Question about credit cards

[banquo's_bumble_puppy]

Can credit card companies arbitrarily lower credit limits and (hypothetically) if you happen to be over when they do this what would happen?

[Whirlpool]

Usually when you get over the limit, credit card companies tend to increase your limit , not lower them.

But if you happen to seldom use it , just like my experienced, they lowered my credit limit.

I'm not into credit card so my one & only is used very seldom , so after a year ,
when I renewed my membership , they reduced my credit limit.

But this is in my country , I don't know there.

[Spock Jenkins]

I haven't seen it happen, but if they do lower your limit and you're over the amount that they lower it to - you can't use the card until you pay it down to the level that leaves you available credit to use. This will also have an adverse impact on your credit report as lenders don't like to see accounts over their limit. This also may trigger a rate increase since being over the limit is viewed as a negative.

Like I said, I've never seen them do this. What more often happens is that a person will charge their card up to the limit then the finance charges put them over.

[JustAFriend]

A private company like a credit card company can do anything it wants.

....and they will, too.

[Heid the Ba']

It depends what the terms and conditions of the card say, and it depends what the terms and conditions of the cards say.

No company can do anything it wants; it is limited by its charter/M&As/legislation. Neither can it do anything it wants in relation to others, its actions will be limited by contractual terms and obligations.

[tdvance]

They can--and have in the US. I don't know what happens exactly if you become over-limit because of a lowering of the limit. Most likely, I'd guess you can't use the card till it's paid down.

With the funniness of the credit market lately and the likelihood of what was presumed good credit (perhaps for dubious reasons) is now bad credit, it's actually become necessary to lower some credit limits.

[suntrack2]

"credit card", interesting topic. I think the experiences are quite different card to card. :) uptill I was just filling the paper withdrawl sleep with the bank, and now I have taken one credit card of that bank, but I never use it charge at anywhere, means I never give up my credit card number at any place, just I insert it into the ATM machine just for the use of withdrawl of amount, I had some calls, some mails, some short messages on the cell phone, that "you can buy such and such items, give your credit card number, no money now, forget about money, if you have no money now sunil then its ok, try our credit card, we are giving you a large limit," for which I said strictly "NO" I put "NO" all the time in every questions. My Mrs. having some different credit card, but she never use it anywhere.(since we have no habbit to use it) :)

In short credit card is a crocodile(what I can best opine)

Sunil :)

[mugaliens]

If your purchases predates their lowering their limits, they cannot legally enforce any contractual penalties arising for your being over, as you range those charges up in full and honest faith that you were not exceeding your limit under the terms of the contract.

If they try, then dump them and switch to a company with a better reputation.

Better yet, get out, and stay out, of debt!