I don’t use credit cards much. And when I do, I try to pay off what I put on them immediately. But that doesn’t mean I’m not going to get a smack down from the credit card issuer. In fact, my responsible credit card use is more likely to get me a smack down, since credit card issuers aren’t making much off of me.
Anyway, I was a little surprised when one of my credit cards (issued by GE Money Bank) cut my credit line. Especially since I was nowhere near the limit and paying off my charges every month. This is my cash back card. But then I did some digging. See, when we bought our Prius a couple of months ago, we did our financing through the dealer for the special rates. Well, turns out the dealer blasted our information to a bunch of different lenders. (Yes, yes — stupid to get financing through the dealer. But that’s over and done.)
We got our good rate, but that’s not all we got. We got a bunch of inquiries on our credit report. And, even though we ended up with Chase financing, one of the banks that came back with a quote was GE Money Bank. Now, I can’t prove this, but I’m betting that our credit card line decrease came in part because GE Money Bank saw that we were taking out a loan for a car. The other part might have been the 15 point drop in the credit score that we had in the aftermath of car shopping, switching our satellite provider (credit check) and the fiasco with my Bank of America credit card. I fully expect that in 30 more days most of the credit score drop will be recovered.
I’ve tried to reason with the issuer, but to no avail. I was just told — more than once — that certain factors make me a bigger risk. Whatever. Of course, now this is going to ding my credit score even further, since now I have less available credit. Blegh. The other issue is that maybe my other credit cards will cut my credit line as well. Or raise my interest rate. Those new Fed credit card rules can’t come into effect fast enough.
image source: JudeanPeoplesFront via Flickr