Credit card limit increase in DRO

alltaken

Hi all, I've mentioned in a previous thread about an unused credit card being allowed to be used in insolvency (insolvency service) confirmed it was okay.

The card provider has upped the limit to £500 as of end of June. Does the increase fall under disclosure of insolvency when applying for credit of £500 or more?

I'm confused on the position here, on one hand the card issuer has every right to withdraw the card because of insolvency, so far it has had months of use without issue, also factor in that the increase offered must have been based on statements and credit history (current commitment etc), so surely the whole insolvency would have been known at that check?

I don't want to fall foul of the credit rule when insolvent but don't want to alert the card issuer if I can legally help it, the card is already helping me gain a green mark each month.

Increasing an existing line of credit, is that the same as applying?

Thanks all.

mwarby

No it's different, the £500 rule is to protect unwitting lenders and suppliers from giving credit without knowing your insolvent

I'd be very surprised if the card company don't know(they'd normally check your credit file before deciding to increase your limit)

alltaken

I haven't informed the card issuer, could it become an issue? TheGardener mentions on my post in the BR board that the card issuer may not have checked and has gone by statements.

mwarby

Indeed they may not have checked(it's very difficult to tell). In any case you didn't apply and its not over £500. I would of course be careful that you can cope with the higher limit and don't run up new debt