Reduced limit - why?

robynlouise

Got a 0% card with Halifax purely to transfer balance from Barclaycard and pay it off. £2500 limit. It's down to £2200 and they've reduced limit to £2300! Is it because I don't use it? The letter mentions responsible lending but I've never missed a payment and have had no change in circumstances that would affect my affordability.

elsien

Quite possible. I had my credit card limit reduced from about £2000 to £250 because I'd stopped using it and there was a zero balance, keeping it just for back up. They did explain that by letter though, when the credit balance was reduced. Is it on one of the statements somewhere.

frank777

Don't forget Balance Transfers 95% of credit limit = £2,185 £2,200 balance is over your LIMIT and subject to over Limit Fee/credit report marker?

Just be careful, they might trash your credit rating as well

Have they given notice of reduction - date - to give you a chance to clear overspend before reduction kicks in?

''The letter mentions responsible lending'' :sad:

john1002

The Lloyds group of companies are known for this risk management and reducing limits, they did it with me and one card I only had 3 months, you say no changes but in my case I opened a lot of new current accounts and as a result a number of searches in turn the monthly feeds they get from credit agencies spooked them and they reduced limits to just below BT.

7 months later I have increased the limits back to there pre change amounts.

Annoying but just keep paying off and try to increase back in 6/7 months.

John

MABLE

john1002 wrote: »

The Lloyds group of companies are known for this risk management and reducing limits, they did it with me and one card I only had 3 months, you say no changes but in my case I opened a lot of new current accounts and as a result a number of searches in turn the monthly feeds they get from credit agencies spooked them and they reduced limits to just below BT.

7 months later I have increased the limits back to there pre change amounts.

Annoying but just keep paying off and try to increase back in 6/7 months.

John

I thought Lloyds would pick on me because I have held their Avios free fee card for a number of years with a £15,000 limit and only use half of that for stoozing. Also have a £10,000 overdraft facility with my checking account and only use a fraction of it for inter day transfers but again they just leave me alone.

jamesd

robynlouise wrote: »

Got a 0% card with Halifax purely to transfer balance from Barclaycard and pay it off. £2500 limit. It's down to £2200 and they've reduced limit to £2300! Is it because I don't use it?

By way of contrast, they increased my limit by about £1,000 on a nine month old card that i initially did a BT on but have spent a little on regularly to maintain the 0% balance level when minimum payments are made., keeping the card also quite close to limit fully used. They also just offered me a 0% for 15 month 3% fee balance transfer deal on the card that I'll use to use the extra limit I now have available. I didn't ask for the increase, they just did it and offered me the opportunity to decline or take it a bit sooner.

Yes, it'll be due to you not making regular use of the card. Firms have to keep some capital to cover the amount of lending they do, a different amount for each type of lending, so there is a cost basis for firms that may reduce limits.