In todays market you don't have to do anything wrong to get a bad credit score or to have credit card companies lower your limits or cancel your cards.But most likely there was one thing in your credit report that got the ball rolling and from here on out it will be a landslide on your credit reports.
For example:
One customer of mine had score in the mid 700's, no late payments or any negative information. 2 months ago she purchased a new home theater setup for close to $3000, her credit limit was $8000. Because the entire purchase went thru one retailer, they popped up that same day and lowered her credit limit to $3000. So now it looks like she is using 100% of that cards credit. A few days later her AMEX card did a soft pull out of the blue and found that she was using 100% on discover. Being jumpy already, they dropped her credit limit on all her accounts to whatever the balance was or $1000 if she had no balance.
Over the next couple of weeks other cards started doing the same thing. She went from having 130K in credit lines with a balance of 15K, down to 16K in credit lines with a 15K balance. Her credit score on experian went from 730 down to 598. Experian was the one reporting company that updated everything weekly and sometimes daily, its also the company that got the whole wagon rolling. Equifax has some of the lowered credit lines showing up but it still shows her available credit in the 75K range.Her score with experian is in the 650's. and her Transunion score is at 720. Only thing showing up on there is the discover card at 100% usage. The other cards actions haven't been reported to them yet.
Whats sad is she has had a long and healthy history with all of her creditors. No negative information at all in any of her credit reports, but still her scores are as bad as if she was a deadbeat.

Credit card companies are terrified right now and in their haste are jumping the gun on people. But in trying to protect their assets they are making the entire credit situation worse.

I have seen several of my customers credit reports take hits because of actions by the card issuers.
some are even getting daily soft pulls from citi and AMEX, for no apparent reason.
Whats going on in the credit world is odd, to say the least.

I don't doubt what the OP isn't true, but one person's experience I wouldn't expect to happen to everyone. I myself probably have about $200,000 of credit available on my bankcards, while owing only $1,000. My only other bigger debt is my mortgage. I have four Citibank issued credit cards. Two are over 20 years old, and the other two are about five and ten years old. Never past due on any of my accounts. I'm not worried (my FICO has been 800+ for years). But maybe people who are thinking of starting a AOR, or opening up more accounts with no real use for them, should think twice before doing that, especially if their credit files aren't old/extensive. I think it's best to remain under the radar now, until this nation starts to get out of this whole credit mess we're in.

This could be based on geography as one poster said

From the stories on CNN, it is quite plausible that people with such huge limits can start paying their mortgage payments by doing a balance transfer

They could buy 5000 in grocery store gift cards,5000 in gas cards and just not repay the credit cards. That would scare the hell out of any lender

dolmar said:lp244 said:dolmar said:If you have a "Margin line of credit for $1 Million" for example you have to have a minimum of $2 million in assets with Citi as they only allow you to margin up to 50%.

Wouldn't a 50% margin limit and assets of $2 million give you a $2 million margin line of credit?

Phrased differently: With $2 million in equity, and an initial margin requirement of 50%, one can buy $2 million of marginable securities.

Well either I am explaining it wrong or you are misunderstanding me.

Citi has a product called "Margin Line of Credit" it works like a HELOC. You can draw against it up to 50% of the value of your portfolio. You can just take the cash and do whatever the hell you want with it and are not required to buy more securities with it. So if your portfolio is worth $2 million you can borrow against it $1 million. Sure if you buy more securities then you could borrow more as you would be under the 50% level of your portfolio. But if draw against that "Margin Line of Credit" and use the money to pay for other things then your portfolio size did not increase thus you would still only be allowed to borrow up to 50% max.

The product "Margin Line of Credit" is different than margining securities to buy more securities as Citi calls that your "Margin Buying Power".

Just out of curiosity, what kind of interest rate does Citi charge on this Margin Line of Credit?

vaylon said:In todays market you don't have to do anything wrong to get a bad credit score or to have credit card companies lower your limits or cancel your cards.But most likely there was one thing in your credit report that got the ball rolling and from here on out it will be a landslide on your credit reports.
For example:
One customer of mine had score in the mid 700's, no late payments or any negative information. 2 months ago she purchased a new home theater setup for close to $3000, her credit limit was $8000. Because the entire purchase went thru one retailer, they popped up that same day and lowered her credit limit to $3000. So now it looks like she is using 100% of that cards credit. A few days later her AMEX card did a soft pull out of the blue and found that she was using 100% on discover. Being jumpy already, they dropped her credit limit on all her accounts to whatever the balance was or $1000 if she had no balance.
Over the next couple of weeks other cards started doing the same thing. She went from having 130K in credit lines with a balance of 15K, down to 16K in credit lines with a 15K balance. Her credit score on experian went from 730 down to 598. Experian was the one reporting company that updated everything weekly and sometimes daily, its also the company that got the whole wagon rolling. Equifax has some of the lowered credit lines showing up but it still shows her available credit in the 75K range.Her score with experian is in the 650's. and her Transunion score is at 720. Only thing showing up on there is the discover card at 100% usage. The other cards actions haven't been reported to them yet.
Whats sad is she has had a long and healthy history with all of her creditors. No negative information at all in any of her credit reports, but still her scores are as bad as if she was a deadbeat.

Credit card companies are terrified right now and in their haste are jumping the gun on people. But in trying to protect their assets they are making the entire credit situation worse.

I have seen several of my customers credit reports take hits because of actions by the card issuers.
some are even getting daily soft pulls from citi and AMEX, for no apparent reason.
Whats going on in the credit world is odd, to say the least.

I don't believe 1 word of this.

My Brother has a few 30, 60, 90 day lates on a few accounts, I keep telling him how SHOCKED I am that AMEX and the others haven't lowered his limits. His EQ and TU are under 600 and his Experian is 620ish.

Some A/A is random and they give you a BOGUS excuse for it.

CITI has givin me 6 new accounts in the last 5 months and the 5th account they EMAILED me and asked me to apply for it.

Don't listen to ANY of the nonesence, if you get A/A SO WHAT just apply for 20 more accounts and forget about it.

It would be stupid to live your life according to the A/A rules!!!!

Re: OP post: Part of the story was also that they were concerned about FICO and credit.

I can personally vouch that "too much available credit" is indeed a sign of credit risk for Citi these days. (See my story in the "Severe Adverse from Citi" thread.) However, I wouldn't go around chopping cards and limits just to avoid A/A from Citi. I seriously doubt that Citi is (automatically) monitoring accounts for too much available credit. But, if something else gets their attention, lots of unused credit will provide a convenient reason for the Credit Management department to cut you off.

What initially gets their attention? The usual suspects - lots of new accounts, inquiries (some have said 5+), and/or debt. For those thinking "I'll just keep my FICO high and remain untouched," not so fast- it's not quite the simple. In my case, my EQ FICO was at 775, but Citi took exception to my heavy activity on the CashReturns card.

This is not a "Sky is falling message," but the game has definitely changed. Be aware and do your own risk/reward analysis.

I think you missed the point of my previous post. Some other traditionally-frowned-upon activity will trigger a manual review, and "too much available credit" can provide an excuse for the resulting adverse action.

I seriously doubt "too much available credit" by itself will trigger anything. At least not yet.

Very useful post dblevitan, green for you. Thanks for all the details.
dblevitan said: she made references to Citi looking more closely at HELs and treating them more as credit card balances (revolving debt) than secured debt versus past treatment as secured debt (she blamed this on the poor economy and state of mortgages).I assume you mean HELOC (equity line of credit that revolves), not HEL (equity installment loan, like a second mortgage)? Or did she actually lump them together?

Citi can go screw themselves. They did me good. I had 22K on one card with them and 4K on another - both 0% for life cards. After I co-signed on a college tuition loan for my daughter (supplied by Citi) they did account reviews on my two accounts. Their decision? I was now a bad credit risk. They upped my 0% to 3o somethin percent interest and payments went from $212 to $700 on the card with the large balance. I could NOT afford that but tried. Was late a time or two and then other cards followed suit. Forward to today: ~~~~~> Citi is ready to sue me for payment unless I pay then 5K down and $750 a month on one card. I have since lost a large portion of income. I have not paid anyone other than necessities for the past 6 months or more. BK is looming.......