| Saturday, October 11, 2008 |
| Some Consumers See Credit Cards Canceled |
NPR reports: Some Consumers See Credit Cards Canceled One person who experienced the crunch firsthand is Lynn Murphy of Little Rock, Ark., who admits she's a big user of credit cards. She has quite a few of them and carries some hefty balances. She says she never misses a payment and always pays at least the minimum due.
But a few months ago, Murphy was a day late paying one of her bills, so she called the credit card company to try to get the late fee removed. The conversation went in a very different direction.
"They said, 'Well you have good credit, but look how much debt you have, and how much income you have. We're scared you won't be able to pay us,' " Murphy says.
Murphy says the woman on the other end of the line lowered her credit limit right then and there.
"There was only like $1,000 leeway and she probably took $800 off," she says. Labels: Recession Obsession |
| posted by Boston Gal @ 12:43 PM *
* Subscribe to Boston Gal's Open Wallet |
Links to this post:
|
| 6 Comments: |
-
Sounds like the woman at the credit card company did her a favor. While it's nice to have ample credit available to emergencies, it also leads to bad habits. Very, very bad habits.
-
So what? This happens everyday.
-
save us from ourselves, so long as we can blame our problem on you. hopefully cc companies continue to reduce people's limits as they pay down, although, something needs to be done to mitigate the FICO impact of lowering limit increasing usage thereby lowering FICO
-
That sounds fishy to me. I've never heard of a credit card knowing, tracking, or inquiring about your income, even when you're applying for a new card or asking for a credit increase (there's always a blank asking what your income is, but you can leave it blank or put in $0 and still get cards, plus there is no way for them to verify the numbers anyway).
-
@Meg
I don't know about you, but every credit card application that I filled out, I had to put my name, social security number, income, job title, company, salary, how many mortgages/credit cards. They would then validate that with their chosen credit company (the big three). If you look at your credit score, it has your salary info. The IRS cannot give them your info, but you are required to fill out a lot of things if you file for credit. It it has not been updated in a while, a credit card company will ask for new info (mine have).
I guess maybe you dont work with the same companies I do, but I have bought through GMAC, Nissan AC, and have cards with CitiBank and AMex. These are pretty basic requirements for them to determine your debt to income ratios.
-
My father's business credit card with a $0 balance was cancelled. My Citibank card with a $0 balance was cancelled. A few of my friends' credit lines have decreased...
The issuers are scared. If everyone defaulted on the current balances on their cards, they wouldn't be able cover it. They don't want to chance more credit being used. They're covering their you-know-whats...
I have one question. If they're cancelling cards and lowering credit lines at the drop of a hat, what does that mean for our credit scores? Isn't this lowering our available credit, and in turn, making the debt to available credit ration higher?
|
| |
| << Home |
| |
|
|
Sounds like the woman at the credit card company did her a favor. While it's nice to have ample credit available to emergencies, it also leads to bad habits. Very, very bad habits.