Americans struggling amid the economic downturn may soon face another financial hurdle. Major credit cards are starting to lower spending limits, and in some cases, cancel cards.
Card issuers like Discover are reining in credit lines for new customers, and lowering limits for current ones. Millions of Americans who have lost their jobs are falling behind on loan payments, which is why financial service companies are hesitant to sign up new customers.
“These banks are nervous about the recent spike in unemployment,” Ted Rossman, an industry analyst at CreditCards.com, said. “They’re worried that people may not be able to pay them back. They’re really clamping down on risk.”
Rossman says if you can, pay down at least part of your balance. If you can’t, contact your Credit Card company, as you might be able to defer payments or strike another deal.