MBNA Lowered Credit limit Without warning !!!

Mrsbowbow

I know they can do what they want, but Yesterday I had a Credit limit of £11,600 as I've been with them for years and always paid on time. I have £1,488 left to pay on the my card and today they have lowered my Credit Limit to £1,800 with no notice or no warning.
I know they can do this at anytime but you would of thought they would give you some warning ! I was going to go this week and put a deposit down on a holiday !!Not now :mad:
As it's a massive difference between £11,600 and £1,800 nothing has change in circumstances either !!!!!!!!!!!!!!!!

[Deleted User]

If they gave warning, a lot of people would run out and spend up the existing limit.

I'm guessing you haven't made much use of your limit in the past which is why they've reduced you.

KingElvis

Yep, less exposure to them and also they can give that capital to someone they'll make a profit from.

If you've been with them years, maybe time to shop around for a new card?

Dave_the_Ginger_Cat

Depends on the reason why they've reduced it, but if you'd like some of it back to use for your deposit as you suggest, they may be willing to take it up to cover this.

fozmcfc

Could be a good thing for you, it will reduce the amount of credit available to you and you may be able to get another card.

If you have a very good/excellent credit status, why pay interest on the card, get a card and transfer the balance away and pay 0% on the balance over a certain amount of time.

Or get a card which offers 0% on purchases for a length of time from opening, such as the M&S card, which is offerring 0% on purchases for 15 months from opening the account.

The reason why they won't tell you, is as others have said, you could have just gone out and spent on it and they wouldn't have been able to reduced the limit to below what you owed.

MoneyWasting_Expert

Barclaycard reduced my limit, but that was for a different reason. Was always over credit (1500) and then 2 months ago I made a payment off around 300 brought it back in credit for the first time in a long while (more occupied with serious collections) and I thought great my account looks a bit better the next day checked online again and my credit was reduced to 1350, about a week later I got a letter from Barclaycard acknowledging want they had done and it was to protect me later. I kinda appreicate that they took that step because my account really deserves to have the limit reduced. Balance is now around 800 and the bill will be generated tonight. This is my next bill since the reduction in cl and interested too see if they will drop it further.

To the op I presume, your limit was rarely used, in which case I think there is a good chance that they raise it again for your holiday deposit. Likes for me my limit lies in the hands of reviewers over time and how I handle my account.

One other thing I notice they put it on the credit file as well if the limit has been reduced or increased, what implications does this have?

oki25

Firstly, it doesn't explain on your file why the limit has been reduced, so can be detrimental in some circumstances, be careful.

There are a few reasons why they may reduce it,

1. a recent application for a card run by Bank of America (mbna, virgin, aa, bt, bmi, Play ect......)
2. a tip off from another provider
3. obvious changes in circumstance, just because you think nothings changed does't mean all is well, check you credit file


Wishing you well xxxxx

John_Fletcher

oki25 wrote: »

Firstly, it doesn't explain on your file why the limit has been reduced, so can be detrimental in some circumstances, be careful.

There are a few reasons why they may reduce it,

1. a recent application for a card run by Bank of America (mbna, virgin, aa, bt, bmi, Play ect......)
2. a tip off from another provider
3. obvious changes in circumstance, just because you think nothings changed does't mean all is well, check you credit file


Wishing you well xxxxx

I had 2 x MBNA accounts (one with a 10500 credit limit) applied for a Virgin card (0% Balance transfer) a week later both MBNA credit limits reduced to just above the low balances. :mad:

izools

MoneyWasting_Expert wrote: »

One other thing I notice they put it on the credit file as well if the limit has been reduced or increased, what implications does this have?

The fact alone that the limit has been reduced has no detrimental effect.

All that does have an effect is the new limit and how you stand with that - if it shows much less exposure and a low balance to limit ratio, that's good - however if the limit decrease leaves you with a balance very close to the limit it will have a detrimental effect as it suggests debt stress.

nickmack

oki25 wrote: »

There are a few reasons why they may reduce it,

If you're with Sainsburys, add to those possible reasons:
You're on a low Life of Balance rate and because the payment hierachy has now changed, they can't make any money out of you, so they want to get rid of you as a customer by reducing your credit limit every month.