, a lower limit can add financial stress — especially if you only have one card.
Here's what you need to know to keep your credit score healthy, and what you can do if an issuer lowers your credit limit.Credit card issuers have to alert you before changing your interest rate, but they're allowed to adjust your credit line without notifying you. And according to Ted Rossman, industry analyst at CreditCards.com, issuers may tighten their lending restrictions even if you're a trustworthy borrower.
"Looking back to the Great Recession as a guide, the October 2008 Fed Senior Loan Officer survey found 20% of card companies cut credit lines for customers with prime credit scores and 60% reduced lines for subprime cardholders," Rossman said. "Banks are once again very nervous about the state of the economy and the job market and they're pulling back on their risk exposure.
If you're looking to apply for a new credit card, getting a lower credit limit than what you'd expect on your new account won't tank your credit score. As long as you don't start carrying a higher balance, having a new line of credit could actually