NatWest Credit Card Trap

gigasmee

Hi,

I recently took out a NatWest Credit card with 23 month 0% interest on transfers and transferred balances to around 45% of the limit.

A few months later, they cut my limit by 50% which has directly affected my credit score, claiming a review of my circumstances, which frankly had not materially changed except to improve slightly.

Their behaviour is at odds with any other credit card (all others are well below their limit and reducing), and I think somehow it was not an impartial act.

During COVID they equally quickly granted a bounceback loan for my business account and refused to extend the terms, staying I had previously had an IVA on my personal account ( settled in 2017). I might add I didn't pursue a PPI claim against them because of the IVA.

I feel deliberately treated in an unfair way.

Twice they have accepted business from me to then change the situation.

Apart from rearrange everything away from them, what can I do?

MattMattMattUK

gigasmee said:

Hi,

I recently took out a NatWest Credit card with 23 month 0% interest on transfers and transferred balances to around 45% of the limit.

A few months later, they cut my limit by 50% which has directly affected my credit score, claiming a review of my circumstances, which frankly had not materially changed except to improve slightly.

A lot of lenders are reevaluating their appetite for risk, they reviewed your circumstances against their new model and chose to reduce their exposure. Your credit score is meaningless and made up, the fact that is has gone up or down is equally meaningless.

gigasmee said:

Their behaviour is at odds with any other credit card (all others are well below their limit and reducing), and I think somehow it was not an impartial act.

Their lending model may be different to the others, they may feel more exposed because it is a 0% rate so a lower priority for you to repay etc. It was not impartial, it was rational bases on their models.

gigasmee said:

During COVID they equally quickly granted a bounceback loan for my business account and refused to extend the terms, staying I had previously had an IVA on my personal account ( settled in 2017).

They were required to grant the BBL as per government requirements, where as the extension was a commercial decision and so someone with a recent history of an IVA would not be someone who they would want to lend to.

gigasmee said:

I might add I didn't pursue a PPI claim against them because of the IVA.

You can add it, bit it is entirely irrelevant. 

gigasmee said:

I feel deliberately treated in an unfair way.

Twice they have accepted business from me to then change the situation.

Apart from rearrange everything away from them, what can I do?

You have not been treated unfairly. The BBL it was you who tried to change things and the second a lender can reduce a credit card limit at any time.

You can like it or lump it, you have no right to a particular limit or even to a credit card.

flaneurs_lobster

Natwest would have considered your overall credit position not just any outstanding debts with themselves.

So your position with other cards and lenders is also relevant. 

Anecdotally, banks and other lenders do seem to be reducing credit limits on cards and overdrafts, especially where these are not (or only partially) used. It's an easy way of removing liability and exposure from their books.

born_again

gigasmee said:

Hi,

I recently took out a NatWest Credit card with 23 month 0% interest on transfers and transferred balances to around 45% of the limit.

A few months later, they cut my limit by 50% which has directly affected my credit score, claiming a review of my circumstances, which frankly had not materially changed except to improve slightly.

Their behaviour is at odds with any other credit card (all others are well below their limit and reducing), and I think somehow it was not an impartial act.

During COVID they equally quickly granted a bounceback loan for my business account and refused to extend the terms, staying I had previously had an IVA on my personal account ( settled in 2017). I might add I didn't pursue a PPI claim against them because of the IVA.

I feel deliberately treated in an unfair way.

Twice they have accepted business from me to then change the situation.

Apart from rearrange everything away from them, what can I do?

Which is a meaningless figure generated by CRA's & never seen by lenders.

Clearly they have found that your income to debt ratio is above the amount that they are happy to stand.
All lenders are free to amend their risk levels at any point.

If you are not happy then complain. But they would be within their rights to not change the decision. As it is based on a business risk decision.

gigasmee

flaneurs_lobster said:

Natwest would have considered your overall credit position not just any outstanding debts with themselves.

So your position with other cards and lenders is also relevant. 

Anecdotally, banks and other lenders do seem to be reducing credit limits on cards and overdrafts, especially where these are not (or only partially) used. It's an easy way of removing liability and exposure from their books.

Thanks for replying - it's a fair statement of fact.

I was taking my whole position into account, which has improved since they approved my credit limit.

Perhaps what I am saying is while they are within their rights, they have consciously accepted my.position with one hand while.rasseswing it with the other, all other things being equal.

gigasmee

born_again said:

gigasmee said:

Hi,

I recently took out a NatWest Credit card with 23 month 0% interest on transfers and transferred balances to around 45% of the limit.

A few months later, they cut my limit by 50% which has directly affected my credit score, claiming a review of my circumstances, which frankly had not materially changed except to improve slightly.

Their behaviour is at odds with any other credit card (all others are well below their limit and reducing), and I think somehow it was not an impartial act.

During COVID they equally quickly granted a bounceback loan for my business account and refused to extend the terms, staying I had previously had an IVA on my personal account ( settled in 2017). I might add I didn't pursue a PPI claim against them because of the IVA.

I feel deliberately treated in an unfair way.

Twice they have accepted business from me to then change the situation.

Apart from rearrange everything away from them, what can I do?

Which is a meaningless figure generated by CRA's & never seen by lenders.

Clearly they have found that your income to debt ratio is above the amount that they are happy to stand.
All lenders are free to amend their risk levels at any point.

If you are not happy then complain. But they would be within their rights to not change the decision. As it is based on a business risk decision.

My total debt to income has improved since they approved my original application and balance.

All I have done is move money around to accelerate my debt reduction (thought that was the point of zero % transfers), which has been working, so I would say it's their criteria that have changed.

I know they are within their rights to do what they want.

That doesn't mean we have to assume they are doing it impartially or in good faith.

gigasmee

MattMattMattUK said:

gigasmee said:

Hi,

I recently took out a NatWest Credit card with 23 month 0% interest on transfers and transferred balances to around 45% of the limit.

A few months later, they cut my limit by 50% which has directly affected my credit score, claiming a review of my circumstances, which frankly had not materially changed except to improve slightly.

A lot of lenders are reevaluating their appetite for risk, they reviewed your circumstances against their new model and chose to reduce their exposure. Your credit score is meaningless and made up, the fact that is has gone up or down is equally meaningless.

gigasmee said:

Their behaviour is at odds with any other credit card (all others are well below their limit and reducing), and I think somehow it was not an impartial act.

Their lending model may be different to the others, they may feel more exposed because it is a 0% rate so a lower priority for you to repay etc. It was not impartial, it was rational bases on their models.

gigasmee said:

During COVID they equally quickly granted a bounceback loan for my business account and refused to extend the terms, staying I had previously had an IVA on my personal account ( settled in 2017).

They were required to grant the BBL as per government requirements, where as the extension was a commercial decision and so someone with a recent history of an IVA would not be someone who they would want to lend to.

gigasmee said:

I might add I didn't pursue a PPI claim against them because of the IVA.

You can add it, bit it is entirely irrelevant. 

gigasmee said:

I feel deliberately treated in an unfair way.

Twice they have accepted business from me to then change the situation.

Apart from rearrange everything away from them, what can I do?

You have not been treated unfairly. The BBL it was you who tried to change things and the second a lender can reduce a credit card limit at any time.

You can like it or lump it, you have no right to a particular limit or even to a credit card.

I appreciate your clear and detailed response.

They needn't have approved the bounceback loan on the first place.

That would have been clearer.

No-one has a right to a credit card by your reckoning and actually I agree.

No-one has any right to any form of financial product actually.

So I think that statement, while accurate, frames your response as valuable but slightly antagonistic, which is fine. Let's not forget financial businesses don't have the right to exist either, and their model builds is the consumer into itself as a profit margin with risk accepted.

NatWest more than most have played that past the margins Fortnite own sake and failed.

gigasmee

gigasmee said:

Hi,

I recently took out a NatWest Credit card with 23 month 0% interest on transfers and transferred balances to around 45% of the limit.

A few months later, they cut my limit by 50% which has directly affected my credit score, claiming a review of my circumstances, which frankly had not materially changed except to improve slightly.

Their behaviour is at odds with any other credit card (all others are well below their limit and reducing), and I think somehow it was not an impartial act.

During COVID they equally quickly granted a bounceback loan for my business account and refused to extend the terms, staying I had previously had an IVA on my personal account ( settled in 2017). I might add I didn't pursue a PPI claim against them because of the IVA.

I feel deliberately treated in an unfair way.

Twice they have accepted business from me to then change the situation.

Apart from rearrange everything away from them, what can I do?

Great discussion all, thanks.

Interesting how the facts (and to some measure the mood) sit with the financial institution which lest we forget engaged in practises that nearly bankrupted the industry.

I largely respect the opinions, but generally disagree with the sentiment.

born_again

gigasmee said:

born_again said:

gigasmee said:

Hi,

I recently took out a NatWest Credit card with 23 month 0% interest on transfers and transferred balances to around 45% of the limit.

A few months later, they cut my limit by 50% which has directly affected my credit score, claiming a review of my circumstances, which frankly had not materially changed except to improve slightly.

Their behaviour is at odds with any other credit card (all others are well below their limit and reducing), and I think somehow it was not an impartial act.

During COVID they equally quickly granted a bounceback loan for my business account and refused to extend the terms, staying I had previously had an IVA on my personal account ( settled in 2017). I might add I didn't pursue a PPI claim against them because of the IVA.

I feel deliberately treated in an unfair way.

Twice they have accepted business from me to then change the situation.

Apart from rearrange everything away from them, what can I do?

Which is a meaningless figure generated by CRA's & never seen by lenders.

Clearly they have found that your income to debt ratio is above the amount that they are happy to stand.
All lenders are free to amend their risk levels at any point.

If you are not happy then complain. But they would be within their rights to not change the decision. As it is based on a business risk decision.

My total debt to income has improved since they approved my original application and balance.

All I have done is move money around to accelerate my debt reduction (thought that was the point of zero % transfers), which has been working, so I would say it's their criteria that have changed.

I know they are within their rights to do what they want.

That doesn't mean we have to assume they are doing it impartially or in good faith.

Do you still have the cards you transferred from?

If you do then look at the total amount of credit you have access to on ALL cards, that is what NW are looking at.

Yes balance transfer can reduce debt. In reality it should be aimed to pay off within the 0% period. As many have found out, never a guarantee that there will be offers in the future.

They are doing it to reduce their risk & to also make sure that they do not fall foul of any claims around affordability with the limits offered.
As per T/C they can close the account at any time & request repayment.

MattMattMattUK

gigasmee said:

MattMattMattUK said:

gigasmee said:

Hi,

I recently took out a NatWest Credit card with 23 month 0% interest on transfers and transferred balances to around 45% of the limit.

A few months later, they cut my limit by 50% which has directly affected my credit score, claiming a review of my circumstances, which frankly had not materially changed except to improve slightly.

A lot of lenders are reevaluating their appetite for risk, they reviewed your circumstances against their new model and chose to reduce their exposure. Your credit score is meaningless and made up, the fact that is has gone up or down is equally meaningless.

gigasmee said:

Their behaviour is at odds with any other credit card (all others are well below their limit and reducing), and I think somehow it was not an impartial act.

Their lending model may be different to the others, they may feel more exposed because it is a 0% rate so a lower priority for you to repay etc. It was not impartial, it was rational bases on their models.

gigasmee said:

During COVID they equally quickly granted a bounceback loan for my business account and refused to extend the terms, staying I had previously had an IVA on my personal account ( settled in 2017).

They were required to grant the BBL as per government requirements, where as the extension was a commercial decision and so someone with a recent history of an IVA would not be someone who they would want to lend to.

gigasmee said:

I might add I didn't pursue a PPI claim against them because of the IVA.

You can add it, bit it is entirely irrelevant. 

gigasmee said:

I feel deliberately treated in an unfair way.

Twice they have accepted business from me to then change the situation.

Apart from rearrange everything away from them, what can I do?

You have not been treated unfairly. The BBL it was you who tried to change things and the second a lender can reduce a credit card limit at any time.

You can like it or lump it, you have no right to a particular limit or even to a credit card.

I appreciate your clear and detailed response.

They needn't have approved the bounceback loan on the first place.

That would have been clearer.

It might have been clearer but they were not allowed to refuse BBL applications apart from in cases of fraud.

gigasmee said:

No-one has a right to a credit card by your reckoning and actually I agree.

No-one has any right to any form of financial product actually.

So I think that statement, while accurate, frames your response as valuable but slightly antagonistic, which is fine. Let's not forget financial businesses don't have the right to exist either, and their model builds is the consumer into itself as a profit margin with risk accepted.

NatWest more than most have played that past the margins Fortnite own sake and failed.

Lending has been tightened, the regulator seems to be far less happy with lending, banks have been burned quite a lot over the last few years. That is the point though, they are reducing their exposure, especially to higher risk customers which those who are carrying credit card balances are. Margins in banking are tight and there is a real risk of bad debts increasing over the next few years, better to make solid profits and play it safe for a few years than risk higher margins and make nothing. 

The thing to remember is none of it is personal, to then you are a number, a risk evaluation, they do not care who you are, or how you feel, they only care about sitting in the risk margin that they have deemed acceptable.