What Do Chase, CitiGroup and Bank of America Pertain to Your Your Work Search?
Once upon a period of time, credit card issuers typically only trimmed credit lines on customers whose behavior suggested they might become a credit risk. For example, late payments, going over an existing credit line, bad credit - those types of things might have triggered the bank to decrease the amount of money they had been willing to lend.
It seems like pretty much everyone is in the crosshairs of the banks.
They're now looking at those who have excellent credit and spotless repayment histories. Customers who never possess a balance (i.e. they pay completely each month), pay on time, and possess FICO scores as high as 830 are receiving letters indicating their lines of credit have been reduced. I know three people fitting that description who have received such notification in the past few weeks.
There are consequences to that action. If you're one of the people that got this type of letter, you know this first-hand. Because when the bank pulls back your line of credit, your FICO score needs a hit.
Roughly a third of your credit ranking is based on the percentage of credit limit you've used. So a lower credit limit can cause a higher utilization ratio and negatively impact your score...with absolutely no change in your purchase or payment behavior.
What does this have to do with your job search?
If your prospective employer conducts a routine background check as part of its due diligence, your credit report is part of that screening. (Lest you feel this is a minor issue, reconsider that thought. More than 40% of American employers routinely look at the credit reports of job candidates.) And if the Bank of America Careers Login trimmed your credit line, your score was almost certainly negatively impacted.
With the job market as competitive as it is right this moment, you don't need anything dragging you down...similar to a lowered FICO score...especially when there is practically nothing different about your repayment behavior.
There's an extra issue: small businesses proprietors. Lines of credit might be lifelines enabling them to handle cash-flow issues. Like making payroll. Reduced line of credit may mean a forced lowering of head count.
So if you've played from the rules, developed your credit score, and consistently paid your bills - too bad. If they reduce your line of credit, your bank that issued you that card may have a negative impact on your job search.