All Topics / Finance / Credit card limit

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  • Profile photo of renelrenel
    Join Date: 2012
    Post Count: 40


    On the rare occasion I go over my credit card limit I receive a text message from my bank. Good.

    Recently when this happened, it was over by $500. My husband and I knew that we had spent extra lately, so the amount was not an issue. I did call my bank though, because I was concerned that we were able to go over this much. I would have thought that at the limit (or slightly over) the card would be declined. My bank (on 2 separate phone calls to two different people) said they cannot limit the card (and cheekily said to be mindful of my spending!). I questioned why they have different credit card limits, and at times offer for my credit limit to be increased, if we can all spend what we like anyway? They could not answer this. I said that I have chosen to have a $3.5k limit on my card, as this was how much we spend in a month (and I use the credit limit as discipline and a reminder), and that if my card allows me to spend $5k, or $10k, then there is no point in saying the limit on it is $3.5k.  The guy once again told me I should be aware at all times of how much I am spending.

    This does not seem like responsible lending practices? If a person was on a low income with no assets, and had been approved for a small credit limit, then wouldn't it be irresponsible of a bank to allow that person to spend $10k?

    I agree that a person is responsible for managing their own spending and finances, but surely banks are taking advantage of people in this way? It just doesn't seem right to me….thoughts?

    Profile photo of Jamie MooreJamie Moore
    Join Date: 2010
    Post Count: 5,069

    Be careful with going over your limit. If you require a home loan with the same bank in the future – the credit scoring of your application might be poor due to the conduct on your credit card.



    Jamie Moore | Pass Go Home Loans Pty Ltd
    Email Me | Phone Me

    Mortgage Broker assisting clients Australia wide Email: [email protected]

    Profile photo of SpongySpongy
    Join Date: 2013
    Post Count: 22

    And I'm sure they charge you a nice over limit fee for the privilege :)

    Profile photo of HomeLoanExpertsHomeLoanExperts
    Join Date: 2007
    Post Count: 43

    Yeah it is a tough one as if banks stop payments that would take someone over the limit then this causes other problems. We often hear people complain that they had $10k in cash in their bank account and their bank declined  a $30 transaction on their credit card. Also a lot of customers get embarrassed when their card declines.

    It would be great if they gave you the choice to have it either way. I guess that isn't always possible with their systems. 

    Profile photo of JpcashflowJpcashflow
    Join Date: 2007
    Post Count: 575

    Also their argument would be this, if you are close to going over your limit then why use it again anyway?

    Jpcashflow | JP Financial Group
    Email Me | Phone Me

    Your first port of call in finance :)

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