to pay off in full..then its simply extending $$$ for free....having less available for free may stink, but if you are the type to pay off in full and never incur finance chargers or late fees...simply get a 2nd card in this time of reduced credit limits. 1) it wont last forever, and eventually your credit limits will increase...and you can cancel the 2nd card 2) Presuming no single purchase exceeds 1 cards limit (although you could always spread over multiple cards) the 2nd card is not a bad approach to play by their rules and still float some free money your way. 3) If you are earning any interest in Checking w/Interest or Savings acct while you have placed charges on the cards and simply pay them off in full by the deadline once they arrive you still come out ahead 4) While the sound of .25% interest is scary...never having it applied makes it moot! I do think its dumb for CC companies to reduce credit limits, and know some folks are impacted by higher interest rates...but its like every other aspect of life....if you can play the game and spin it to your advantage, adjusting your strategy to beat them again as they adjust keeps you on your toes and still a winner in the short and long run. Its fun beating the man!
False. I've already read stories about how they were cutting people's balances BELOW their current balances. In some cases they even charged them an overage fee. Durrrrty.
That sucks Doc. This started last year. It happened to my boss and all his rich friends. Not to me though. I outsmarted them. I keep a very low credit score, and they won't give me a card....
