Lowering credit limits with pending transactions

Moneymash

Has anyone else experienced this... I had a CC and I received a letter in between statements saying that my credit limit was lowered. However, I had pending transactions so that meant that when they were taken from my cc account I was over the new lowered limit.

I know CC company's review accounts and can lower limits when they want just wanted to know if this was common?

YorkshireBoy

You don't say who your provider is (why not?), but here's what the Halifax T&Cs say...


"If we decrease your credit limit we will let you know before the change takes effect."


Maybe your provider is concerned you'd quickly run up more debt if they served notice? Is your account generally run well? Would you say you were in difficulty with debt generally, bearing in mind the provider will probably be receiving a monthly feed (including CII data) from the CRAs?

Moneymash

At the time I was using my card, and paying the minimum. I wasn't given anything but a few weeks notice as the letter was between statements.

When I got my next statement the limit had been lowered and with the now completed transactions I was over the limit and incurring charges. The CC company was Barclays although due to financial difficulties I experienced later they lowered my APR by 10%.

YorkshireBoy

Moneymash wrote: »

The CC company was Barclays

just wanted to know if this was common?

Very! Search the board and you'll find many reports of this with Barclaycard.

Moneymash

YorkshireBoy wrote: »

Very! Search the board and you'll find many reports of this with Barclaycard.

So if this has happened to others have they gone on to get their APR reduced, although this usually means once the debt is paid off the card is closed.

chattychappy

Moneymash wrote: »

Has anyone else experienced this... I had a CC and I received a letter in between statements saying that my credit limit was lowered. However, I had pending transactions so that meant that when they were taken from my cc account I was over the new lowered limit.

They are probably committed to those merchants to let those transactions clear. If they put you over a new limit, then they shouldn't charge you/report you. If they did you'd have good grounds to argue.

If you only pay minimums, it is a warning to CCs that you might be in distress. Always worth paying at least £1 more just to avoid the "minimum payment" marker on your account.

Moneymash

That's the thing, knowing what my current balance was and that there were pending transactions, they lowered my limit to be under that amount and then charged me. However, as I said in an earlier post they eventually lowered my APR, so swings and roundabouts as they say.