I had a $7000 line of credit with Wells Fargo, and I have never been late, but they dropped my credit limit down to $5000, and my balance is $4800. This is hurting my credit.

What should I do?

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    Can you pay it down? What's the question? – Hart CO Mar 30 '18 at 4:23
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    The likelihood that this is "hurting" you're credit to a degree of significance is about zero. What is hurting you is carrying a credit card balance. Pay it off. – Pete B. Mar 30 '18 at 10:59
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    What's your question? – yoozer8 Mar 30 '18 at 11:24
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    I'd say whatever caused them to lower your limit is what's hurting your credit. – kweinert Mar 30 '18 at 11:43

Credit limits are fluid. The bank can raise or lower them at any time for any reason. My guess is that you have been carrying a balance for a while and the bank is concerned that you aren’t able to pay them back, so they decided to stop loaning you more money until you show that you can pay some of it back.

For your credit score, the utilization percentage does effect it, but the effect is only temporary. As soon as your utilization percentage goes down, your credit score improves immediately with no memory of how high the utilization was previously.

Having said that, your credit score is not your biggest problem at the moment, nor is your being cut off by the bank. Your biggest problem is that you have a $4800 balance on a credit card and are likely paying a ridiculous amount of interest each month. This is the problem that you need to fix ASAP.

Paying off this balance in full will solve the problems you are now concerned about: Your score will go up and your bank will let you use your card again, but most importantly, you will not be continuously losing large amounts of money to the bank in interest, as long as you are able to pay your credit card balance in full each month.

Here is what I recommend:

After that point, you will be in much better financial shape than you are in now. Ask yourself if you really need to start using a credit card again, or if you would be better off sticking with cash, check, and debit card.

  • Nice help editing question, and very good answer. Better to do this than to vote to close, 2 so far. – JTP - Apologise to Monica Mar 30 '18 at 12:26

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