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Nearly 50 million Americans just had their credit card limits cut
CBS News ^ | May 4, 2020 / 1:30 PM | Khristopher J. Brooks

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 ...


TOPICS: Business/Economy
KEYWORDS: bankruptcy; credit; creditscores; debt; economy
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1 posted on 05/05/2020 5:37:56 PM PDT by fluorescence
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To: fluorescence

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.


2 posted on 05/05/2020 5:40:35 PM PDT by No Socialist
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To: fluorescence

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!


3 posted on 05/05/2020 5:44:44 PM PDT by Impala64ssa (Virtue signalling is no virtue)
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To: fluorescence

This happened in 2009 also.


4 posted on 05/05/2020 5:44:47 PM PDT by CodeToad (Arm Up! They Have!)
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To: fluorescence

This will reduce credit scores too.


5 posted on 05/05/2020 5:49:24 PM PDT by Raycpa
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To: fluorescence

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.


6 posted on 05/05/2020 5:51:30 PM PDT by RushIsMyTeddyBear ("Progressives" (elitist Communists) "Love you to death".)
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To: Raycpa

I’ve been worried about that.


7 posted on 05/05/2020 5:52:14 PM PDT by RushIsMyTeddyBear ("Progressives" (elitist Communists) "Love you to death".)
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To: fluorescence

Time to limit credit card companies to no more than 10% APR(interest). Take difference and apply to principal.


8 posted on 05/05/2020 5:52:38 PM PDT by JoeRender
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To: fluorescence

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.


9 posted on 05/05/2020 5:56:19 PM PDT by ChildOfThe60s (If you can remember the 60s........you weren't really there)
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To: fluorescence

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.


10 posted on 05/05/2020 5:57:47 PM PDT by MrHead (i know my soul is lost to me.)
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To: JoeRender
Time to limit credit card companies to no more than 10% APR(interest).

And that will accomplish...what?

11 posted on 05/05/2020 5:58:24 PM PDT by gogeo (It isn't just time to open America up again: It's time to be America again.)
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To: gogeo

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.


12 posted on 05/05/2020 6:00:58 PM PDT by JoeRender
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To: fluorescence

This is nothing. Just wait until the FedGov card is denied.


13 posted on 05/05/2020 6:04:28 PM PDT by shanover (...To disarm the people is the best and most effectual way to enslave them.-S.Adams)
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To: fluorescence

What they maybe did not look into was how many had more than one card issued by different financial outfits.


14 posted on 05/05/2020 6:08:47 PM PDT by Wuli
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To: No Socialist

The best way to screw them is to pay it off each month. Oh, and don’t forget to collect the bennies.


15 posted on 05/05/2020 6:28:23 PM PDT by dhs12345
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To: fluorescence

And those CC companies based in DE just love Slow Joe the Demented Fool.


16 posted on 05/05/2020 6:28:58 PM PDT by Thumper1960 (Trump-2020)
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To: fluorescence

HELOCS can’t be far behind.


17 posted on 05/05/2020 6:44:46 PM PDT by ameribbean expat (Attention! All persons having the corona virus...please report to the nearest IRS office. Thank you.)
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To: JoeRender

People with good credit can always get excellent rates. I’m curious, though...how will people feel when they can’t get credit cards?


18 posted on 05/05/2020 7:30:30 PM PDT by gogeo (It isn't just time to open America up again: It's time to be America again.)
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To: gogeo

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”.


19 posted on 05/05/2020 7:52:09 PM PDT by cgbg (New poll: post elderly voters like Biden's experience as Wilson's VP fighting the Spanish Flu.)
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To: dhs12345

“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.


20 posted on 05/06/2020 12:39:36 AM PDT by LateBoomer
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