Can the bank remove the credit card limit? Find out now!

The surprise of having the limit reduced or even reset to zero makes many people question whether the bank can remove the credit card limit.

Especially if you were counting on the card limit to meet some objective, it is completely understandable that you are dissatisfied with this situation, but is it possible to resolve it?

In today’s content we will understand how granting a limit works, and whether the bank can reduce credit. Continue here and check it out!

Can the bank remove the credit card limit?

You planned to buy that dream television next month with your credit card, but after paying the bill the limit did not return. What happened?

If you search your email inbox, you will likely find a message from the bank related to a partial or total reduction in the limit.

In general, the messages inform the value of the reduction and describe that after payment of the next invoice, the limit value will be updated, which sometimes results in a negative or very low value.

As annoying as this situation may be, it is important to know that yes, the bank can remove the credit card limit, as it is a creditor, therefore, it can choose who it grants credit to and what amount it is willing to offer.

Furthermore, many banks describe in the card usage contract precisely the possibility of the limit being subject to periodic changes, either upwards or downwards.

These changes may occur due to the customer’s profile or even financial variations within the bank itself.

Therefore, if this situation occurred to you, know that it is not illegal or abusive, as long as it is correctly informed to the customer.

++Business credit card: how to choose the best option? – valuedyou.com.

Reasons that lead the bank to remove the credit card limit 

As we saw previously, the bank can remove the credit card limit, as limit variations are provided for in the contract.

But, it’s important to know that this doesn’t happen randomly. Most of the time there is a reason for the partial or total reduction of the limit.

See below 3 of the main reasons:

1. Default 

Granting a credit limit usually takes the customer’s financial profile into account, so having a positive financial life offers better opportunities.

And, even after granting a limit, the bank continues to carry out periodic credit analyses, so changes in the financial profile may result in limit changes.

Therefore, if you contract any debt or experience changes in income, it is likely that your credit card limit will be reduced or even reset for the security of the creditor, which is the bank.

That said, knowing that the bank can remove your credit card limit due to variations in your financial profile, it is crucial that you stay out of debt.

2. Inactivity

Many customers receive a card and do not even unlock it because they do not need the service at the moment. 

So, when they finally try to use it, they are surprised by the limit being zero or drastically reduced. Is this allowed?

Yes, inactivity can lead to limited changes, as banks consider the relationship with the customer when granting credit.

Therefore, if you don’t use your account or haven’t used your card for months, the bank may remove your credit card limit.

3. Changes in income calculation 

Although it is not widely publicized, banks consider a “margin of safety” in the income reported by the customer.

This safety margin is nothing more than a percentage of the customer’s income that can be used to pay credit, without causing harm to their finances.

Therefore, cases of reduced income or even taking out other lines of credit can affect this margin, which brings less security to the creditor.

Therefore, the bank can remove the credit card limit if your income changes, and with that the payment guarantees. reduce.

After the bank removes the credit card limit, is it possible to recover it?

We know that this situation of having the limit changed downwards is very uncomfortable, especially for those who were counting on the card to complete an important objective.

But, if you are wondering if it is possible to recover the lost limit, know that it is possible, although it takes time.

The partial or total reduction of the limit occurs after a negative credit analysis, so, to recover credit, your profile would have to undergo a new analysis, and this time it would have to be positive.

In any case, in principle there is no guarantee with this recovery will occur, when It is what value.

Therefore, the best solution is to try to talk to a representative of the financial institution, in order to understand what caused the limit reduction and what are the procedures to recover it.

In any case, maintaining a positive financial profile and a good relationship with the bank are strategies that can help you be well evaluated in a future opportunity.

Furthermore, you can still try credit opportunities with other financial institutions if your bank insists on keeping credit low or refused.

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