A final round of new credit card rules intended to protect consumers goes into effect on Aug. 22. Most of the credit card companies and banks are cutting credit limits, fees and rates on their credit in order to help bring these new laws into place. Most of the time when the economy is down so far, credit limits are cut like this. Credit scores are hurt for anyone who has this limit changed. To help your credit limit stay the exact same or get higher, you will find things you can do.
Credit card limits slashed across the board
During the recession, most credit card companies have been harder on their consumers. Before new credit card rules have to be upheld, banks who use credit cards are trying to pull in all of their risk. You will find many people getting their good credit scores hurt because of slashed credit card limits, reports Bankrate.com. Dennis C. Moroney, research director of bank cards at TowerGroup, told Bankrate that credit card companies are reducing credit lines and closing accounts. He said that even people with higher scores that are cut down from 750 to 720 are having trouble getting credit.
Credit limits make credit scores drop
In just the last few years, over 60 million cardholders have had troubles with losing credit limits. ”Risk trigger” are what they call things like regular late payments or high credit card balances, which Credit Card Guide explains some of these people having their limits cut haven’t even done. Having your credit limit cut isn’t just an inconvenience for people. It really hurts credit scores when a cardholder has an outstanding balance also. Credit line cuts aren’t just a concern considering one of probably the most significant things in a credit score is debt-to-credit ratios.
How to protect your credit card limits
Eva Norlyk Smith at Credit Card Guide has some tricks to help any person who would like to increase or keep the very same their credit limits. You can always call and ask. Most credit card accounts qualify for credit limit increases once a year. Your balances should be paid off each and every single month. And use the credit card a lot, but don’t exceed 50 percent of the credit line. Make sure you pay all of it off on time. Don’t cancel any credit cards, don’t apply for any new credit cards and never ask a credit card company to pull your credit report. A credit check is just as bad as applying for a new card.
Bankrate
bankrate.com/finance/credit-cards/credit-card-issuers-slash-credit-limits-1.aspx
Credit Card guide
creditcardguide.com/creditcards/credit-card-tips/higher-credit-limit-6-dos-donts-342/
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