States Where Credit Limits Decreased the Most (2025)

When your credit limit drops, it can create day-to-day financial challenges. A lower limit not only raises your credit utilization which can hurt your credit score but also restricts your spending power. On the flip side, it may encourage better financial habits, since charging less often means taking on less debt.

To find out where credit limits are decreasing the most, WalletHub analyzed its data to compare the average change in credit limit per resident across all 50 states between Q2 2024 and Q2 2025.

“The average credit limit decreased in 46 of the 50 states year-over-year as of Q2 2025, with the decrease ranging anywhere from around 0.5% to over 16%. A variety of factors can result in credit limit reductions, such as big increases in credit card debt, delinquency on that debt, or a decline in credit score or income. Inflation also plays a role, as it forces people to charge more to their credit cards, raising their credit utilization and putting them more at risk for delinquency.”

Chip Lupo, WalletHub Analyst

Main Findings

States Where Credit Limits Decreased the Most: Q2 2025 vs. Q2 2024

Notes: *No.1 = Most Decrease.
With the exception of “Total Score,” all of the columns in the table above depict the relative rank of that state, where a rank of 1 represents the worst conditions for that metric category.

In-Depth Look at the Top States

Wyoming

Residents of Wyoming had the largest year-over-year decrease in their credit limits. The average person’s credit limit over the 12-month period ending in June 2025 was around 16% lower when compared to the previous 12-month stretch.

In addition to a big overall decrease over the past year, Wyomingites also had the third-largest decrease in the average credit limit on credit cards opened specifically in Q2 2025, compared to in Q2 2024. The average credit limit was nearly 22% lower.

Wyoming residents’ credit limits are also below-average in general. The average credit limit on cards opened during Q2 2025 is just $4,042, the 10th-lowest in the U.S. The average between June 2024 and June 2025 was $5,070, the sixth-lowest.

Wyoming’s large average credit limit decrease may be due in part to the fact that it is in the bottom 15 states when it comes to income. The state also ranks first in the nation for credit card delinquency, which could further explain why residents are experiencing more credit limit decreases.

Alaska

Alaska ranks second among the states where people got the most credit limit decreases as of Q2 2025. Alaska’s year-over-year credit limit decrease was among the steepest in the nation, with nearly a 12% drop, the third-largest decrease. That kind of plunge left residents with far less borrowing power over the year.

Alaska ranks among the bottom 10 states for income, placing 44th in the nation. Having lower income levels can make it harder for residents to manage their credit, which in turn may lead banks to reduce credit limits. Alaska residents also have had big recent increases in credit card delinquency, another important factor in decreasing credit limits.

Vermont

Vermonters have faced the third-largest credit limit reductions over the past year, when considering both the percentage decreases and the actual dollar amount changes they resulted in. The average resident’s credit limit over the 12-month period ending in June 2025 was nearly 5% lower than during the previous 12-month period. In addition, the average credit limit on new accounts opened during Q2 2025 was around 23% lower compared to those opened during Q2 2024.

Vermont residents aren’t taking on much new credit card debt, and their credit card delinquency rates are about average. But with some of the lowest incomes in the nation, limited earnings are likely driving the recent drops in credit limits.

Methodology

In order to determine the states with the most credit limit decreases, WalletHub compared the 50 states across two key dimensions: 1) Average Credit Limit per User and 2) Change in Average Credit Limit per User.

We evaluated those dimensions using 4 relevant metrics listed below with their corresponding weights, each metric being graded on a 100-point scale.

Finally, we determined each state's weighted average across all metrics to calculate its overall score and used the resulting scores to rank-order our sample.

Change in Average Credit Limit per User - Total Points: 75

• % Change in Average Credit Limit per User for Accounts Opened in Q2 2025 vs. Q2 2024: Full Weight (~37.50 Points)
• % Change in Average Credit Limit per User from June 2024 to June 2025: Full Weight (~37.50 Points)

Average Credit Limit per User - Total Points: 25

• Average Credit Limit per User for Accounts Opened in 2025 Q2: Full Weight (~12.50 Points)
• Average Credit Limit per User for Accounts Opened in Year Ending June 2025: Full Weight (~12.50 Points)

 
Sources: Data used to create this ranking were collected as of September 25, 2025 from WalletHub database.

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