Liz Pulliam Weston

I think the banks are tightening in on the credit limits for a good reason. Part of the reason the bubble got so high was too easy money. Now the government has stepped in and it will be hard for the average honest person to sort all this out. The lack of liquidity which occurred during the Bush years was in part due to too high credit limits, ... See Moreof course, it is wrong to give penalties if the limit is lowered without your prior knowledge but I bet the banks sent "fine print" warnings and no one read them. Who really reads all that fine print...it's a rare person. Too much hassle. That's why it's better to have one or maybe two credit cards at the very most and so many credit cards can already be used just about anywhere...I'm surprised that they still have store cards. They just have those so you will shop only at their stores....and that brings in the gimmicks of points for this and points for that which often are never used by the credit card user. Monitor your own finances and your FICO score will improve. Pay your bills on time and your FICO score will improve and take time to hassle the mistakes they made or you made...that's all an honest person can do. The banks are made up of human individuals just like you and me.

home depot did the same as above as indicated by john. and that was a blessing in disguise.. apparently they have ended their accounts with mastercard. so good for me.

You'll probably want to start with a secured card, which requires a deposit. CardRatings.com and CreditCards.com list secured credit card issuers. Read the comments and details carefully so you understand what you're getting.

If you already have a sufficient emergency fund (3-6 months' worth of expenses) and no toxic debt (credit cards, payday loans), then paying down a fixed-rate debt may be a good idea. Just make sure there are no pre-payment penalties on your loan.

Another idea is to fund a Roth IRA. No tax break going in, but tax free in retirement.

You're welcome. ; )

You can find my recent articles using my expert page, http://money.msn.com/liz.

Late payments will hurt your scores (the higher your scores to begin with, the bigger the hit). If the modification is reported as a settlement, which it may be, that's another big hit to your scores.

If they're turned over to collections, yes.

Glad to help!

Morningstar.com regularly lists the country's best and worst plans. Also check out SavingForCollege.com.

Again Thank you.