Bucket transfer
On a line of credit account, a borrower's balance is divided between several buckets, which each have their own credit limit and interest rate. These settings initially set by the program used to create the account, but they can also be altered at any point in an individual account’s lifecycle.
This article will cover two tools you can use to adjust your buckets:
- Bucket transfers, which move the balance of one bucket to another.
- Credit limit adjustments, which change the amount a borrower can spend in each category.
You can also change each bucket’s interest rate, which we discuss in our Interest Rate Adjustment article.
Bucket Transfers
On the account summary page, scroll down to the Transactions section. On the right hand side of the screen, click the 'Log' button, and select 'Bucket Transfer' from the drop-down.
This opens a window asking for details about the transfer.
And here's a quick description of each field:
| Field | Description |
| Amount | The sum (in dollars) that you want to move from one bucket to another. |
| Apply date | When the transfer will go into effect. You can select any date in the current billing period or the future; calculations on previous billing cycles are locked. |
| From bucket | Which bucket you're taking the balance from. (This bucket's balance will go down, and its available credit will go up.) |
| To bucket | Which bucket you're adding the balance to. (This bucket's balance will go up, and its available credit will go down.) The balance moved into this bucket will now accrue interest using this bucket’s rate, but the bucket’s interest abatement rules will not apply. |
| Memo | This text field lets you write a description of why you transferred the balance. |
Correcting mis-categorized transactions
You can use a bucket transfer to correct a mistake, but note that they'll only move the current balance from one bucket to another. If those buckets had different interest rates, you'll need to calculate how much interest would have accrued if it were in the right bucket, and then apply a charge or credit for that difference.
Credit Limit Adjustments
To change a bucket’s credit limit, navigate within an individual line of credit account to Tools > Credit Limit Adjustments.
Here, you'll see a list of all the credit limit adjustments that have been made on the account. Each entry includes a Title (a name distinguishing it from other adjustments), the date when it happened, the limit before the adjustment, the limit afterward and the difference between them.
Clicking the arrow at the right of an adjustment will expand its details, showing you info about the user who created it and how each bucket changed. From there, you can edit or delete an adjustment.
Adding an Adjustment
When you click the 'Add Adjustment' button, it pulls up a window to enter information.
Here's a breakdown of each field:
| Field | Description |
| Info | The title of the adjustment. |
| Date | The date when the adjustment will apply. |
| Bucket |
Which bucket the credit limit adjustment will affect. The current credit limit for the bucket you select will appear below the menu for reference.
If you want to adjust the account’s overall credit limit, you’ll need to adjust the primary bucket. |
| New credit limit | The new total credit limit. |
Credit limits and the primary bucket
The primary bucket credit limit serves as the limit for the whole account, so the credit limit of the other buckets must be either lower or the same as the limit of the primary bucket.
For example, you could have a primary bucket with a credit limit of $1000, and then a half dozen other buckets with credit limits of $500. An individual bucket must be smaller than the primary bucket, but the system doesn't restrict the cumulative value of their credit limits.
Was this article helpful?