How Can I Change My Credit Limit?

By Peter Kenny

Many people ask this question and for different reasons. Some of the reasons for wanting a higher credit limit are good and sensible reasons. Others are not. Let's look at some of the issues involved with changing your credit limit.

Your credit limit is the maximum total amount that you may use on your credit card. This total amount includes everything including purchases, balance transfers, cash advances, fees, and finance charges. This is a pre-set limit and if you go over this amount you may have to pay a penalty fee. When you increase your credit limit you are able to purchase more without incurring penalties. It is that simple.

Here are some tips to help you get a higher credit limit on your credit card.
First, you should ask your card issuer to send you any literature that they may have concerning their policy on requesting a higher limit. Some companies do not have this in writing, but many do. When you read the literature you can assess whether or not you can meet the added requirements.

Second, you should understand that much of the decision on whether or not you will get the higher limit will be based on how well you have paid your bills so far. If you have not been prompt on your past bills, the card company may assume that you will not be prompt with the higher level.

Another issue that you should examine is timing. If you only received the card a few months ago and have already maxed it out chances are the bank or card issuer will want to wait before allowing you greater limits on your credit line.

When you have a card that is already maxed out, it is a good idea to make sure that you make prompt payments for at least six months (or longer) before asking for more credit on the same card.

If you know in advance that you will want to increase the credit limit on a particular card, use that card regularly and make your payments on time. This shows the company that you are using the card and that you are credit worthy.

The size of your payments will make a difference as well. Whenever possible, pay the outstanding balance on your card a few times. This shows the bank or issuer that you are on top of your finances. Try to avoid only making the minimum payments as this may cause the company to wonder if you can make higher payments with a higher limit.

Try to never have to make late payments. The card issuer will certainly look at how often you make late payments and this will not help your case when asking for a higher credit limit.

Perhaps the best way to get a higher limit is to simply use your current card wisely and to make your payments on time. This means more to the issuer than you can imagine.

Keep in mind that if you are already struggling with credit card debt, having more access to credit may be very harmful to your financial future. Many people believe that if they can only borrow more, they can get out of debt trouble. For the most part, this does not work. If you truly need and can afford a higher credit limit, then ask for it. With a good history of past payments you will probably get it.

About the author:
Peter Kenny is a writer for The Thrifty Scot, please visit us at bank charge refund and 0% balance transfers Visit http://www.thriftyscot.co.uk

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Do You Need A Higher Limit On Your Credit Card

By Linda Tanner

Nearly everyone who has a credit card has the goal of a higher line of credit. A higher credit card limit will enable you to make much higher purchases, normally purchases that you are unable to get with your current line of credit. Another reason you may want to increase the limit on your credit card is because increasing your limit could raise your credit score, which could make you eligible for better interest rates on future loans.

That may be surprising to hear, but it is very true. If you have a credit limit on your card and are close to the maximum limit on that card, it sends a danger signal to prospective lenders that you are entering into a danger zone. It is seen as a sign of future financial trouble. As far as your credit score is concerned your debt to limit ratio is a key factor. In other words, if you owe $1000 on a card with a limit of $5000, your credit score will be higher than if you owed that same $1000 on a card with a limit of $2000.

The most important thing to do when improving your credit limit is to improve your overall level of credit worthiness. This tells banks and lenders that you can be trusted with credit, and that you are little to no risk for them. When lenders and banks look at your credit report, this is the first thing that they look for.

Once you prove to a bank or credit card company that you can be trusted to borrow money, they may raise your line of credit. You should be careful with this strategy however, as this could only apply to your bank or current credit card company. Having a higher credit line may allow you to have more purchasing power, although it can also leave you with more fees and even an increase in your current interest and APR charges.

Another great way to increase your credit limit is to use your credit card every chance you get. When you have a credit card, don't use it just for emergency purposes. If you save your credit card for emergency purposes only, you'll rarely use it, which is a good thing if you are wanting to get out of debt, but in this case we are talking about increasing your credit score. When this happens, your company will begin to wonder about your spending behavior and ability to pay it back, therefore they will start to think twice about giving you a higher line of credit.

When you send in your payment, always try to pay more than just the minimum amount. If you can afford to, you should try to pay the whole outstanding amount. Doing so shows credit card companies and banks that you are striving for better credit. This way, you'll show them that you deserve to have a higher line of credit.

If you follow the above tips, you'll get your credit limit higher in no time at all. Once you get your limit raised, you should protect it at all costs. If you continue to strive for perfection--you will get a higher line of credit than you ever thought possible.

Linda Tanner researches and writes about debt relief and repairing your credit. If you would like to receive a free 43 page mini-ebook on improving your credit and learn more about the use of credit cards, loans, repairing your credit or getting out of debt check out www.restoreurcredit.com

Article Source: http://EzineArticles.com/?expert=Linda_Tanner

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