Disclaimer: I am not a lawyer. I am
only publishing my interpretation of my situation. You should seek your
own legal representation for your own particular
situation. Do not rely on my
opinions or statements for your own purposes as state
and local law varies as do individual circumstances.
While my credit score has steadily been going lower and
lower due to my outstanding mortgage payments and foreclosures,
my credit card limit has been doing the same thing. American
Express has just lowered my credit limit a second time. The
first time American Express lowered the credit limit on my
credit card was back in October or so of last year. That was a
substantial reduction. They reduced my credit limit to less than
half of what it used to be. Of course, it was still enough for
my monthly expenses; and I pay it off every month anyway. This
latest reduction reduces the limit almost in half again (they
are making pretty hefty cuts on my charging).
The email notification
came this morning. It was very nice and very professional. It
stated that my current balance was two hundred dollars
($200.00) over the new reduced credit card limit so all future
charges would be declined until the balance was reduced to less
than the current available credit limit. No over-limit
fees would be charged to my account as a result of this credit
reduction. Also, my annual percentage rate would not increase as
a result of this credit reduction (I always pay the balance in
full each month so I never get charged finance charges anyway).
What will I do about
this? Will I send them a hateful email response? Will I try to
defend my payment history to them? Will I try to explain my
credit score?
I will do none of these
things. Those would be a waste of my time and energy. I will pay
my American Express account balance in full before the due date.
I will be thankful that I even still have an account with
American Express; and I will start using my debit card on my
checking account and carrying more cash in my wallet. The reason
I will start using my debit card and cash more is because I can
no longer rely on my credit card with American Express. American
Express has now gotten in the habit of regularly reviewing and
reducing my credit limit
(although American Express has not told me how often or when
or how they will be reviewing my credit limit) and only
notifying me after they have changed my account limit. If I am
out for lunch with friends and/or family, I have no way of
knowing what my available credit is without calling American
Express at the time of the charge (or trying the card). Even if
I check my available credit limit on the Internet before I leave
the house in the morning, American Express could change my
available credit limit in the middle of the day at any time,
even cancel my card (which is apparently the direction in which
they are heading). No, there is too much uncertainty in this
situation. I am going to resort to debit and cash except for
situations where a declined credit card is less likely to be
embarrassing such as paying at the pump for gas or buying things
on the Internet.
It is unfortunate. My
switch to Visa debit and cash for payment will take money away
from American Express. Every time I buy something with my
American Express card, American Express gets a percentage of the
purchase as a processing fee from the merchant. Poor American
Express is just hurting us both which will, of course, trickle
down to the rest of the ailing economy (this is the vicious
cycle deal).
For all of the talk about
easing the credit markets, the government is obviously not doing
things that will easy my credit market.
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