You just got notification that your Credit Card Company is going to reduce your credit limit. What should you do? You have several options but you first should think about what might have caused the reduction in the first place.

Have you made any payments late? Creditors will often look at the payment history to determine what type of risk you are. If you have made some late payments, then you become a higher risk to the Credit Card Company. To protect themselves from further risk, they might lower your limit to protect their liability. This might be the time to call your credit and ask why they reduced your credit limit. If you have made several late payments, then chances are you will have to prove yourself again to the Credit Card Company so that they will consider raising your credit limit. Your credit score will be lowered because of the reduction in your credit limit. Until you resolve the problem with your late payments so that you can make them all on time, you may have to live with the reduction.

Now if you have not used the credit for quite a while, that may be another reason for a reduction. Some Credit Card Companies determine that if you are not using their offer of credit, then you don’t need it. They will reduce your limit because they feel that their money could be used elsewhere to make some profit. Look at your last statement and see if you charged anything on that credit card. If you see that you did not charge anything, then ask yourself why? Does this Credit card company charge too much in interest? Why are you not using the card? Then try to fix that with the credit card company. Ask for a reduction in interest so that you will use the card more, then ask they to change the credit card limit back to the original limit.

If you get those things figured out then you can work with your credit card company to fix the problem and get your credit limit back to its original limit. Maybe you can get the credit card company to raise your limit. That will help your credit score if you don’t immediately go out and use all of it up. Remember to keep your credit balance around 30% of your Credit Limit Balance. Then pay all of your bills on time and in full. Those positive steps will really help your credit score.

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