Decreased credit card limit
Discussion
Hopefully the financial boffins can help and advise.
I got a credit card to build up my credit limit a year or so ago because I didn’t have any credit cards for years my credit score needed to improve.
I got a credit card with aqua for which I only use to travel to work via train/ tube roughy £200 a month which is paid off in full each month.
The limit started at £700 the they increased to £2200 then increased again to £4400.
I’ve only ever spent no more than £200 a month and always paid off in full each month and now they have decreased the limit to £1500.
“We have decreased the limit on your aqua card to £1500.00 as we feel it is more suitable for your level of use. A letter will follow shortly.”
That part doesn’t bother me but I had a quick google and some articles mention that this can affect your credit rating.
If anyone can help / advise it would be appreciated.
Cheers
Sunnygym
I got a credit card to build up my credit limit a year or so ago because I didn’t have any credit cards for years my credit score needed to improve.
I got a credit card with aqua for which I only use to travel to work via train/ tube roughy £200 a month which is paid off in full each month.
The limit started at £700 the they increased to £2200 then increased again to £4400.
I’ve only ever spent no more than £200 a month and always paid off in full each month and now they have decreased the limit to £1500.
“We have decreased the limit on your aqua card to £1500.00 as we feel it is more suitable for your level of use. A letter will follow shortly.”
That part doesn’t bother me but I had a quick google and some articles mention that this can affect your credit rating.
If anyone can help / advise it would be appreciated.
Cheers
Sunnygym
I understand that Aqua has a sky high interest rate and is set up for people who have a poor credit history. Perhaps they dont feel that they make enough profit from you.
I suggest that their way of doing business is set up for people in that sector and if you can, i would look for another credit card company that is more mainstream and reputable. When it is set up cut up your Aqua card and tell them to close the account.
I suggest that their way of doing business is set up for people in that sector and if you can, i would look for another credit card company that is more mainstream and reputable. When it is set up cut up your Aqua card and tell them to close the account.
Because they see you as 'risk exposure' without any profit.
You use a small amount up, you repay it in full, you pay no interest = they make no money. Meanwhile the higher the credit limit, the higher the risk exposure they are carrying - one day you might suddenly max out the card and decide not to repay it.
There's pressure on lenders to avoid unnecessary credit opportunity (i.e. large lines of credit that people can access with no controls).
You use a small amount up, you repay it in full, you pay no interest = they make no money. Meanwhile the higher the credit limit, the higher the risk exposure they are carrying - one day you might suddenly max out the card and decide not to repay it.
There's pressure on lenders to avoid unnecessary credit opportunity (i.e. large lines of credit that people can access with no controls).
I could be wrong but I think there is a fixed limit to how much credit such institutions can offer in total to all of their customers. Your credit limit is what they have offered you so if they are approaching their limit they won't be able to offer credit to new customers without clawing some back from existing customers. Taking it from people who don't use all of their facility is a good option.
I really struggle to understand why people are so obsessed with their credit score. It feels like snake oil to me.
To be a good risk all you really need to do is make sure you don’t borrow lots, pay any loans / mortgages on time, pay off your credit card in full each month, stay on the electoral register and try to keep current accounts open for a long time rather than chopping and changing.
What random number each agency assigns to you is irrelevant to most lenders as they have their own method of evaluating how good or bad a risk you are to them and how much they want to lend if you ask for credit. If you’re not planning on getting any form of credit then it’s a complete load of b
ks worrying about it.
To be a good risk all you really need to do is make sure you don’t borrow lots, pay any loans / mortgages on time, pay off your credit card in full each month, stay on the electoral register and try to keep current accounts open for a long time rather than chopping and changing.
What random number each agency assigns to you is irrelevant to most lenders as they have their own method of evaluating how good or bad a risk you are to them and how much they want to lend if you ask for credit. If you’re not planning on getting any form of credit then it’s a complete load of b
ks worrying about it. unident said:
I really struggle to understand why people are so obsessed with their credit score. It feels like snake oil to me.
To be a good risk all you really need to do is make sure you don’t borrow lots, pay any loans / mortgages on time, pay off your credit card in full each month, stay on the electoral register and try to keep current accounts open for a long time rather than chopping and changing.
What random number each agency assigns to you is irrelevant to most lenders as they have their own method of evaluating how good or bad a risk you are to them and how much they want to lend if you ask for credit. If you’re not planning on getting any form of credit then it’s a complete load of bks worrying about it.
This 100% To be a good risk all you really need to do is make sure you don’t borrow lots, pay any loans / mortgages on time, pay off your credit card in full each month, stay on the electoral register and try to keep current accounts open for a long time rather than chopping and changing.
What random number each agency assigns to you is irrelevant to most lenders as they have their own method of evaluating how good or bad a risk you are to them and how much they want to lend if you ask for credit. If you’re not planning on getting any form of credit then it’s a complete load of b
ks worrying about it. It seems to be one of the latest obsessions
cuprabob said:
Alucidnation said:
Not sure of the point in having a credit card and clearing it at the end of the month.
Although not as lucrative as it once was, some cards have cashback plus you get Section 75 protectionin certain cases.emicen said:
Also reward points / airmiles and emergency back up in case you need it.
This- using 140000 miles this summer to fly Havana- Atlanta- New York- London, first class other than return home which is premium. Roughly £1200 for three people. Put everything on credit card fir the protection and miles.I use a credit card for most things because:
1) reward points. I’ve used these to buy some pretty good things over the years
2) section 75 protection
3) the interest that leaving the money in the account for an extra few weeks brings
None of them have ever been necessary, but if you can, why not use every advantage you’re given?
1) reward points. I’ve used these to buy some pretty good things over the years
2) section 75 protection
3) the interest that leaving the money in the account for an extra few weeks brings
None of them have ever been necessary, but if you can, why not use every advantage you’re given?
Alucidnation said:
Not sure of the point in having a credit card and clearing it at the end of the month.
Debit card is all i have ever had and hasn’t affected my credit score from not having one.
I remember as a teenager watching a family get turned away from the car hire rental desk on holiday because neither of the adults had a credit card with them...Debit card is all i have ever had and hasn’t affected my credit score from not having one.
Gassing Station | Finance | Top of Page | What's New | My Stuff