Why was my Ally Everyday Cash Back Mastercard credit limit lowered?
Your Ally Everyday Cash Back Mastercard® credit limit may have been lowered due to late payments, inactivity on your card, or a change in your credit history. Ally Bank will periodically review how you're managing your current limit and may lower it if they don't think you can afford the full thing.
You can call Ally Bank at 1-888-366-2559 to ask about the particular reasons why your credit limit was lowered. You can also learn more about the most likely causes and how to avoid future credit-limit decreases below.
Why Your Ally Everyday Cash Back Mastercard® Credit Limit Might Have Been Lowered
- Missed payments: If Ally Bank detects a number of missed or late payments, they could assume that you might be experiencing financial difficulties, and reduce their risk by lowering the amount you can borrow from them.
- High credit utilization: Your credit utilization is the ratio of the amount you're borrowing compared to your credit limit. If your balance is frequently close to your limit, Ally Bank may see you as risky, and they're likely to limit how much you can spend – especially if other aspects of your credit profile seem shaky.
- Inactivity: If you aren't using any of the limit that's available to you, Ally Bank might eventually lower your credit limit accordingly.
- Changing market conditions: Ally Bank may have lowered your credit line to limit its risk in response to changes in the economic environment. Many people's limits got lowered by credit card companies during the COVID-19 pandemic, for example.
While your card activity might not always be the reason for a credit limit decrease, you can reduce the chances that it will be lowered in the future by using your card regularly and responsibly.
How to Prevent Your Ally Everyday Cash Back Mastercard® Limit From Being Lowered
- Never miss a due date. Missed payments are one of the main reasons why your Ally Everyday Cash Back Mastercard® credit limit might be lowered. You should always pay at least the minimum amount required by your due date. Setting up automatic monthly payments from a bank account can help with this.
- Use your card once a month. Your Ally Everyday Cash Back Mastercard® credit limit may be reduced due to inactivity, so it helps to make at least one purchase with your card each month to keep it active.
- Keep your balance low. Another factor that could make you appear risky is if you have high credit utilization. Ideally, you should keep your balance below 30% of your credit limit.
In most cases, Ally Bank isn't legally required to inform you before they change your credit limit. The exception is if your new limit would result in an over-the-limit fee, which you generally must opt-in for. In this case, they must notify you 45 days before the limit goes into effect, or they must waive the fee.
If your credit limit has already been lowered, you can try requesting a credit limit increase, especially if your account has been in good standing for several months.