To obtain an increased credit limit, you'll need a long-term plan. Unless you have perfect credit already, you should aim for 6 months of impeccable credit before asking for a limit increase. Issuers are also more likely to increase your card limit if you are not currently carrying a balance, it makes you seem more trustworthy. The better your credit history, the more likely you are to be approved for a credit increase.
The best way to establish and maintain good credit, is to pay all bills on time, pay more than the minimum payment, avoid carrying a balance more than 20% of the credit limit, avoid maxing out any credit cards (or lines of credit), and refrain from applying for too many cards too frequently. If you follow all of these guidelines for at least 6 months prior to asking for a limit increase, you are a lot less likely to be denied.
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Credit card issuers like to increase balances for their quality customers. As a standard business practice, credit issuers periodically review consumers’ accounts. If an issuer determines a consumer is eligible for credit limit increase (based on Issuer’s internal guidelines), the issuer will unilaterally increase the consumer’s credit limit. It is not uncommon for a consumer learn of their credit increase until after the fact. Increasing one's credit limit encourages customers to spend more, thus potentially making the bank more money.
Speaking to an individual via telephone is the best way to apply for a credit limit increase. Do not apply through an automated telephone system or with an online portal. Before making request, confirm your credit issuer has the most updated income information. Be prepared to provide proof upon request. If denied, try again in 6 months. Remember, it’s a long-term plan.
There are a lot of credit card issuers out there, and it is tempting to run out and apply for an increased limit with another credit card. However, too many credit applications can harm one’s credit score. So, it’s best to wait it out with your current credit card holder to see if they are willing to budge. You might even tell them you have other offers available to you, a little competition doesn't hurt.
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If you get your credit increase, and we're betting you will if you follow these tips, you still must be responsible. Just because you double your credit limit, doesn't mean you're not going to have to pay the piper on those new designer jeans. Never charge what you can't pay back, and your relationship with your credit lender will be mutually beneficial!
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