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American Express / american express reduced credit line and damaged my credit

1 United States Review updated:
Contact information:

I am a small business owner and I am extremely particular about my credit. With a lot of hard work, years in the making, my credit score was nearly perfect.

Because of the flexibility of the American Express Platinum card and it’s advertised “no preset spending limit”. This is advertised on all of there web sites, TV and print advertising.

(COPIED FROM THEIR WEB SITE)
• Airport Club Access
• Exclusive amenities at boutique, resort, and luxury hotels
• Platinum Travel Service
• No pre-set spending limit
• The Membership Rewards First® program
• Platinum Card Concierge Service
• By Invitation Only® Events



I applied for and received this card and paid a very high annual fee ($450.00 PLUS $250 for each additional card holder) for this privilege so that I could use it for larger purchases.

Later, because we are launching a new business I also ordered anther American Express revolving card and a line of credit account. All accounts were solely based on personal credit and I was told that up front.

American Express extended numerous solicitations on the platinum card to pay some of my purchases over time. You were instructed to request to pay over time and then they would take several days to approve. In order to help finance my new business, I also took advantage of that offer.

I paid fully and on time according to the terms of my agreement. I never made a payment late. I had only used a percentage of the credit available to me on the line of credit and the revolving card as they came with a preset limit that I was given in writing.

I purposely kept my spending below the max available so that it would not adversely effect my credit score.

Bait and switch ... I was shocked when my Platinum card was declined for a small purchase. I contacted American Express and was told that they had decided to give me a “credit limit” that was less than my current balance on the card and that I was over their newly imposed limit. They gave me no reason for doing this and gave me no advance notification.

I had recently written a check from the line of credit to cover some other purchases. I had checked the available credit prior to doing this and it was sufficient to cover the check. Several weeks later I received letters in the mail saying they had reduced my limit on my revolving card and my line of credit account.

I called and asked if the check would be honored as I had written it prior to them reducing my limit. They refused to honor it and returned the check. (costing me fees)
Their reason? Because I didn't have a Dunn & Bradstreet number. I've requested a number from Dunn & Bradstreet and have never received one. Yet remember that my line of credit was secured off of my personal credit, not my business credit worthiness.

This matter has had a severely negative impact on my credit score. By reducing the credit limits, it looks as though I was maxed out on my available credit which causes your score to drop dramatically. Not only has it limited my credit line with American Express buy has caused me to be declined by others because of the negative impact on my credit.

Not only is this False and deceptive advertising and “bait and switch”, This is an unethical practice and I feel American Express should be made to honor their agreements. Especially with regard to the fact that they charge exorbitant membership fees for the “privilege” and then renege on the original offers.

I would like my original terms restored immediately and the information corrected with all credit bureaus.


Thank You for your assistance in this matter.

La
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Comments

  • Sj
      13th of Jul, 2008
    0 Votes

    Hey buddy, they did the same to me. Got two accounts for years with below 50% balance. Got the credit line reduced on both cards and put me at 95% (at least I wasn't above 100%!). Never late, not a spot on my credit history. I only used them few years ago to get some good deal with 1.9% APR and ever since I was paying only minimum payment.

  • Ns
      15th of Jul, 2008
    0 Votes

    I just had the same thing happen to me this week. I have never been late and have been an American Express Memeber since 1998. Last week I paid down $1000 of my ballance and recently charged some business expenses since then. I just found out today after getting a few calls from vendors that my card had been declined. I called American Express and they informed me that they reduced my credit limit. So with even me explaining that I have never been late and being a long loyal satisfied customer they still were unwilling to help me with the probelem they caused. I have never recieved any noice of e-mail, phone call or letter to this day of this.

  • To
      9th of Aug, 2008
    0 Votes

    This just happen to me today. I have always paid by bills and I've had balances from 1k to 10 per month. Today they put a limit on me for 3k, my balance was already 5 k. I never hated them. I think it is false advertising. They told me that because of the economy they have to do this now. There really should be a law suit for the false advertising. They should pay for their actions. If there is a class action suit, I would like to join.

  • Me
      16th of Aug, 2008
    0 Votes

    My experience is quite similar; after 23 years of high usage and full, on-time payment each month.

    Your credit score is affected when an institution reduces your limit as it indicates an unfavorable change in your financial standing.

    I am truly disappointed in American Express as it was the only card I used and convinced my friends, relatives and Employment Company that it was the best card, hands down, with no preset spending limit. I now know differently and will like others to know that Amex will easily destroy you in return for your loyalty.
    The only reason they gave was that the amount for the month was higher than past monthly amounts (which was not the case), so, I have to pay the amount in order to continue using the card.

    It is obvious Amex will pay heavily for their rogue actions later, but many trustworthy individuals could be pushed into rebellion against the system before such time. This is very sad …it seems no one can do anything about it.

  • On
      26th of Aug, 2008
    0 Votes

    Amy, I've been a cardmember for 23 years and they pulled the same nonsense on me. I've stopped using amex entirely and suggest EVERYONE do the same. Hurt them in the pocketbook. They're penalizing their loyal customers for their poor business decisions and they have to realize there is a consequence for their actions.

  • Yv
      28th of Aug, 2008
    0 Votes

    Yes this just happened to me today ! no warning no call just closed my account. Always paid on time and AMEX can give me no reason other than they said their credit department made the decision and I can speak to nobody in that dept. I agree all should BOYCOTT AMEX
    Terrible company to do business with !!! They deserve NO business

  • Gu
      26th of Sep, 2008
    0 Votes

    SAME THING HAPPENED TO MY BOYFRIEND WITH THE CREDIT LINE ISSUE.

    I HAVE A GOLD CARD THAT I HAVE HAD FOR 17 YEARS, JUST TRIED TO MAKE A PURCHASE FOR $400 AND WAS DECLINED - BECAUSE I HAVEN'T BEEN CHARGING ENOUGH IN THE PAST 6 MONTHS!!! WELL EXCUSE ME FOR BEING CONSCIENTIOUS ABOUT MY MONEY AND HOW I CHARGE. JUST INFORMED THEM I WILL NO LONGER USE THEIR CARD. WELLS FARGO AND B OF A HAS BEEN MUCH BETTER.

    AMERICAN EXPRESS IS HARMING ALOT OF PEOPLE THIS WAY. I'D LIKE TO SEE A CLASS ACTION SUIT IF POSSIBLE BROUGHT AGAINST THEM.

  • Mi
      3rd of Oct, 2008
    0 Votes

    I cannot believe the same thing has happened to me. I three cards with amex: Platinum Personal, Platinum Business and a blue card. I have had them for four years. Never late on any of them. Always paid what was due. Today, I went to make a $200 online purchase for my business and the charge was declined. I called Amex and they told me that they reduced my my credit to $4, 500. The card I was using had a $15, 700 limit and I had $4, 000 on it, with nothing late. Amex said it was because of my Experian credit score. I have always had a 760 or higher score, so I was very surprised. I called Experian and was told my score was 789!! They then went on to tell me that I have a better credit score than 94% of the population. What is going on? I cannot get a straight answer out of Amex.

    I appreciate any insight.

  • Mi
      6th of Oct, 2008
    0 Votes

    I had this the same thing happen to me as well. Normally I would understand given the credit crisis, but Amex has handled this situation very poorly!

    1. I received a letter of notification several days after I had already been declined due to my credit limit being cut without my knowledge.

    2. When called for an explanation they blamed my credit score. (I subscribe to creditsecure with Amex and keep an eye on my credit score, it has only gone up NOT down). I tried not to get mad at the customer rep but they were very rude.

    3. American Express has recently implemented a new policy with reward points (allowing you to borrow points to make purchases). Prior to this you could simply pay the different up front. In looking at the terms it is clear that the penalty for not earning the points far exceeds the value of the items.

    American Express is clearly taking a turn for the worse and I will be boycotting them!

  • Ry
      9th of Oct, 2008
    0 Votes

    I too have had a reduction in my limit putting me to %100! I have never had a late payment on anything in my life. I will be 29 in Feb., is this age discrimination? How old are all of you?

  • Vi
      9th of Oct, 2008
    0 Votes

    I haven't had my limit reduced yet, but I am purposely keeping it nearly maxed while I pay off other credit cards (they offered me a great lifetime APR on balance transfers). I typically pay more than the minimum, but just enough to make it look good. I was recently denied a credit limit increase due to a low credit score. My score was actually lower when I received the card and has gone up since that time. Based on reading this and other complaints, I am confident they will reduce my limit when I pay it off and this would really destroy my credit score. Their measly 2000 limit is keeping my utilization in the 70% range. Not great, but any higher and my score would tank. Once I am no longer worried about my utilization, I will pay them off and if they decrease my limit, their card will collect a lot of dust.

  • Al
      9th of Oct, 2008
    0 Votes

    I am so mad at American Express!! The same thing happened to me last night when I tried to purchase airline tickets. My card was denied and thank goodness it was an online purchase so it wasn't that embarrassing. I have never been late and have always paid my balance every month and still they managed to put me on a "spending limit" without prior notification. When I called American Express all they can say was the new limit they just imposed on my account was based on my usual spending habits and the current state of the economy. The new limit they imposed on me is lower than my usual spending habits! I don't think that I should be punished as an individual for the actions of greedy CEO's of big financial firms extending loans to almost everyone. Their actions have propelled us to an economic downward spiral. I was smart and did not buy a house I knew that could not pay for, especially get a sub prime loan, I have been a loyal customer and have done nothing to American express to lead them to believe that I am financially incapable of paying my bill. This situation AmEx has put me in, has led be to realize that they just plain out suck as a company. I definitely feel that there is no sense of certainty that a charge on your AmEx would be approved or declined, since they can apparently impose a limit on our purchasing power when ever they desire without having to justify their actions. I believe that my annual payment, my loyalty, my history of credit reliability with AmEx means nothing to them. I refuse to do any further business with them. I have since then closed my account.

  • Pe
      16th of Oct, 2008
    0 Votes

    Apologies in advance for the long story. I've had an Amex Blue without issue for about four or five years and have been quite tight with my use of it never going over 50% of the credit limit and usually paying it off in full within one to two months.
    I was initially approved with somewhere around an $8K limit, then it bumped up over the years to $11K, then $16K, then somewhere over $20K, and finally earlier this year to $35K.

    So, let's begin the "fun"- Here's a little timeline of events:

    1. September 16th 2008 closing date statement:
    $35, 000 credit line. $2030 purchase made this month.
    This is the only purchase I've made on the card all year.
    Made a minimum payment, with the intent to pay off two equal chunks, or one full chunk, by the next statement. I consider myself pretty aware of credit scores and rules, so I figured the month of usage might help keep my card looking active, as I was thinking of beginning to use it a little more over the holidays for rewards points purposes. I saw a news piece a couple of weeks ago talking about credit card companies and the economic crisis going on right now, and how AMEX specifically was planning on decreasing limits on some percentage of its users.

    2. Around October 7th, 2008:
    I receive three balance transfer checks from AMEX blue in the mail. First time that I've ever received them over the life of my card membership.

    3. October 8th, 2008 - (Wednesday):
    I write one check to WaMu mastercard to pay off a balance of $2000.
    I write another check for $1900 to pay off a citibank card that does not have online payment access.
    Both go in the mail.

    Just to clarify: at this point, I figured I am just using these checks to show some usage of them, in order to keep myself looking active as a blue card user.

    I was about to zero out my balance on Amex Blue, and transfer $3900 to it. Then pay THAT balance off in the next cycle. I always figure if i have these cards and the cash to pay them off, why not get their free perks and usual purchase return protection, etc, rather than using cash directly. Hopefully at this point you can sense where this story is heading and the amount of frustration I about to experience.

    You'll also see why the dates, and days, are keeping this making some sense.

    4. October 14, 2008. Tuesday:
    I check my WaMU mastercard account and see that they quite quickly received the Amex Blue transfer check and posted the payment of $2000. I don't give it any further thought. All seems fine. I don't bother to check the citibank card.

    5. October 15, 2008, yesterday.
    I realize my blue card's closing date is coming up. I decide to log on, and squeeze in a big payment before the closing date so that my statement has no payment due, and I wanted to make sure it was substantially more than the minimum.
    To my dismay, I do not see my credit availability as "$32, 970" but it is INSTEAD $170.
    That would mean that my card went from a $35000 limit with a $2000 balance down to a $2200 limit with a $2030 balance.

    At this point, I'm confused. I check my WaMu account again and it's fine, still shows a posted payment of $2000. I hurry and check the citibank card account, and see that the Amex Blue check for $1900 that i sent in has been received and had bounced on 10/14 (Tuesday). But this doesn't explain the check sent to WaMu that they posted as a payment. That would mean that my limit is $2200 but my balance is now $4030... !?!?

    I call AMEX. The customer support person can't really help, and forwards me to the credit line department. I am on hold for 30 minutes and eventually hang up.

    (by the way thanks for keeping up with me this long)

    6. October 16, 2008, today:
    Call AMEX credit department again at 9 am. They explain that on October 13th, 2008 (Monday), my card was "evaluated" and the credit line was dropped. They apparently sent out a letter that day too- but as of yesterday, I still hadn't received it. They have no ability to explain their messup in sending out Balance transfer checks then creating a situation where they'd bounce!
    I asked about my payment to WaMu using a check that appears to have been processed just fine- except it's not showing on my Amex Blue online statement. The customer service person tells me "it's going to be denied"...!
    At that point, I asked to speak to a supervisor, and the wait time was so long that I had to leave my number and am now at 1pm EST still waiting for a call back.

    ISN'T THIS A BIG PAIN?

    Some thoughts- Might be assuming here, but AMEX's credit line department must be getting A LOT of calls like this right now, hence the news report i mentioned earlier and the extreme wait times.

    My fears now:
    -I am going to get hit with a return payment on my WaMu card if that amex check bounces. As of today, 10/16, it still looks fine when i check the WaMU statement online. I don't even carry the WaMu card, so I can't even call them right now.
    -My AMEX blue statement closing date is today, 10/16. When Amex reports to FICO, I will suddenly have a $2200 balance that for all appearances is maxed out with a $2030 credit line. This is a situation I've avoided my entire credit life.

    I'm waiting for the supervisor callback until about 2pm, and am trying to find out if I can make a phone payment that would post TODAY, prior to the statement being generated. Otherwise, I can pay online but it won't post in time to make the statement (it needs 24-72 hours, I would have paid yesterday, but I thought there was something much worse going on with the account, until i googled and found many articles such as this one).

    To add insult to injury:
    I have an AMEX platinum and gold. My wife and i use those quite regularly, basically as cash. Amex has begun offering a credit portion on those (in other words, you don't have to pay it all off at once if you don't want), and JUST NOW, in late september, enticed us to turn this feature on with a rate that was lower than our AMEX blue card! Don't think I'd ever really use this feature, but figured it's always good to have a backup. Each month they automatically put anything over $100 into that portion of your credit/charge list.
    Easy way for them to make money, i guess.

    So, now I'm just frustrated. $35K limit down to $2K. Overnight.
    NO notice- except for the letter I'll probably get in the mail today. And, all of it done WHILE other institutions are trying to cash the amex balance transfer checks!!

    BLAH!

  • Ll
      18th of Oct, 2008
    0 Votes

    I just got a notice today via email that they cut my available balance down to about 300 dollars over what my carried balance is at. So I am sure it looks great on my credit that I am almost at a 100%. I am only 29 with excellent credit and AMEX is deciding to hurt tons of small business owners and regular folks because they decide to loan money unwisely and are suffering a credit crisis. I am not sure how much it will affect my score but I think it will hurt them more in the long run. This is about the time that I will do a 0% APR transfer to BofA or Wells Fargo. It is poor business practice and I hope there is a class action lawsuit. There is a term for this 'Indian Giver' and I am native american so I am allowed to say this they should be ashamed.

  • Pe
      18th of Oct, 2008
    0 Votes

    I was also posting this on another page- http://www.totalnoid.com/2008/06/10/un-american-express-targeting-profiles-to-decrease-credit-lines/#comment-3383

    So in one piece of good news, my online payment attempt of $1000 was actually posted JUST in time and at least my statement now will show a $1030 balance on a card with a $2200 limit- I’m no longer in fear of how my FICO is affected.

    I have yet to get them on the phone after four solid attempts- even just sitting at work I’ve had to hang up after half hour wait times. As of today, Saturday 10/18, I DID see that the balance transfer check to WaMU mastercard bounced on 10/14. I guess WaMU’s site didn’t update until today- and I was hit with a $35 fee. Based on everyone’s comments and the fact that it’s another institution I highly doubt I am going to get this refunded to me by AMEX blue, but it can’t hurt to complain and try to get this refunded.

    I’m definitely paying this card off after I try to get that refund. I guess I may as well close it.

    You know what the really funny part is? Now at the bottom of my online statement, the button for “request a credit line increase” is suddenly back! HA! Maybe i should click it…

  • Tr
      30th of Oct, 2008
    0 Votes

    Yes, at the moment I consider American Express to be the ### of the earth. I've had a card for decades and for decades, even including some bad times, I've paid more than the minimum and always on time for both my personal and business accounts. I don't think American Express understands the anger that its actions have stirred up. Right now, despite the dire economy, things are improving for me and the first thing I'm going to do when I am able to do so is switch to another credit card company and ditch these disloyal and greedy SOBs. I encourage everyone to do the same when and if they can. We have the power together to make American Express pay dearly for its disgusting behavior. Let's do so.

  • Ji
      4th of Nov, 2008
    0 Votes

    We all have to realize that credit is a "privilege" and certainly not to be taken for granted, however, for AMEX to turn on some of its best customers with unfair credit line decreases and little if ANY notice is a question of ethics! This directly impacts our credit scores and once another creditor(s) get wind (which they WILL) its only a matter of time, thus leading to MASSIVE credit score reductions! I ask, are they making the right move in effort to "alleviate risk" and "walk all over" their customers, or is AMEX merely inviting millions of upset people to simply "walk away" from them adding yet more to their mounting unpaid credit card debt?

  • Se
      9th of Nov, 2008
    0 Votes

    I completely agree with all these comments as the same thing happened to my business. Amx has had absolutely no shame in lowering lines of credit without notification causing bounced checks and thereby degrading their customer's credibility.

    One can blame the accursed legions of lawyers and lack of congressional oversite that these "lenders" use and hide behind when creating contracts which allow for unilateral termination of credit for any reason whatsoever--this would include the color of a customer's shoes.

    Who runs AMX? A group of ###rdly ###s who pretend to offer decent customer service but when it comes to really offering customer service fall flat on their faces.
    Why on earth are they all running around like chickens with their heads cut off.
    Poor American Express, they are so without resources.

    Amx decided months ago to terminate lines of credit and instead of announcing a date when the accounts would be lowered or closed, they chose to send letters out AFTER making the decision and closing or lowering lines of credit.

  • Am
      14th of Dec, 2008
    0 Votes

    I too am a Business Owner. I was lured by their "OPEN" advertisement, and used them to secure additional working capital instead of going through traditional banks. I had a card with a $38k limit, and as soon as I made a significant payment, they reduced my limit to $8k. A $30k decrease - I got a call on a Sunday night! Same BS from the other posts above when I called... I have been never late, and I bring in revenues of over $1MM in my AMEX MECHANT accounts.

    I totally feel like I have been raped. If I was late for 1 payment, I can understand the consequences, but they did this on a "routine review"... I don't remember them doing a "routine review" in the last 4 years???

    This is now hindering my cash flow, as I feel like I just lost $30k into the wind.

    Someone should put up some "public announcement" type commercials about UN-AMEX.

    I will be willing to give a testimonial to their BS.

  • Og
      27th of Dec, 2008
    0 Votes

    This is my motto of Amex: "American Express... Leave home with out it!"

    The following is a letter I recently sent Amex.

    To whom it may concern,

    Unreasonably penalizing me has been a tremendous insult and a slap in the face. Reducing my credit limits on all of my American express accounts was unwarranted and uncalled for. While it is true that I owe a balance on some of my accounts with you and other creditors, we both agree that I have made my payments on time if not in full but at least I have made more that the minimum payment required. The accounts that I carry a balance have a stable interest rate, at a reasonable, predictable level. They also have regular payment amounts that are manageable within my budget, and can be paid on time. Moreover, I make sure that such debt is paid in full, before attempting to use the account again.

    I have requested the amount of credit in a short period of time for the sole purpose of building an excellent credit history in order to make a successful personal and financial future for myself. Lenders cannot determine if I am a responsible borrower if no accounts are listed on my credit history. Nor can they tell whether I have made payments on time or were late if no balance was ever reported. Therefore, being in dept is the main factor to prove to my lenders how well I manage my accounts. Having accounts with a high credit limit or loan amount is another factor that would indicates to my lenders that I can be trusted. I consider myself a responsible lender because I borrow only what I can afford to pay back. I also, always carry reserves in CDs, mutual funds, and savings account. These reserves I will use in the event that I need to pay off my depth and not ruin my credit history.

    My credit profile indicates that I have made my payments on time and never have I had or currently have any overdue accounts or derogatory information, such as collection, charge-off, or bankruptcy. I maintain a good cushion of available credit between my current balance and my credit limits on all my open trades. While Visa, MasterCard, and Discover are congratulating me on my excellent credit history and increasing my credit limits, the person/s making decisions at American Express are lowering my credit limits not on one but on all of my accounts. This has now caused a negative impact on my credit report; but needless to say it has also caused American Express a good customer and potential future customers. I now view American express a company with unfair practices. The likely hood that I would recommend American express to family, friends and colleagues has drastically declined from Ten to ZERO. I now understand why most businesses prefer to use Visa, MasterCard and Discover than to American Express. But I also understand how difficult it is to get the big picture when you, (the person/s make decisions at Amex) have such a small screen.

    Attentively,
    Leonardo Medina

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