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Pure Hogwash reasons for a CLD


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I am sure many of us have had credit lines cut recently. I have had 4 cards cut my limits so far and I have closed each of them. It amn amazed at the (dis)ingenious "reasons" they give for this action - trying to make it sound like it's something we did. Let's pool our collective experiences here so maybe some day this information can be presented somewhere it will do some good. I'll start.

American Express CLD'd me in November, giving the "times are tough" reason. The new, improved CL I had was about $200 more than my current balance at the time. Over the next 4 months I paid it down another $1000 without adding any new charged. They cut me again this month, again to about $200 more than I owed at the moment. At that time I figured out that Amex no longer wanted my business and I closed the account. Here are the reasons given (and the truth behind the "reason"

1. Your total debt is too high with American Express or other creditors.

My total debt is $50,000 lower than it was when you gave me the card, and $1000 less with Amex than it was 4 months ago. Now, all of a sudden, it's too high? In addition to the 19% utilization on credit cards I owe $85,000 on my home and $4,000 in my car.

2. The balance on your American Express card is too high relative to your credit limit.

No kidding, after you reduced it twice in 4 months by almost 50%!!!!

3. The average amount of payments in relation to your overall balance on your American Express account(s) has been too low.

I have always paid more than the minimum payment you requested. If this was an issue, why not simply raise the minimum payment?

4. Too many creditors have recently reviewed your credit.

No kidding... including you every month. Like I have some control over that?

5. Your credit score as provided by TransUnion. According to TransUnion, your score is based on the following factors in your credit report:

5A. Proportion of balances to credit limits on bank/national or other revolving accounts is too high.

According to my TU credit report, my utilization is 19% and my credit score is 789.

5B. Length of time revolving accounts have been established.

My oldest, Wells Fargo, is 6 years old, and has a $50,000 line.

5C. Length of time accounts have been established.

I don't know if this applies to the Wells Fargo account being my oldest at 6 years or their account at 1 year.

5D. Time since most recent account opening is too short.

Yeah - 1 year - it was YOUR account. Is Amex saying I should have has an open Amex account before they opened it? BTW, because of identity Theft committed against me 30 years ago, it took that long for me to even get an Amex account.

My other Amex account was closed for this reason:

6. Your spending patterns.

Like they would know my spending patterns. I never used that other account - not once. This account that I just closed this week was used only for a single BT and paying to the Amex Credit Secure credit monitoring service.

There you have it, kiddies - pure hogwash "reasons" to CLD. Let's hear from others.

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Why can't they be honest:

OUR COMPANY WAS JUST GIVEN XXX BILLION DOLLARS IN FEDERAL BAILOUT MONEY, THAT YOU AS A TAXPAYER DID NOT AUTHORIZE. IT IS OUR POSITION, IN ORDER TO MAINTAIN LAVISH BONUSES, THAT WE DO NOT EXPOSE OURSELF TO DEBT, BECAUSE WE DO NOT WANT TO BE IN THE POSITION TO BAIL YOU OUT. Therefore we have decided to cut your credit limit

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In Jan....Lowe's cut my credit limit within a few dollars of my "maxed" out balance.

The reason...b/c of the hard times and state of the economy is what it said in my letter. I am almost positive if I paid it off...they would cancel it. They get nothing but the bare min. from me. If we happen to lose our jobs....they will be the first WE DONT pay.

Hopefully I'm just joking

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In Jan....Lowe's cut my credit limit within a few dollars of my "maxed" out balance.

If I'm not mistaken (I'm going by memory here) Lowe's is underwritten by GE Financial- which is suppose to be a AAA rated bank. They received 124 Billion in bailout money- Why are we bailing out AAA financial institutes?

I think they are really afraid people are going to do max exodus on bill payment after seeing all the money these thieves get.

STEAL A LITTLE AND THEY THROW YOU IN JAIL- STEAL ALOT AND THEY MAKE YOU KING!

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GEMB is in poor condition. They are dragging down GE to the verge of insolvency.

Lowe's cut my card limit to $214. I have never been late or carried a balance beyond a grace period since early 2004.

The thing to remember is that they are cutting limits proactively. Open credit lines are a potential liability. You, as a single customer, mean nothing to them. They are just trying to survive right now. Most people have boatloads of unused credit anyway (including me, even after the CLDs), so let them chop away. Its meaningless. Hopefully this is a long term trend that continues. It is healthy.

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