Credit Limit reduced but no missed payments

bubblesqueak

I've just had a letter from AMEX saying they've reduced my credit limit (to just about what the balance is) after reviewing my acct. Admittedly I am almost up to my limit and have only been paying off the minimum amt each month (Well always about 3 or 4 quid more but negilible.) But have got some of these fixed bonds maturing this year that will serioulsy reduce it to >£1000. The reason its high is becuase, knowing about the bonds, I wasn't bothered about spending on it, I've been doing the house up and wanted it done before xmas. I haven't spoken to them yet but am now worried that if I throw my matured bonds at it, they'll reduce it even more and I'll be left with no credit. I've never missed a payment or made a late payment. Can anybody comment on this???

Merlinexcalibur

As this happened to me a while ago I can only pass on what I was told might be the cause. Simply, if you have any other borrowing. Periodically, as you will probably already know, CC companies carry out reviews on individual accounts.

But ...

Admittedly I am almost up to my limit and have only been paying off the minimum amt each month (Well always about 3 or 4 quid more but negilible.)

That is probably the reason. As you aren't paying more than your minimum payment they may be thinking you might be a bad risk or a potential risk and, incorrectly, just assuming it's because you are having trouble with your finances. It's all black and white I am afraid.

bubblesqueak

Thanks. I don't have any other borrowings anywhere. I fell into difficulty a few years ago and wiped them all but, ironically, AMEX was the one card that I kept squeaky clean and never missed or was late on a payment. The only way they would have known about them is by doing credit checks on me which I didn't think they could do randomly and since releaving myself of debt haven't had any problems at all. (I've been quite chuffed really and was a bit deflated today after getting the letter.)

97trophy

bubblesqueak wrote: »

Can anybody comment on this???

Don't mean to sound rude.

Yes, Amex is suffering from bad debts. Their computer models have pin-pointed the way you use your amex account as a future possible bad debt. And they are reducing their risk.

Amex are currently very proactive on this and thousands of people are getting the same response from them.

This is the credit crunch coming home to you. Sorry there is nothing you can do.

bubblesqueak

Is there evidence that they willl continue to reduce my credit available as I reduce the outstanding balance?

cifpower

I think Amex are only following in the footsteps of other CC companies who lower limits to just above balances, in particular Barclaycard.