Capital One is the only credit card company that I am aware of that will not disclose your credit limit to the credit bureaus, but they have to disclose what your current credit balance is. So in turn the credit bureaus assume that you are using 100% of your available credit with Capital One.
Yes, I have run into this, but I've read that the credit bureaus use your highest-ever reported balance as a proxy for the credit limit (and my credit report does list a "high balance" on this account). At one point (back in the credit orgy of 2004) they gave me purchase checks with a fixed-for-life 5% rate. I thought it was too good to be true, but the only catch was that all payments went to this 5% loan before any higher-rate regular purchases--so if you didn't use the card for anything else it was a simple 5% loan. I used the 5% deal to finance getting my roof replaced (cheaper than a home-improvement loan or HELOC), so I have carried a relatively high balance on this account in the past. In fact, now that it has been lowered, my actual limit will be
lower than the credit bureaus think it is!
On an aside, I don't believe that I have ever had a credit card company lower my available credit limit. I didn't think they actually did that.
I've never heard of a card company lowering a limit either--at least for someone with good credit (my score is in the 770s). I think I'm more in shock or insulted than actually upset. Maybe Capital One is more free to do it simply because they don't report limits. Or, given the recent credit market problems, maybe they are trying to limit the risk of people suddenly running up the balance on their low-fixed-rate cards. But as benbo points out, there is probably no point in speculating because "There's no rhyme or reason with the credit card company."
But my ex-gf couldn't even get a
secured credit card, so I wouldn't be surprised if they lowered the limit of someone with credit that poor.
My credit cards seem to insist on pushing my credit limit beyond my annual income. Seems a bit ludicrous to me, but if the doctor ever tells me I have only 2 weeks to live I 100% guarantee I'll be throwing one hell of a party.
Don't forget to invite us for the party!
The other group of people I really despise are the mortgage/lending institutions that are constantly trying to peddle 'products' that DO NOT help your financial situation. I have found the tactics predatory AT BEST.
I completely agree. Radio ads have a guy from Mortgage Company X saying he saves people money every day by refinancing. Like he's helping them out. Right. What he really means is he lowers their payments, not that he saves them money. I'd be willing to bet he is extending their loan term by so long that their interest payments shoot way up and they pay much
more in the long run.
It turns out that my FICO score is in the mid 700s and I guess that actually is considered GOOD. How they figure my credit is 'good' is beyond me .... :dunno:
Others here know more about this, but from what I can tell, payment history is the biggest part of your credit score. As long as you don't show any signs of being stretched (especially late or missed payments, or suddenly applying for lots of credit), your score will be relatively good regardless of the amount of credit you have or how much you are using. Running your cards up does ding you some, but not a huge amount. When I opened a new auto loan (72 months at 0% :woot: ), my score only went down by about 4 to 6 points.
