Credit cards are a convenient way to make purchases. When your individual circumstances change, you may require a higher credit limit to meet your needs. However, getting a credit limit increase may require effort on your part. To help, we spoke with the experts who shared the best tips to increase your credit limit.
Here are the 20 ways how to increase credit limits, straight from the pros:
1. Regularly Update Your Income with Your Credit Card Company
Laura Faulkner, Vice President of Marketing, Credit One Bank
Make sure to regularly update your income with your credit card company. Not only does this let the bank know you have the ability to pay, it’s actually a requirement of the Credit Card Accountability, Responsibility, and Disclosure Act of 2009 to update your income in order to qualify for additional credit. The “ability to pay” provision requires card issuers to consider your ability to make the required payments before granting you a credit line increase. Banks cannot legally grant you a credit line increase — or a credit card — without first having your income in order to assess your ability to pay them back. Updating regularly, especially when your income has increased, will help make your request get approved faster.
Jeff Amster, Managing Vice President & Head of Emerging Segments, Capital One
When you’re requesting a credit limit increase, it’s important to know what types of data credit card companies are looking at. Many of the factors that help your credit score, such as paying on time and paying down your balances, also influence whether you are eligible for a credit line increase. You can check your full credit report, including your payment history, with a tool like CreditWise® from Capital One®. CreditWise is a free credit monitoring tool focused on helping consumers understand, improve, and protect their credit. Also make sure to review your credit report for any errors. If you do see a mistake on your report, contact the credit reporting agency right away so they can resolve any errors and help make sure your score isn’t negatively affected.
3. Get Guidance Directly from Your Card Issuer
Clarissa Carlucci, Spokesperson, JP Morgan
The requirements for a credit limit increase really depend on a customer’s individual situation. It’s best for customers to contact their credit card issuer and ask what they can do to get approved for a higher credit line. Usually, accounts are proactively reviewed by the banks periodically to determine appropriateness of the line size.
4. Apply for Credit Cards Designed for High Spending
Matthew Frankel, CFP, Personal Finance Expert, The Ascent
Only apply for credit cards geared towards consumers with strong credit scores and high spending habits, as these tend to have higher limits than so-called starter credit cards. For example, credit cards designed for frequent travelers tend to offer higher limits. Additionally, the most effective way to get higher credit limits from your existing cards is to simply ask for them. Most card issuers even allow you to do this online.
5. Get a Secured Credit Card & Increase Your Security Deposit
Simon Zhen, Research Analyst, MyBankTracker
A secured card is special in that your credit limit is often determined by your security deposit (i.e., cash that is put in a deposit account as collateral). Just deposit more cash and your credit limit will increase. If you didn’t know already, when you increase your credit limit, your credit score will jump up as well.
Normally, with regular credit cards, you’d have to ask for a credit line increase, which may or may not be approved. With a secured credit card, your credit line depends more on your security deposit — in effect, you have more control on the size of your credit line. If you have excellent credit and are in good standing with your credit cards, don’t be afraid to request for a much higher credit limit.
Check out the six best secured credit cards for 2019.
6. Work to Improve Your Credit Score
Gerri Detweiler, Education Director, Nav
Strong credit often means higher credit limits. Check your personal and business credit reports and scores — you can do this for free at Nav.com — to see whether there is anything you can do to strengthen your credit profile. For example, if you have a high balance on a credit card, paying it down or refinancing with a different type of loan may improve your debt usage ratio, resulting in a higher score. Once you’ve done all you can to build strong credit, ask your lender for a higher limit.
7. Come Close to Using Your Credit Limit Each Month
Daniel Gillaspia, Founder, UponArriving
Coming close to meeting your credit limit each month is the best way to get an automatic increase for both personal and business credit cards. Make sure to pay off the balance entirely. For charge cards, you might consider making a prepayment on your card so that your credit balance goes into the “negative” and frees up credit (this will allow the bank to see you’re a high spender who needs the additional credit). Something to be on the lookout for is if the bank conducts a hard pull on your credit report. They have to notify you that they will do a hard pull, so you should get a warning. Some banks only conduct a hard pull if you’re requesting a very large credit limit increase.
8. Demonstrate Your Ability to Payoff Balances
Deborah Sweeney, CEO, MyCorporation.com
In order to increase your credit card’s credit limit, you should start showing a history of payoff ability. You can gradually spend, and increase spending over time, but you also need to be able to illustrate how you can pay down and off any accumulated debt. In some cases, it may be wise to take credit for expenses you can cover with cash to increase a credit limit without paying interest.
9. Determine Your Bank’s Policies for a Credit Limit Increase
David Melnicoe, Founder, Tradeline Supply Company, LLC
One of the best ways to increase your credit limit quickly is to get familiar with the bank’s recent practices for credit line increases. For instance, Barclay’s will allow for a hard pull credit limit increase every six months. For about a one-year period, Discover was giving out increases every 16 to 31 days through a soft pull credit line increase request on their website.
On the other hand, some issuers, like Chase, require a hard pull for a credit limit increase, but even then, they are known to be stingy with credit line increases. However, by applying for a second card with Chase, you can combine balances and quickly build a single high limit card. Several other banks allow for this practice as well, and policies do change from time to time.
Creditboards.com is a good resource for getting up to date information on each bank’s current practices for credit limit increases. Armed with this knowledge, a borrower can formulate the best bank-specific plan of action for increasing their credit limits.
10. Increase the Number of Deposits into Your Bank Account
Eden Amirav, CEO, Lending Express
Online business lenders will assess your bank account and transaction history when you apply for a loan. They will use this information, firstly, to decide whether or not to approve your funding request, and secondly, to set your credit limit. The more money you have coming into your bank account on a regular basis, the better your chances of receiving the funds you need and increasing your credit limit.
11. Manage Your Credit Well
David Kilby, President, FinFit
To increase your chances of getting a credit limit increase, it’s important to know how to manage and control your credit well. Use your credit card to make purchases you would normally pay for with cash, a check, or bank online payments — things like utility bills, groceries, gas. Don’t charge more on your credit card than you can afford to pay outright. Ideally, you want to pay off the balance you’ve charged each month.
12. Prepare Necessary Documents
Yuko Kawamoto, Finance Staff, Founder’s Guide
When requesting a credit limit increase, you need to prove that you can handle the possible increased debt. Your credit card issuer may require certain documents as proof, such as your current income or pay stubs, tax return, loans, and other regular expenses. To make the request process faster, you have to ensure that these documents are ready and on hand when you call or visit your issuer.
13. Increase Your Income
James R. Duren, Personal Finance Expert & Credit Card Analyst, HighYa.com
It’s best to have an increase in income to accompany your request for a credit limit increase. This influx of new money, in theory, means that you have an increased ability to pay back a bigger balance. Keep in mind that the credit card company will most likely do a hard credit check in order to find out if you have any red flags in your recent credit history. However, the points you gain from having an increased, unused credit limit will negate the points you’d lose.
14. Manage Your Credit Responsibly & Wait for an Increase
Jordan Tarver, Staff Writer, Fit Small Business
Some credit providers will reward you for managing your credit responsibly with automatic credit limit increases. If you stay on top of your payments, you may see increases in your credit limit without having to put in a request. For example, some people may start out with a $500 credit limit and six months later receive an automatic increase to $2,000. If your credit provider doesn’t offer automatic increases, you can generally request an increase through your online banking account.
One way to convince your credit card issuer that you deserve a credit limit increase is to show them that you have frequent transactions on your credit card and can pay your balance off promptly. The Cheat Sheet suggests that you stop paying for things in cash and put them on your card instead. This way, your issuer will see you have a big usage each month and that you may require a higher credit line.
According to Discover, one of the best times to request a higher credit limit is when your credit score is strong. Good credit is a strong factor to get approved for a credit limit increase. If your credit score is higher than when you first got your card, it means it’s a good time to ask your issuer for a higher credit line.
17. Reduce Your Credit Utilization
Michael Cetera, Staff Writer, Fit Small Business
The No. 1 factor that can affect your credit score is your credit utilization — how much credit you use versus how much credit card issuers have given to you. It accounts for 30% of your FICO score. And the higher your credit score, the more likely you are to get a credit line increase. If you have a credit card with a $1,000 limit and you put $500 on the card in a month, your utilization ratio is 50%. The quickest way to improve your credit score is to reduce your utilization ratio. Experts recommend using 30% or less of your available credit.
A balance transfer is when you transfer your balance from one credit card to another. Most credit card issuers love balance transfers. According to CardRates.com, you will likely get approved for a credit limit increase if you tell your issuer that you’re planning to do a balance transfer. This can also be a good deal because some issuers offer 0% interest for balance transfer transactions for up to one year or more.
19. Don’t Ask for Too Much
Dennis Shirshikov, Finance Writer, Fit Small Business
When consumers request a credit limit, a common mistake is to ask for too much. A better alternative is to request a modest increase of 10% to 25% and gradually increase the limit over time. However, if your income has improved drastically since you last received a credit limit increase, you may be able to get a larger request approved.
Another great way to increase your credit limit is to combine two different credit cards as long as they are issued by the same credit card company. InCharge Debt Solutions suggests that you pick the one with the better benefits for your personal circumstances and/or longer credit history.
A higher credit limit on your credit card makes spending a lot easier and more convenient. However, not everyone gets approved for a credit limit increase — first you have to demonstrate that you’re financially responsible. Use these expert tips for how to increase your credit limit as a guide the next time you request an increase to improve your chances of approval.