Can a bank do a credit check whenever they like?

patashoo

I've been with the bank for a number of years. A few months ago they increased my credit limit on my credit card. Now they have sent me a letter and reduced my limit after doing a credit check on me. I pay minimum amount monthly. Can they look at my score whenever they like? Surely this will show that someone has been looking which won't reflect well on me. Can anyone help please?

Anthorn

I think if you look at your credit history you will find that a new credit search has not been recorded and therefore your credit history is not impacted. There is no need for a new credit search because they already have your credit history and can update it. Some companies however do perform new credit searches such as MBNA when applying for a limit increase but they must have your agreement to do it.

antrobus

patashoo wrote: »

I've been with the bank for a number of years. A few months ago they increased my credit limit on my credit card. Now they have sent me a letter and reduced my limit after doing a credit check on me. I pay minimum amount monthly. Can they look at my score whenever they like? Surely this will show that someone has been looking which won't reflect well on me. Can anyone help please?

What does it say on your CC terms and conditions?

If I was running a CC business, I'd have a term that said something like 'we may periodically review your credit limit, and you hereby authorise us to perform a credit check as part of that review'.

20aday

In the past I had a Halifax credit card. Limit was £1,000 from memory.

Had the account a couple of months and opened a Very credit account; the Halifax then wrote to me reducing my limit based on external data from the credit reference agencies.

If you are only ever making the minimum monthly payment I wouldn't be surprised if they've been "spooked" and have reduced it to avoid any (potential) trouble down the line.

Have you checked Experian/Equifax/Callcredit to check the data reported on your file(s) is accurate?

GingerBob_3

20aday wrote: »

In the past I had a Halifax credit card. Limit was £1,000 from memory.

Had the account a couple of months and opened a Very credit account; the Halifax then wrote to me reducing my limit based on external data from the credit reference agencies.

If you are only ever making the minimum monthly payment I wouldn't be surprised if they've been "spooked" and have reduced it to avoid any (potential) trouble down the line.

Have you checked Experian/Equifax/Callcredit to check the data reported on your file(s) is accurate?

Or more to the point - who is snooping on you.

27col

Whatever they did, they did not look at your credit score.
They may have looked at your credit record. Which is an entirely different thing from your credit score, which is something that only you can see. Only ever paying the minimum is not viewed as a good thing. It tends to indicate a certain amount of financial stress.

PaulW922

They will be entitled to undertake periodic reviews against your credit profile as that will almost certainly be in your contract. Those checks will not show up as full credit searches in that other potential lenders will not know about them.

gunsandbanjos

Banks get a monthly update from the CRA.

20aday

When I enquired about a loan with Lloyds last year I was told they update their customers' credit "worthiness" around the middle of the month.

Seeing as Halifax are part of the same Banking Group I'd imagine they follow a similar process.

Doctor_Duke

Lenders receive monthly updates from CRAs called "insight" information. They can use this information to risk profile and can reduce limits as a result of new information. When you apply for credit and agree to the T&Cs you will normally find that you have given the lender permission to do this.

GingerBob_3

Doctor_Duke wrote: »

Lenders receive monthly updates from CRAs called "insight" information. They can use this information to risk profile and can reduce limits as a result of new information. When you apply for credit and agree to the T&Cs you will normally find that you have given the lender permission to do this.

But, you don't need to have given permission for a whole range of organisations to place you under financial surveillance via CRA data feeds and other reporting. Any organisation with "reasonable cause" (the term is purposely ill-defined by the ICO and the financial sector), and many others that don't have reasonable cause (e.g. local government) can investigate you.