Posted on 05/05/2020 5:37:56 PM PDT by fluorescence
About 1 in 4 credit card holders — or almost 50 million Americans — had their credit limits cut or their card accounts closed in the past 30 days, according to a consumer survey by Lending Tree's Compare Cards website. The reductions particularly affected men between the ages 18 and 38, according to the survey.
Lenders aren't required to tell customers when their credit limits are lowered, LendingTree analyst Matt Schulz said, adding that many lenders made their moves in the past month to avert losses if cash-strapped consumers struggle to keep up with payments amid surging U.S. unemployment.
The credit curbs happened just when household budgets are particularly strained from coronavirus-related job losses and families are believed to be using their cards more frequently. The Lending Tree survey reports that 42% more cardholders said they used their credit in the last month compared to the same period last year.
"While the moves make bottom-line sense for card issuers, they don't make it any easier for cardholders," Schulz said. "The reductions and closures come at the worst possible time."
Total credit card debt is about $1.1 trillion nationwide and has been growing steadily since 2015, Federal Reserve data show. That debt was already crushing many U.S. households before the novel coronavirus struck America, according to CBS News Senior Business Analyst Jill Schlesinger.
In fact, payment delinquencies were at a seven-year high just before the pandemic, Schlesinger said. "Many of these credit card accounts won't will not be able to get paid in-full for a very long time," she said.
(Excerpt) Read more at cbsnews.com ...
Our Shell Fleet account cut our limit by 2/3. (Now Wex Bank) It was a ridiculously high limit anyway. We only put about $2,500 per month on it and had a $28,000 limit. We use Visa credit cards for most of our fuel purchases at different stations.
But. It ticked me off. Big time. Screw them.
Just paid off a credit card and we’re burning the damn thing. We now just have 1 with a 3k limit that hardly ever gets used. Good riddance!
This happened in 2009 also.
This will reduce credit scores too.
Was in a store with my sis, today. They declined her card...and I know full well she had a high ceiling.
Gave them another card....and it worked.
I’ve been worried about that.
Time to limit credit card companies to no more than 10% APR(interest). Take difference and apply to principal.
I am stunned. Stunned I tell you. Who could have predicted this?
When you deal with credit card companies you play by their rules. If you don’t understand that up front you’re going to be surprised later on.
While there is a time and a place for everything, and I use credit cards plenty, every time you run that thing through the scanner you are borrowing money. When you borrow money the lender sets the rules.
We haven’t had a credit card since we retired.
We do use a bank issued travel card the we load up for when we do travel.
And that will accomplish...what?
Allow people to pay them off sooner. People with good credit are being charged a lot higher. There used to be usury laws in this country.
This is nothing. Just wait until the FedGov card is denied.
What they maybe did not look into was how many had more than one card issued by different financial outfits.
The best way to screw them is to pay it off each month. Oh, and don’t forget to collect the bennies.
And those CC companies based in DE just love Slow Joe the Demented Fool.
HELOCS can’t be far behind.
People with good credit can always get excellent rates. I’m curious, though...how will people feel when they can’t get credit cards?
What is really interesting about credit cards is that they literally create and destroy “money”.
So, when credit cards reduce credit lines or close cards they are actually reducing the “money supply”.
That is why deflation is possible even when the Federal Reserve is out there creating new “money”.
“The best way to screw them is to pay it off each month. Oh, and don’t forget to collect the bennies.”
Yep. I think the cc companies call us “freeloaders” though they still rake in the merchants’ fees.
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