If a card issuer decreases your credit limit, the card issuer cannot charge you over-the-limit fees or a penalty rate for exceeding your new, lower credit limit, until 45 days after it has given you notice of the decreased credit limit. A card issuer cannot charge you over-the-limit fees if it didn’t give you notice of the decreased credit limit and if you haven’t opted into the payment of over-the-limit transactions.

In most instances, the card issuer must give you a “adverse action notice” when it makes certain unfavorable changes to your account, such as lowering your credit limit, or when it terminates your account. This notice should either provide specific reasons for the action taken or allow you to request a statement of specific reasons. These notices discourage discrimination and they help you learn the reasons for the decisions.

Tip:

Don’t get too close to your credit limit. Experts advise keeping your use of credit at no more than 30 percent of your total credit limit. This can help you avoid problems if your credit limit is lowered. It can also help you keep a good credit score.