Does voluntarily reducing your credit limit affect your credit rating?

anon_ymous

Whormsley wrote: »

Will fraud affect your credit rating?

Depends really. If someone uses your card fraudulently and you don't suspect it for months then yes it can do.

If you keep on top of your accounts and report anything you suspect instantly, then no, it won't affect you.

After saying that, I suppose Ill probably keep my cc limit as it is then. Thanks for the help, and it's probably helped the OP as well

anon_ymous

Whormsley wrote: »

No worries.

One last thing. It's not as easy to get it back again once it's decreased. You might decrease it one week, then for some reason, desperately need it the next.

There's no guarantee at all that you can get it back.

I was under the impression that this sort of thing is best done after six months and that you should think of a figure about 6/7 times what you normally spend on average

callum9999

Whormsley wrote: »

Sorry but it CAN have a negative impact!

Firstly, a potential lender doesn't know who decreased the limit. Was it you? Or was it your CC lender because they thought you were a risk?

Plus, you're always covered for fraud on your card. No matter how much it is.

I don't really think any reputable lender will base their judgement of someone's risk on a perceived act by an unknown 3rd party which may or may not suggest they thought the person was a risk.

They will be well aware that the limit could have been decreased by the account holder, or that the creditor was just reducing unused credit it's liable for to balance it's books (which is known to happen).

Of course it CAN be negative, but it can also be positive as well - as others have mentioned, reducing the limits available to the person. You yourself said your company would never lend £15k to someone with a £15k income - which surely includes debts they hold elsewhere.