Credit card limit query- affect on credit report?

Katye_2

Just wanted some advice, I have a couple of credit cards that keep increasing the limits on my card, I use them for emergencies say a couple have £200 on them , but the limit is 2000-£3,000 ?- I don't need that and would worry if I did.

I also have a next account and the credit limit has dropped each month - no missed payments and well over the min payment so I phoned out of interest, ( its a pretty new account - (granted)

One factor they say impacts a search is the credit card limits & searches
I havn't had any for six months and all green lights on my report.
So my question is....

Would it be better to ask that the CC companies to reduce the limit at my request would that be better on my credit report?

JustinCredibleGillespie

Yes most certainly Katye. They can see how much credit you have available to spend. Reduce your balance down to £1000 in each and leave it 6 months

Best of luck

Katye_2

Thank you Justin, sorry to sound dumb what do you mean leave it 6 months ? applying for any other credit?

just edited to say if on my report it shows a decrease of credit limit, would that not appear to other companies in the future that I'm not worthy of a higher limit even though it was me that requested the drop in the limit?

Ben8282

It would not be a good idea to reduce the credit limits as firstly they are not very high anyway and secondly it would not be obvious that you and not the credit card company had reduced them.

Yes, it may well appear to other companies in the future that you are not worthy of a higher limit

But then we come back to the frequestly asked question WHY? You say that you don't need these credit limits and would worry if you did, so what do you want to make your credit report look better for exactly? To obtain what?

As to your next account, I'm sorry but I have never heard of an account where the holders credit limit is reduced every month!

notts_phil

Next credit limits are like yo yos. I had one a few years ago changed every month for 3 years.

Ben8282

notts_phil wrote: »

Next credit limits are like yo yos. I had one a few years ago changed every month for 3 years.

So there is nothing for the OP to worry about then? Must be a lot of trouble for Next though; reviewing customers accounts and amending the credit limit each month. I wonder why they bother?

Katye_2

Ben8282 wrote: »

It would not be a good idea to reduce the credit limits as firstly they are not very high anyway and secondly it would not be obvious that you and not the credit card company had reduced them.

Yes, it may well appear to other companies in the future that you are not worthy of a higher limit

But then we come back to the frequestly asked question WHY? You say that you don't need these credit limits and would worry if you did, so what do you want to make your credit report look better for exactly? To obtain what?

As to your next account, I'm sorry but I have never heard of an account where the holders credit limit is reduced every month!

Hi thanks for your thoughts, I can assure you Next are strange! when it was opened the credit was £600 next month, it was £300, then £150 , now its £129, what a weird amount.. and I have spent £50 thats owing as of now all paid on time and over the minimum...

So I rang them today when I noticed this drop and said "my credit rating is good so why do you keep dropping this limit?" and they came out with this story how all accounts are monitored monthly with reference agencies? and sometimes high credit limits on cards even though not used are the reason they drop theirs, as do other companies?

Thats why I came on here to see what others thought, then had two posters one who told me to reduce the limit on the cards, another who said don't.

Thanks
Kate

Ben8282

Katye wrote: »

Hi thanks for your thoughts, I can assure you Next are strange! when it was opened the credit was £600 next month, it was £300, then £150 , now its £129, what a weird amount.. and I have spent £50 thats owing as of now all paid on time and over the minimum...

So I rang them today when I noticed this drop and said "my credit rating is good so why do you keep dropping this limit?" and they came out with this story how all accounts are monitored monthly with reference agencies? and sometimes high credit limits on cards even though not used are the reason they drop theirs, as do other companies?

Thats why I came on here to see what others thought, then had two posters one who told me to reduce the limit on the cards, another who said don't.

Thanks,

Kate

This is all very strange. Next appear to be behaving very oddly and I wouldn't take much notice of them. I have held credit cards since they first came out (yes, I am that old) and honestly have never seen a credit limit change every month! Imagine how many customers Next have. Does it really make sense to you that Next do a credit check every single month on each of these customers and change every credit limit every month. Imagine the cost, staff time etc.

Your credit limits are not high. If the credit limits were 20,000 or 30,000 I may agree that somebody may think you have too much unused credit, but not for these small limits that you have. I think the origin of the idea of having too much unused credit comes about as a result of people obtaining very large credit limits, possibly as a result of applying for 0% balance transfer cards and transferring large balances. As these individuals maintain excellent credit records, when the 0% offer is up they are able to apply for a new card. The new lender matches the credit limit so the balance is transferred. If this goes on and on, the result is that an individual could end up with lots of unused credit cards with really huge credit limits. Remember that you have to balance this advice with often conflicting advice not to be using too much of the credit available to you. If you had two credit cards with £1000 credit limits and £900 balances you would be in a worse position than if you had two credit cards with £3000 credit limits and £900 balances. In the first case you would be seen to be struggling but in the second you would be seen not to be in difficulty as you had a reasonable amount of credit available to you.

Katye_2

Ben8282 wrote: »

This is all very strange. Next appear to be behaving very oddly and I wouldn't take much notice of them. I have held credit cards since they first came out (yes, I am that old) and honestly have never seen a credit limit change every month! Imagine how many customers Next have. Does it really make sense to you that Next do a credit check every single month on each of these customers and change every credit limit every month. Imagine the cost, staff time etc.

Your credit limits are not high. If the credit limits were 20,000 or 30,000 I may agree that somebody may think you have too much unused credit, but not for these small limits that you have.

Thanks Ben I agree it was weird, but I guess I am paranoid about my finances and paying everything on time, so was shocked to see the limit dropping every month when as far as I was aware I am good for credit, I know its only a catalogue but this woman tried to say others work the way they do... god I hope not!!:eek:

Ben8282

Katye wrote: »

Thanks Ben I agree it was weird, but I guess I am paranoid about my finances and paying everything on time, so was shocked to see the limit dropping every month when as far as I was aware I am good for credit, I know its only a catalogue but this woman tried to say others work the way they do... god I hope not!!:eek:

I might be wrong here but I was just wondering if, as Next is a catalogue, they work differently and their credit limit may be in some way related to the value of the order placed and may be automatically decreasing as the order is repaid? Like a loan rather than a credit card. Just a thought.

chanz4

my mrs has a next account £1000, never uses and has over £6000 available on cc they never effect her for some strange reason