Barclaycard have damaged my credit rating are they liable?

philip99

Hi there,

I like many others have had my Barclaycard credit limit slashed. I always pay the card off in full and before this had a experian credit rating of 995/1000.

However Barclaycard slashed my credit limits without warning me to just 5% above the card balances. This now means that on my credit report I am essentially 'maxed out' at 95% of my usable credit. If they had given me warning I could have cleared the card etc, or brought it down to the 30% optimum for credit agencies. Due to this my credit rating is now classed as 'poor'.

I have gone from someone with a credit report of 995/1000 who paid his card off in full every month, so someone who now has no credit and a 'poor' rating. And I am still completely consistent!

Therefore Barclaycard are responsible damaging my credit rating, not me.

In the future surely it will be law that they have to give you some notice that they intent to change your credit limit?

I am fuming with Barclaycard, been with them 16 years, and now despise them.

[Deleted User]

Hi Phillip,

Sorry to hear about this.

Without wanting to probe, I think there's something else that's at play here - so would be worth you doing some more checks.

I very much doubt that Barclaycard reducing your overdraft down to balance + 5% would reduce your credit rating from 'excellent' to 'poor'. Unless, of course, the reason they reduced it is because bad behaviour on your account (and it's the bad behaviour that's damaging your rating, not the balance).

Firstly, Barclaycard will have written to you to give you notice they were going to do this.

Secondly, the credit reference agencies receive information from Barclaycard once a month, so it's quite likely that if you had cleared the balance it would be reflected on your credit report anyway (e.g. once they'd written to you, clear the balance before they update Experian/Equifax etc).

I have had periods of using 95% of my available credit - and my credit rating was excellent at the time.

If you only have one credit card (which I'm assuming is true, if the balance on one card can comprise 95% of your total available credit), then I'm really not convinced that this is the reason why your credit rating is now 'poor'. It's just not how credit ratings work, especially if you usually pay your card off in full each month.

So, my advice:

Get a full copy of your credit report
Post a full statement-of-affairs here
Be honest with us: have you missed any payments, defaulted, CCJs?
Have you applied for lots of credit recently?

There's something else causing your problem, not Barclaycard.

Paul_Herring

philip99 wrote: »

I like many others have had my Barclaycard credit limit slashed. I always pay the card off in full and before this had a experian credit rating of 995/1000.

Lets stop right there.

Those numbers that Experian sell to you are nothing but a money maker for Experian, and bear little to no resemblance to reality. See http://forums.moneysavingexpert.com/showthread.html?p=18953927#post18953927

[Deleted User]

Paul_Herring wrote: »

Lets stop right there.

Those numbers that Experian sell to you are nothing but a money maker for Experian, and bear little to no resemblance to reality. See http://forums.moneysavingexpert.com/showthread.html?p=18953927#post18953927

Hi Paul,

I don't want to sound rude, but you keep posting this across a variety of threads and whilst I can see what you're trying to say, the truth is that credit ratings DO have a reasonable resemblance to reality.

I agree that it's 'just a number' - but the point is surely that the perspective Experian has is no different from that of a bank looking at your application. The number is just a number, but the point is that it's a perspective on your credit report that is pretty likely to mimic the view taken by a lender.

Different lenders have different criteria, but you only have to look at the debate and array of questions from posters on here asking 'what does this mean?' etc, to realise there's huge confusion. A credit rating is just a number, but at least it's one number that says pretty clearly whether, on the whole, your report is good, bad or ugly. And it's pretty accurate.

When my credit report looks good, I get accepted for credit. When it's poor, I get rejected. And throughout, my credit score is a good reflection of whether my report's good or bad.

Having a single score that people look to, in order to try to improve it, is surely only a good thing. It's an easily quantifiable measure of how attractive your credit report looks.

As for Experian/Equifax etc 'fleecing people', well...hardly. It costs £5.95 for your report and you don't need to check it if you don't want to. You could just have a look at it 2 or 3 times a year and it'll be a good enough indication.

What I'm saying is, yes it's an arbitrary number, but it's calculated from the perspective of an organisation looking at your report the way that a bank would (subject to a few variations). If your score is 111 then you're not going to get credit. If your score is 999 then you're a good candidate.

NickX

Deleted_User wrote: »

If your score is 111 then you're not going to get credit. If your score is 999 then you're a good candidate.

I don't think you are right actually.

The criteria from different lenders varies extensively and a single score cannot indicate your level of credit worthiness across all lenders.

People with 999 scores are regularly declined credit, those with low scores are often granted credit to their surprise.

These credit scores are simply an excuse for the CRAs to extract more money from people. It really gets to me when people post on here that they have paid for a score - this is a waste of money and they have been fleeced. I never ever pay for a score.

Remember the CRAs are private companies and their aim is to make as much money as possible one way or another.

Paul_Herring

Deleted_User wrote:

The number is just a number, but the point is that it's a perspective on your credit report that is pretty likely to mimic the view taken by a lender.

(emphasis mine) This is where I strenuously disagree. Experian are in the business of selling credit reports to punters (I'm ignoring the statutory ones here) and data to businesses. A nice sideline is by selling a credit score which, given the empirical evidence, is highly unlikely to match what a real credit business is likely to give you.

Witness all the threads saying "I've got a score of 999/1000 from Experian, yet I was still turned down - why?"

If the score provided by Experian was at all accurate, then the application should have been accepted.

Having a single score that people look to, in order to try to improve it, is surely only a good thing. It's an easily quantifiable measure of how attractive your credit report looks.

Indeed, however when that score is 999 (per Experian), and you're still getting refused credit, what are you supposed to "improve."

As for Experian/Equifax etc 'fleecing people', well...hardly. It costs £5.95 for your report

Um - no it doesn't. If you're paying for it at all, it costs £2. If you're paying more than that, you're being fleeced.

ILW

philip99 wrote: »

Hi there,

However Barclaycard slashed my credit limits without warning me to just 5% above the card balances. This now means that on my credit report I am essentially 'maxed out' at 95% of my usable credit. If they had given me warning I could have cleared the card etc, or brought it down to the 30% optimum for credit agencies. Due to this my credit rating is now classed as 'poor'.

.

They have a perfect right to reduce credit limits at any time. The reason they do not always inform in advance is that some numptys will max the card before the deadline.
You say if you had known they were going to reduce the limit you would have cleared the card, why not just do that now and your credit score will be accordingly adjusted?

[Deleted User]

My point was more: "If Experian give you a credit score of 000", chances are a bank won't be queueing up to give you credit.

If Experian give you a credit score of 999 and the banks refuse you credit, then at least you know it wasn't because of your credit behaviour, but probably because you're not profitable to the bank.

Paul_Herring

Deleted_User wrote: »

If Experian give you a credit score of 999 and the banks refuse you credit, then at least you know it wasn't because of your credit behaviour, but probably because you're not profitable to the bank.

But your credit score is supposed to be "how likely you're going to get credit," taking into account anything a real credit business is likely to take into account.

So, for example, shouldn't "how profitable you're likely to be" if it's a part of (say) Amex's credit scoring procedure, be also part of Experian's?

ILW

Deleted_User wrote: »

My point was more: "If Experian give you a credit score of 000", chances are a bank won't be queueing up to give you credit.

If Experian give you a credit score of 999 and the banks refuse you credit, then at least you know it wasn't because of your credit behaviour, but probably because you're not profitable to the bank.

Experian do not "give you a credit score" it is just a guestimate made on the information they hold on you, I believe it does not even take into account income. This score is not passed to lenders who just use the raw data and what you put on an application to make their decisions. Therefore Experians score has no influence on whether you are approved or not.

Paul_Herring

ILW wrote: »

Experian do not "give you a credit score"

Perhaps someone should tell Experian that then:

http://www.experian.co.uk/ (Yup - the homepage no less):

Experian Credit Score

Lenders calculate a credit score when you apply for a credit card, loan or mortgage so the higher your score, the better your chance of getting the best deal.

With the bold bit leading to http://www.creditexpert.co.uk/:

Know your Score

Higher scores usually mean lower interest rates on new credit applications, which could save you money.

Looks like they're selling credit scores to me. There's even a conspicuous lack of footnotes to explain what the score is/isn't.

it is just a guestimate made on the information they hold on you, I believe it does not even take into account income. This score is not passed to lenders who just use the raw data and what you put on an application to make their decisions.

Then it's a bad guestimate, and they should not be giving them, let alone selling them as if they are accurate, and reflect what real businesses use.

Therefore Experians score has no influence on whether you are approved or not.

Does that mean it's useless then?