Did your credit card limit get lowered? Five on Your Side explains why and what you can do

WRAL has heard from several people that the credit limit on their credit cards, suddenly shrunk.

5 On Your Side learned why a lower credit limit could mean you pay more and how you can fight back.

When there are signs a recession could be coming, banks will try to reel in the amount of credit they’ve extended and that typically affects particular groups of customers.

"It is a very common thing when we’re especially when we’re heading toward a predicted recession," explained Matt Frankel, Certified Financial Planner and contributing expert for The Motley Fool Ascent.

He says there are two types of credit card users that see these changes the most.

"It tends to hit people the hardest to a either have had bad credit, credit behaviors, you know, miss payments, they’re close to their limit, things like that, or people who just don’t use their credit lines that often," Frankel said.

That not only hurts your spending power, it can damage one of the biggest factors in your credit score – your available credit.

"So say you have $2,000 in credit card debt and a $10,000 limit, you’re using 20%. If your bank then slashes your limit to $5,000, all of a sudden, you’re using 40% due to no fault of your own," Frankel explained.

That can cause your credit score to drop, forcing you to pay more when you borrow.

Credit card companies are only required to give you notice about credit limit changes in specific circumstances, so know what your limit is and watch it for any changes.

Usually, there is a way to opt out of a lower limit. Call the number on the back of your card to find out why your limit was lowered and if it can be restored.

If they say no, threatening to close the account may sway their decision.

Putting small charges on your credit card then paying it off is a way to show the credit card company you’re using that line of credit and that may help prevent your limit being lowered.

Frankel told us there’s still plenty of competition in the credit card industry and banks are looking for new credit card customers.