What to Know About Getting Credit Limit Increases

Credit limit increases are an easy way to help decrease your credit card utilization and give your credit score a boost. With a credit limit increase, a bank will increase the limit for you on your credit card so you’re able to free up more credit but also benefit your utilization. And these are issued more often than you think, a March 2017 poll conducted by CreditCards.com found that 89 percent of cardholders who requested a higher credit limit received one.

Hard pull inquiries

One thing you need to be aware of before requesting one of these is whether or not the bank will issue a hard pull on your credit report before they process the increase, since a hard pull could decrease your credit score by several points. Many banks will make a hard inquiry when you request a credit limit increase but not all of them will. If they do, then you’ll have to decide if another hard inquiry will be worth the increased credit limit (assuming they approve it).

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Timing

I suggest waiting at least six months before requesting a credit limit increase on your credit cards. It’s possible that you could get one sooner but many issuers are reluctant to grant you an increase until you’ve shown them some positive payment history of around six months.

How much to request

These increases are usually relatively small but generally people request about a 10% to 25% increase. It’s possible that you could be given more than that (I was once given a 50% increase) but try not get too crazy when requesting the credit limit increase. If you ask for too much, they might deny you altogether. If your request for a credit limit increase is denied, plan on waiting at least another 90 days before requesting one a second time.

How to request  

You can sometimes request these online when you log in to your account to manage your credit cards or you can just call up the bank and request it.  If you call, be prepared to explain to a representative why you want the increase.

Avoid sounding desperate and try to bring up things like your solid payment history with the bank to persuade them to give you the increase. If you recently got a raise or are in a better financial situation than you were when you opened the card you can bring that up. Also, if you’re planning on making some larger purchases in the future (weddings, remodeling, vacations, etc.) that can also be a good reason. (Just watch out because some banks will sometimes offer temporary credit limit increases to assist you with single purchases.)

Your goal is just to leave the bank agent with assurance that you’re going to be responsible with the increased credit limit and aren’t requesting one because you’re struggling to make ends meet.

Auto increases

Banks will sometimes increase your credit without you even asking. If you have a low credit limit and are constantly coming close to hitting that limit and are constantly paying off your balance, there’s a good chance you might get a credit increase. However, if you’ve been waiting for over six months, it’s probably time to call them to inquire about it.

Consider transferring credit

If you have more than one credit card with a bank there’s a possibility that you might be able to transfer credit from one card to another. Not all banks allow this and sometimes these come with restrictions but banks like Chase will usually allow you to transfer from one credit line to another. By doing this you can improve the individual utilization on one of your lines without incurring a hard pull (but always be sure to verify that there won’t be a hard pull).

Don’t wait until it’s too late

One final tip, if you want to bump up your credit line try to ask for the bump when you don’t need it. If you wait until your credit card is maxed out or when you’re only making minimum payments then the bank will probably be less likely to raise your credit limit because they will see you as more of a credit risk. Also, it’s a good idea to actually use the card you’re going to request a credit increase for. Otherwise, a bank may see no need for your increase and deny you.