Amex CUTS Credit Limits Without Warning: What You Can Do
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- Опубликовано: 11 май 2020
- American Express and other credit issuers are cutting credit limits without warning. Here's what you can do. More info on Financial Reviews: bit.ly/386qLd3
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I received an email from American Express saying that they were reviewing my account and considering decreasing my credit limit, however if I made a payment of a little over $1,000 that would essentially stop the investigation and there would be no decrease.
I've been restoring a classic and using my American Express like a debit card to earn SkyMiles, making payments to cover each part order in real time.
I did my part immediately, so I will be very angry if they don't keep up their end of the deal.
The strongest argument for a bank decreasing your credit limit is to minimize their risk. Since most of us are travel credit card oriented and aren’t traveling, having our limits decreased shouldn’t be a cause for concern. However, the potential problem is if the banks are reluctant to increase the limits when travel en masse resumes.
Found this in an article about Amex lowering credit limits:
American Express and Discover are not only payment processors, but act as the lenders themselves. This is known as a "closed loop" payment network. When you swipe your American Express credit card, Amex not only moves money from your account to the merchant's, but it actually loans you the money itself.
This creates an entirely different level of exposure to recession fears. Not only could payment volume slow down, but consumers could have trouble paying their bills in a prolonged downturn.
I am a 19 y/o student with the Amex Green and I know for sure my "check spending power" limit has been significantly decreased. Used to be around 13k was my max approved. Now it's about 3.
You don't know the excitement I get when I see you publish a 20min+ video
Aviantei Agree.
Yep! Did mine and RUINED my credit score.
I haven’t been affected; however, I previously requested lower limits to avoid a possible FR.
Never had an issue with reaching credit limits but Thank you for the heads up my man 🤙🏽
Thanks Sebby. I started watching your channel since Oct of 2019 with no credit. I followed your tips and got a secured card and today I got officially my first Fico score of 734 with Fico 9 and 720 with Fico 8. Thanks.
Congrats!! :)
Sebby: if you could give a thumbs up- doesn't cost you anything and helps the algorithm. Me: I felt that.
They started me off at $1000 for blue cash everyday and they haven't increased my limit a year later.
They started mine at $5000 and I have not received a cli in almost two years.
That’s crazy they started me off with $15,000. I was shocked when they gave me that, it’s increased to $25,000 since then
@@lugiadark21 You can usually request a CLI on the website with it only being a SP but now with the stuff going on I don't think you'd be successful unless your Experian score is spectacular that's what Amex uses
It's really nasty if one is in transit (traveling) and stranded due to the cut. Perhaps we need a national credit line and even a national bank which services all citizens.
Listened to Sebby's wisdom and paid off the balance before the statement date. I do leave
You mean you leave some for when the statement hits and pay that off?
Hahaha. That ending tho! 😂
3 credit card limits cut this year. Now I have a tough call to make since now my total credit limit is now under 50k and my utilization is now over 10%. However, all my balances are on 0% promo interest cards til late 2020/early 2021, but I also have many inquires past year or two due to my credit card hobby interest. Was furloughed from my job last month and all I hear now is cash is king.
I would say keep enough money on hand to make the payments on the cards you have and not worry too much about the utilization. Your score bounces right back up once utilization is low; but the inquires last a year or two and missed payments last quite a while.
These companies are simply mitigating risk. Anyone that's flexing high unused credit line while things were good it's about to feel insulted. Proactively lowering and shifting credit limits is a smart move guys.
i agree 100% i would constantly wonder why folks with limited income and spend would need $100k - 200k+ in credit limits. Things are changing fast.
What you can do is NOT spend more than you make.
Crazy, I know...
I agree. But it sounds like the are also reducing people who don’t carry a balance. That makes no sense. They make the money from the transactions.
Have $55K credit limit across 5 cards with AmEx now and 2 charge cards. Never been through a Financial Review but did have 3 claw backs due to self-refer. No credit limit change so far and I keep my utilizaition at 0-1% on my credit report.
Limits unchanged on mine. My account is six months old, so it’s a relatively newer account.
Just got my notification from Carnival (Juniper) card, reducing my limit from $16000 to $15640. Not much of a cut, but did make one.
Do they still automatically increase your limit by 3 times after you have had the card for 2 months like they used to? I am thinking of applying for it but I'm wondering how this whole situation will affect me since I want to get a good credit limit
I have 4 Amex cards - They dropped my my BCE card from $13,500 to $8,500 a few weeks back... I called them and they asked my income and moved it back to $13,500. I dont use the BCE a ton which may have contributed. I PIF all my cards every month so they only make money on my annual fees and discount rates when I swipe.
Question. Chase recently pre approved me for two chase freedom cards. Would it be a good idea to take them on both of there offers or just be patient and grab one. To grab both will complete my CSR TRIFECTA. Thoughts.
They just cut me from $7500 limit to $2300. Never missed a payment ever on anything in 15 years. Credit score of 824. Utilization of 20% now it's 0 as I paid it off.
Sebby posts, I watch and click Like!
Citi and Discover both did this to me. I’ve never been late on any payment of any kind, be it credit card, auto, or mortgage, nor do I make only minimum payments. This resulted in a nearly 50 point plummet in my credit score, which over the long term will result in it being more difficult to get a decent auto loan rate, my auto insurance rate, and more. So, basically, I have worked very hard to get and keep a good credit rating only to be punished. It’s like having a car repossessed when all payments have been on time...makes no sense.
Thanks for this communication and wonderful video
Please advise as recently my existing credit card limit
has been reduced to 50 percent of previous limit
My monthly credit card utilisation ratio is below 10%
in old and new both limits scenarios.
Should i apply for new credit card with value of limit
reduction to maintain my current cibil score or
should not apply as my monthly credit utilisation is
well below 10 percent in new scenario. Please advise so that my cibil is not impacted adversely.
Yes, I notice that with my discover card. I was like what the hell.
Hey Ask Sebby, im thinking about grabbing the amex plat charles schwab flavor. in terms of sign up-bonus, will it affect any eligibility if i decide to get the vanilla or any other versions? should i get the vanilla first? does the vanilla have any perks that the Schwab one does not have? mostly interested inthe 1.25mr cash out since i wont likely travel any time soon. already got the amex gold and green card, and i dont dip into the buisness cards bc i dont have a buisness. thanks Sebby!
Not my everyday blue, they actually Increased my limit from 4500 to 9500@13%😊 2 mths ago. But i Never had a limit increase since issued 4yrs ago.
Most likely the cuts done to low int rate cards where they only make change.
Whats going on Sebby.......With this great video >>>>would it be wise to apply for a Amex BBP as a sole proprietor??? thank you....
6:39 seriously though if you were buying ten $700 computer wheel sets I would cut your limit too just on “the f are you doing! Are you high” factor. 🤣❤️😂🤣🤷🏾♀️
Does this apply to gold card holders? I have a zero percent utilization and 758 Amex Credit Score
Good explanation why AmEx more likely to cut limit. I have the Blue card for years because Costco only accepted AmEx. I used it for everything too. I basically stopped using AmEx when Costco changed to Visa and use Visa for everything. Within 6 months they cut my limit from $24K to $10K. It didn't really affected my score since my overal all limit didn't change that much. Now I only use the Blue card for grocery (3%) except when it's 5% for Chase Visa like now.
Back in 2008 during the financial crisis Amex sent me a "love letter" stating that they were suspending my Gold Card Pay Over Time and Sign & Travel privileges and that any purchases over the threshold for extended payments would be immediately due and payable upon receipt of my statement. They also stated that any major purchases might not be approved. I never ever used the extended payment option with them. I also have an Amex Blue Cash card where the credit limit was slashed from $25k to $10k and to this day the limit was never reinstated. But in their letter they detailed very specific reasons for suspending my extended payment options. 1: The timing of my payments showed a history of being made more than a week after the closing date or in some cases the day before the due date (I never missed a payment, ever.). 2: The balances on other credit cards was too high in relation to credit limits. 3: The amount paid to other creditors was mostly the minimum due. 4: My FICO score dropped significantly (because other creditors lowered my credit limits and my utilization skyrocketed). 5: "Predictive Factors" about my future credit worthiness was an influence ( I never missed a payment with anyone). I'm told that they might look at not only my past spending habits but where I spend could influence their decision to keep me as a customer. They eventually reinstated my extended payment privileges about a year later but I never used it. And the reason I paid other creditors the minimum due was because they were 0% interest balances; basically a free ride. I guess I was on the edge of being fired as a customer.
Hahaha Debby your the best and funny you mentioned the speed at witch you speak. When I watch your videos I turn the speed down to .75 to capture your information. Thanks again for all I've learned from you.
Gotta love that Ask Debby...
I have not seen any reductions in my limits through any bank so far. Chase, Barclay's, Citi(store cards), Amex BBP. Curious to see if I will see any changes. I keep my amortization around 0 to 1%.
My question to Sebby is that do you think Amex considers POT DIRECT as a credit limit? i have 35k both on my gold and plat and form time to time i also revolve though not too much. As of today all is well but i am curious about POT being considered as a credit limit
This is exactly what happened in 2008. Next up, your rewards are going to disappear without warning. And guess what, you will have no legal recourse when they steal them from you. I learned these lessons the hard way back in 2008/9 so take your rewards and switch them into Amazon dollars or anything else you have control over. And do it quickly.
I have a Blue from American express since '06 with a credit limit of 8k and a Hilton Surpass since last year with a credit limit of 8.5k. Utilization was under 3%. They haven't touched my credit limits, yet.
Do you think applying for a new Amex business card is harder to get now? I want to apply for a contractor business. Mostly I o buy new equipment and stuff like that!
When I worked at Barclays, we did CLD all the time based on changes in FICO. Most of the time, it was a result of you falling behind on another Barclays acct or a returned payment.
Thanks for the insight!
I recently got an American Airlines Aviator card (2019) via Barclays, as was assigned a very high interest rate. I have 700+ credit. Called immediately to ask for a reduction. Told me no. I called corporate offices, got lip service, with no results. I was always polite . you get more with honey than vinegar. The corporate office location was in Las Vegas so the rep said ? Odd .. because I know it’s not. Disappointed, for sure. They had three options, for interest rates and I never dreamed I’d get the worse rate. Now I only use it and pay it off. So frustrating . I won’t close it cause it will hurt me more. One thing I like about Apple Card, you see your rate and line available prior to getting it. Good idea to me. I’d be curious to see what you think about a interest rate reduction with Barclays. I have 28 years of good credit. Curious to know your thoughts ? Thx !
@@jasonb4988 You will never get a rate reduction just when you get a new card and no prior relationship. You could either take it or leave it. You could have closed the card if you weren't happy within the first pay cycle and it would not show up on your credit report. Sometimes after 6 months of on time payments, you could call again and ask for a rate reduction.
@@jasonb4988 i have had a barclay card for 10+ years and they won't give me a rate reduction with an 820 score. I won't close it as its my oldest card and a no annual fee. Plus I don't carry a balance.
Haven’t lowered any of mines yet. Also since this started I got the blue business 18k limit and Hilton Aspire 25k limit. Oldest card with them is only 2 years. Also have 6 other cards with them
So far i am safe with $40k in personal credit and $21k in small business credit plus a platinum card
Chase did this to me in 2008. I am in law enforcement and was moved to guard prisoners and did not have access to the internet or mail. They counted my payment as late. After a phone call they waved the late fee, but still reported me as late. They cut my limits in half and said i was scheduled to be dropped to a lower limit. I had never been late and had to make a payment of about 4K that day to get below my new limit.
If you didnt pay the 4k, would they charge you an overlimit fee? Doesn't seem legal that you can spend up to your legit limit, then they cut you below that number, and then they say you're over the limit??
KP I called them because I work law enforcement and due to a hurricane I didn’t have access to the internet or mail. When I explain to them the issue I had they waved the late fee but still reported my account as late. In this phone call I was informed that I had to pay a bunch of money right then or I would be over my limit. Mind you I payed my bill in full 6 mouths before and that was 7K. This was at the time when a lot of people were not paying their bills at all. For being a good customer this was the service I got. I took my lick and then found this channel and chase has made zero money off of me in almost 3 years. Is it legal who knows but I don’t have 20 lawyers and millions of dollars to fight chase. All I can say is THANK YOU SEBBY!
Reason for the increase in provision for credit loss, for the CPAs out there, is the implementation of CECL in FY20
The provisions for credit losses isn't because they are worried. They are required to increase reserves due to CECL regulations which were implemented in first quarter of this year.
Well i stick with discover, they raised my a few week ago.
Happened to me with USAA and pissed me off
300k month limit dropped to 50k. Extremely frustrating
There were few times i asked for limit increase with AMX. AMX do "soft inquiry" and always have a feedback for me in a very short time. soft inquiry won't lower my credit score. Stay away from CITI. I think you do he same with CITI you almost for sure will get a "hard inquiry" which will lower your score. Then they are company will let you know ahead that your request will result in a "hard inquire" if you want to go ahead or back of now. CITI is the worst for sure.
Yeah Citi always does a HP first time I asked for a CLI 3 years ago they told me that I've never asked for another 1 again and when they did give it to me it was a 1K increase I use my Citi cards once every and awhile to keep them open to keep my utilization padded and the age of the accounts
Here is what Citi says on its website: "We will not obtain a credit bureau report to evaluate your request, and you will receive a decision instantly." I did request an increase on my Citi card. I got instant increase and it has been almost two months since then. My credit reports do reflect the increase, but there is no hard pull.
@@yumama3831 citi lies. They did "hard pull" , my credit monitor will notify me if any thing like that happened.
Not sure if there's a video about this. I've never made a late payment, and AMEX has increased my APR by almost 6%. Does this happen?
USBank didn't lower my credit card limit, yet.
Instead, they started charging an annual fee of $25.
I will decide next year whether I will keep the credit card.
For now, the fee is inexpensive.
Right after watch this video I got I letter from Amex , they decrease my limit from 5k to 2.400 , so I call them , so the guy was very kind and he ask me some question about my income , my job , my assets, he ask me how much I can pay now , I told him 1k so he agree to give me my credit back if I pay just 500 right now, my credit will be back in 30 days , the other option is go through a financial review which is not necessary if I pay 500 so that gonna do , good think I call them rights way .
what was your balance? Did they give you a reason for decreasing initially?
if any of these credit card companies cut my credit, I'm cutting their credit card 😐
Amex can kiss my azz!
And then FICO lowers ur score....
Shitty
Annab56- it will go back up in 6 months
I received a letter dated 8 May 2020 from Amex. They reduced the limit on my Amazon Prime Business from $15,000 to $5,000. They cited low usage as the reason. They left Simply Cash Plus ($10,500), Blue Business Cash ($13,500) and my old Blue personal card ($10,000) alone-despite rarely using them. Historically, I did use those cards more than Amazon, but now only Blue Business Cash gets much spend. I am leaving it alone; $5,000 is plenty for my spending.
Liquidated all my AXP position.
Sooo informational
I’ve never missed a payment, put 10s of thousands of dollars through their cards with out issue. Sometimes over $1000/day in adspend. They just slashed my balance limit to $3300. Absolute joke.
it really is!!!
They sent me a warning email with the option of making a large payment to avert a further investigation or credit decrease, so I paid their ransom.
I'm spending 15k to 20k a day on ads for one of my ecom businesses,
They won't let me spend over 3k at a single charge and I used to be Able to spend a crazy amount.
I found the secret is a lot of smaller payments , if you add in big payments you need to pay those off otherwise it waxks up your whole credit limit on no limit cards
I offered to wire amex 100k to just let me spend larger amounts on my card without the 3k limit but it doesn't matterso I don't have the problem and they said.
On the phone they told me after 3 hours they aren't giving out any loans at all, they froze every single type of new loan offering and my vendor capital account new requests.
Additionally Wells Fargo i believe is having liquidity and insolvency Problems
Look for more printing press money to "fix the problems"
Sebby- “Slice of the pie instead of the whole pie”
Also Sebby- *Uses a cake emoji”
🍰
Piece of pie.
Easy as cake.
Oh, wait!
Reverse that.
Weird thing. Im a college student with a 30K limit on one card. I was stoozing some funds of about 15K, and paid off the entire balance early may. Just checked my account, limit still 30K.
I don't know why some people who actually need their limit are getting it cut while im left with a 30k limit, which I have zero intent of using. I think the most ive ever used at a time was 3K.
So what you are recommending me is to pay off my Blue Cash balance ASAP?
They cut mines as well.. pissed. Calling nothing will be done, been with them for 8 years...
Amex and Discover cut my credit line also.
They cut mines by 2000 down to 8500 it's was on my amex blue cash and I've never missed a payment only had 1 card with a balance and that was my Citi bestbuy visa 1500/7500 limit.
We have been credit card hacking for years with credit cards that have no annual fee. We just got the AMEX gold this year to try travel hacking. We have no spending limit which hasn't seemed to change (yet). We are actually considering canceling this card before the renewal because we're not sure we'll get the value of $250/year due to all the travel changes surrounding this pandemic. AMEX adjusted the benefits of all their higher and lower-tier cards but skipped right over the gold smh
They did not decrease my limit, oddly enough, it seems like it was increased. Don’t remember getting a notice. In any case, I’m downgrading my annual fee Delta card, unless they waive it for me
I'm keeping my eyes on my Chase, and American Express limits so far no change I've been a customer of Amex's for 23 years now and Chase's for 21 years my income hasn't been affected by this economic downturn and I'm still making my payments should I be concerned all my limits on every other card has stayed the same except for my Discover IT Miles the limit increased from $6K to $8K and my IT Cash went from $8K to $10K I've only been a Discover customer since 2016 and rarely use my Discover cards
I cut mine up years ago, because it was refused by so many retailers, they have to pay AE too high a commission.
My plum business card had no preset spending limit and they just set a $100k limit. My balance is $149k on it so they suspended all my spending. Not cool.
Eh, they actually increased mine by $7500 without me even asking. Hopefully, they don't lower it, though. I keep a zero balance but I use it all the time.
Amex cut the limit to my BCE by $5k. Their reasoning was that I don't use my card that much, and they are correct, it's among my least used cards. I do pay my statement balances in full every month though, for all my cards.
I have recently experienced a few of my creditors have lowered my limit even though I have never missed payments on 30 of my credit cards I have always paid before due date excellent credit now my credit score has dropped immensely so disappointed I called in and they had refused to increase the amount to its original limit and fortunately this is not at any Fault of Our Own due to the coronavirus not being able to work
Well... I guess credit limit is important for either new credit folders and or people who use their credit as leverage. But normal people if they get cut $10k from their overall credit. It isn't a big deal. I currently have $122+ with charge cards. So $10 to $20k less wouldn't really hurt me. But YMMV lol
As much as it sucks to lose some limit at least these financial companies are mitigating risk. That’s a good sign. 🤷🏾♂️
Thanks for the applicable tips. Haven’t been affected by this myself but, someone I know may be.
Agree, companies need to take steps to mitigate risk. Sucks for the consumers.
Fuck these financial companies
Terrance Pride that's right T tell them lol we trying to eat and they bullshiting
@@AskSebby yet without the customer they wouldn't be where they are.....I don't.have any cc ..just like your channel
You’re talking about the no pre set limit
I have a feeling that Discover may do the same thing. Considering that they are mostly credit card focused. What's your thoughts on Discover asksebby?
Thoughts on Discover shutdowns here: ruclips.net/video/a45HZ2GYMog/видео.html
Discover is doing the same
Uh-oh. Just applied for one and got $12,500 limit and already put 10k on it. About to check if they reduced mine....
It happened to me. Without warning, my limit was decreased from $20,000 to $10,940. I called customer service and the representative opened a reconsideration case for me. I was contacted by a credit analyst the next day and was asked to submit proof of income. Since 99% of my income consists of a salary I receive from my employer, the analyst and I agreed that I would submit my paystubs rather than my tax returns. Within a day, my limit was reinstated. Out of curiosity, I asked the analyst what triggered the credit limit review. She explained that an unusually large purchase had tripped the algorithm. Apparently, my espresso machine was deemed a risk by the algorithm!
The majority of my active Amex cards besides the Blue Business Plus are charge cards, so no clue what limit they've placed on me. I do have the Blue Cash and Everyday card as sockdrawered foundation cards. These have not seen any decrease in credit limit yet. I did move some of the credit limit to my BBP a few months back. This card is pretty active but I never spend more than $5k a month on my business expenses. Now I'm wondering if I should be more cautious with using it to pay my taxes.
Ok, Just noticed that they dropped my Blue Cash limit from $18k to $13k. It's one of my oldest card but I put less than $50 on it a month so not too surprising. Must have done it 2-3days ago. Didn't notice it last week. Other cards still intact.
Good thing I have the gold card and don't have to worry about this!
It’s impacting us too. They are lowering the invisible spending limit.
I usually have pretty low spend and pay off my card multiple times per month. Grad student making $35k, haven't seen any decreases. (actually had an increase from discover)
Yeah Discover upped both of my cards recently also usually PIF before the statement cuts they bumped both my cards $2K a piece without asking usually about every 6-7 months they've bumped them up sometimes I've asked and others I haven't
#Close your American Express
Captions: "hey guys it's Sebastian from ask Sebby...."
Looks like they got it!
Wooo! It's about time! :)
Yes they did even though I've never missed a payment
😔 How much did they reduce it by? What was your utilization like?
Ask Sebby reduced mines by almost 10k. My limit was 33 now its 24k utilization at 6%
Age of account? How long a customer overall? They ain't playing around that's for sure.
@@AskSebby they reduced 4 of my 5 down to 1k and they had between 13-15k limits initially. They didn't have a balance on them so I guess they didn't want me using it
Carlice Lewis assholes 😠 I would repay them by spending only a dollar & 23 cents every 3 -4 months on their stupid cards use a credit union for spend banks don’t give a f about anyone screw them
They lowered Centurion card (black card) limits?
Sebby I have a 810 fico but AmEx just tanked 50 pts. They lowered my score no warning that I know of. I admit I have been using a lot over last 2 to 3 months. Would paying off the entire balance bring back up the score by next statement. Have you ever seen 50 pts go back up the next month??? Or will it just allow a few pts a month.
Pay some of the balance off before the statement close date to keep utilization low, and then pay the remaining balance when the statement closes.
What credit limit. AMEX always says NO PRESET SPENDING LIMIT?
Ask Sebby, how often should we use our credit cards to avoid limits being decreased because of inactivity?
Depends on card. If it's a store card or a contender card you might have more leadway. If it is a mainstream card say like everyday cash I would be spending 5 to 10% of my cl every couple months if not every month. Banks dont want the liability on there books if your not using the card. It's not just defaults they are worried about.
Wonder if other issuers like chase are going to follow suit...i never use near my credit limits and pay in full every month
i've seen in many other videos that its happening across the board with other lenders.
Lenders can only lend x amount to thier assets that is part of it too.
Feels pretty reasonable. You hit it on the nose; Amex makes their revenue on credit cards alone. Why would they not adjust the business model accordingly?
Synchrony bank does this all of the time.
I missed a payment by 10 days. I paid it down to 0, they did a surcharge and I missed it by 10 days. Since it's Synchrony, they took most of my cards down without notifying me. I've lost 70 points on all credit bureaus. I am sick.
I love ❤ your video's very smart and intelligent young 👨 thank you. 😊
Sebby- American Express offers a savings account.
What about co-branded card's like Navy Federal 🤔
No cl reductions for me yet.
Does having a referral boost your chances of approval when applying for new cards?
No
Will they send out notices to us or just slash the limit on our cards without telling us?
In my experience credit cards companies do not give you a heads-up that your limit will be slashed. They act first, then send you a letter or email after the fact. I’m assuming a reason for no warning, is that companies do not want to give people a chance to run up their balance the last minute.