Reader James writes in with a story we hear a lot lately. During the run up to the credit meltdown –Bank of America kept raising James’ limit. He ran up a balance while caring for someone who eventually died — and now that he has paid off his debt, his limit has been cut. In the long run, however, he feels that he’s better off without credit cards.
Has your credit limit been inexplicably lowered lately? Well, it might not be anything personal. The problem might be with your mortgage lender. Or where you’ve been shopping. Or where you live. American Express, long rumored to judge customers based on this criteria, has admitted that it evaluates who you do business with and where you live when determining how much credit to give you, says MSNBC.
Reader Pierre is a small business owner who has an American Express Business Account that used to have a $25,000 limit, but has now been cut to $1,800. He says his company’s bill is usually around $12,000 a month, and it is always paid in full — on time. While Pierre is clearly upset with American Express, the Wall Street Journal says that all banks are cutting access to credit.
Chase likes to raise the rates of cardholders whose only fault is properly using their credit card, according to an ABC 15 investigation. The rate hikes affect cardholders who do not exceed their credit limits or miss payments, with some APRs jumping from 7.99% to over 22%. From ABC 15: