I'm posting this separately from the Citi A/A thread because I think this is somewhat important and was not mentioned at all in the other thread.

As of yesterday, 3 out of my 4 Citi cards were closed. No inquiries in 10 months. No new accounts. No new high balances. Current debt (before closures) 63000/130000 (the 130000 is reporting, a Signature card has additional 8000). This 0% debt was accumulated last summer. It was originally roughly 50% of overall balance with several cards close to max and many at $0 balance (Chase lowered many of my CLs last summer but did not close). Citi reviewed one of my cards last November due to inactivity and closed it then but no action against other lines even with high balances.

I spoke with Credit Management today. I was told that high credit limits and $0 balances are a major red flag to them now. The agent admitted that in the past this was a good sign regarding credit. Now she specifically stated this will result in account closure. Furthermore, any activity that will result in a review of one CC will result in a review of all CCS. This appears (from what I know) to be a new behavior and contrary to the conventional wisdom of leaving old credit cards open. I was told that I should pay down debt and remove any unused credit cards in order to have my accounts reinstated.

The rationale according to the agent is that untapped high credit limits indicate the possibility of using them in the future leaving Citi liable for you debt. This is contrary to the previous theory (that she stated was also their theory) that high untapped credit limits indicated you did not need debt.

This has started at Citi and I'm sure it'll spread. I will be paying down CCS as I have high rewards on one of the closed cards (Driver's Edge) and my 0% was about to expire anyway.

I find that hard to believe. I have well over $100k in credit cards limits with Citi, over $100k in overdraft protection lines with Citi, over $1 million in margin credit with Citi, $100k flex select credit lin, a very large HELOC with Citi and a Diners Club card. I applied for PPE card 2 years ago did a 0% BT on the card and never used the card again. It has a $25k limit.

I have never owned 1 penny on my 2 overdraft line of credit or Flex Select credit line as I matter of fact I never used either in over 10 years I have had them opened. I currently owe Citi over $1 million as I am leveraging my Cash Management bonds with my Margin line of credit and I took my full HELOC limit out to buy more Mars and I have a balance of $45k on my Associated Card. Now I think I will be paying back most of the money over the next 2 weeks as rates n Mars have come down to below the rate on my HELOC but my Margin rate is still lower than what Mars are paying.

Banks are being more conservative now then before. Qualified borrowers can not still borrow money. Borrowers who they consider risky or marginal borrowers are having there credit lines reduced or closed. This is nothing new as when ever the economy takes a down turn lenders always take action against marginal or high risk borrowers in an effort to reduce there exposer.

Green for posting your experience and what you were told. While it's just a data point, it's important for those of us playing the game to pay attention to shifts in what credit analysts are telling us.

Having said that, I'm much more inclined to think that your high utilization is what put you on their radar screen. 50% overall utilization and much higher utilization on some individual lines is a clear early warning sign in this environment.

Among other things, that would also better explain why guys like dolmar don't see AA, and why I got approved for a new card this morning despite extremely high levels of available credit (but more like 15-25% showing as utilized).

Probably not great - haven't gotten it in a while. I definitely agree with DaveHanson that the closures are due to the high account balances (not entirely my fault - it was initially under 50% but with Chase dropping CLs it went over). However, I offered to pay off all those balances and the agent said that might not be enough and stated what I said in the OP. That's why I got worried and posted this message.

Edit to add: the only negative factors are the high balances. No lates, negatives, etc... Oldest account (one of the ones just closed was 6 years old)

dolmar said:I find that hard to believe. I have well over $100k in credit cards limits with Citi, over $100k in overdraft protection lines with Citi, over $1 million in margin credit with Citi, $100k flex select credit lin, a very large HELOC with Citi and a Diners Club card. I applied for PPE card 2 years ago did a 0% BT on the card and never used the card again. It has a $25k limit.
You're completely missing the point here.

First, just because they haven't gotten to you, dosn't mean they won't. Citi has millions of accounts.

Second, unless you have an annual income, as well as sepending habits to support that kind of credit exposure, I can almost guarantee you that you'll see those lines massively cut in the near future.

This is the down wave of a credit cycle. You built those credit lines during the loosest credit cycle in American history. Lenders were handing out money like Pez candy, to anyone who asked for it.

During more normal times, unsecured lines in excess of your annual income are atypical. The credit lines you claim to have, are absurd, and no responsible lender will allow that kind of unsecured and unneded exposure as we go deeper into the credit tightening period of this cycle.

i wouldn't be surprised if this will become a trend by the banks to reduce their exposures. People need to realize that we are in a new credit environment. Banks are seeking all sorts of ways to reduce their risk and reducing unsecured lines of credit is one of them,

I know several people who recently received letters from BofA to convert their credit card balances into installment loans. The banks are in a mode of rebuilding themselves so I would suggest that we all do the same too while being prudent about the process.

FWIW, I believe that long ago high levels of available credit did negatively impact credit scores. In the early 90s my job involved reviewing 50-100 credit applications per week for small businesses, so we were generally working with the personal information for the owners. The scores were not a major factor for us, but we were given some general information about how they were determined. Our credit manager also considered available credit in our "manual" review process.

This practice stuck with me too long - just a couple of years ago I closed a lot of unused credit accounts and saw a big tumble in fico scores for my wife & I - from about 800 to 750.

I agree dblevitan is just presenting one data point, it may be specific to Citi or even more specifically to his circumstances. But I think it's not a farfetched idea.

taxmantoo said:IYHTA, Dolmar is probably FWF's number one personal spender on credit cards. (yes, there are a people who spend a lot more, for business purposes) As long as he has substantial assets on deposit in banking and brokerage accounts, spends up a storm, and pays his bills, I don't expect him to experience AA.
I think the ones who have to worry are like me, spending less than $1000 most months, and holding cards with credit lines equal to two years' total credit card spending.

I personally do not spend a lot. I do run a lot of business charges via my personal cards tho.

Do you live in one of the big sub-prime trouble states? They seem to be targeting people in those states. (Fla, CA,etc)

Let me just say that I completely agree with what everyone said why my cards are being targeted. My point in posting this was not to solicit advice on them. It was to present what Citi told me had specifically changed since before.

There's also another thing which seems new - in the past a CC review trigger seemed to be only for one card (i.e. lack of activity as I had last year). Now I was told any review immediately targets all accounts at Citi, thus the reason for the cascading account closures. In fact, I'm still kind of puzzled why my cards got reviewed (and so was the agent). Basically, the chain of events seemed to be something like:

1. One card gets closed for inactivity (it had activity on it within the last year though) and security flagged to ensure I still had it. I actually saw it get closed on Citibank Online (the banking portion) a few days ago, even though they claim it was only closed on 5/1.
2. I call in on 5/1 regarding the security alert posted on citicards.com (never received a phone call alerting me of this).
3. My phone call triggers a review of the remaining accounts.

I asked the agent about this and I think she agreed that something like this happened (but as I said, she was confused as well). I'm personally going to try getting back the rewards on my Driver's Edge card and then once I have a chance to use them, I'm just closing everything at Citi. I'm also planning on sending a letter of protest to their department indicating I plan to drop them completely for what they've done (including all my banking and I've been with them for the last 18 years or so I believe). Between this fiasco, last year's CIS-SSB integration, and lack of good credit cards/interest rates it's just not worth it anymore.

To answer one person's question - I'm in CA right now, so that might be part of it.