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What counts as income?

New Contributor

What counts as income?

I have been getting low credit limits on new cards and having a hard time with CLI's, and I think that may partially be because of a low income. ($30k) I am a student and I work a little more than part time as a well paid server, but all of my school costs are covered through financial aid (grants and scholarships, minimal loans). So my question is, it the amount of scholarship and grant eligible to be counted as income on applications for credit?

 

It totals about $27k/year, and pays for tuition, housing, and a meal plan. 


25 REPLIES
Frequent Contributor

Re: What counts as income?

What do you consider low limits purely out of curiosity? We all have different versions of low...

Then I may be able to provide some personal experience with my limits related to income... As always YMMV...
AAOA 1 year Fico 08's 738 739 703
Established Contributor

Re: What counts as income?

Scores and Utilization can help us help you.

Valued Contributor

Re: What counts as income?


rkfergus wrote:

I have been getting low credit limits on new cards and having a hard time with CLI's, and I think that may partially be because of a low income. ($30k) I am a student and I work a little more than part time as a well paid server, but all of my school costs are covered through financial aid (grants and scholarships, minimal loans). So my question is, it the amount of scholarship and grant eligible to be counted as income on applications for credit?

 

It totals about $27k/year, and pays for tuition, housing, and a meal plan. 


If it helps, I put down 30K as my income and my average credit card limit is 10K and I have 15 cards. I doubt it is the income that is causing your problem...Are you at or near your credit limit on any card? In my experience it is often those that are at too high utilization, or balances reporting on too many cards that have low credit limits.




TU fico08=820 11/10/17
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Garden since 4/5/2017
Valued Member

Re: What counts as income?

To answer OP's question - yes, scholarships and grants can be included. According to the amenment to the CARD act, borrowers over 21 can list any income which they have "reasonable expecation of access" and those 18-21 can report only independent income which still includes both scholarships and grants.

 

With that being said, I agree with what others have mentioned your low SL and CLI issues are more than likely not the result of low income stated on your application but the result over your overall profile.

Valued Contributor

Re: What counts as income?


sarge12 wrote:

rkfergus wrote:

I have been getting low credit limits on new cards and having a hard time with CLI's, and I think that may partially be because of a low income. ($30k) I am a student and I work a little more than part time as a well paid server, but all of my school costs are covered through financial aid (grants and scholarships, minimal loans). So my question is, it the amount of scholarship and grant eligible to be counted as income on applications for credit?

 

It totals about $27k/year, and pays for tuition, housing, and a meal plan. 


If it helps, I put down 30K as my income and my average credit card limit is 10K and I have 15 cards. I doubt it is the income that is causing your problem...Are you at or near your credit limit on any card? In my experience it is often those that are at too high utilization, or balances reporting on too many cards that have low credit limits.


 

You are doing awesome to have  a 10k average and 15 cards. My stated income is 100k and my average currently is only 7k  accross 32 cards, and my AAoA is 4 years 7 months and my oldest account is 18 years. Give it some time, your limits will grow as you get new cards and your income grows. With only a 30k income, your lenders are probably concerned about how you will pay them back  in a timely manner if you even use 30% of your total limits (guesstimated at  150k) which would be about 50k is more than 1.5x of your yearly income not including interest. 

 

Cards: Chase Southwest 20k & CSR 10k & CSP 10k & Freedom 6.6k & Amtrak/Freedom 4.6k, FNBO DISC 25.1k Oregon Duck 5k, & AMEX BCP 15k & Hilton Surpass 7.5k & Delta Gold 6k & Zync NPSL, Fidelity AMEX 17k Commerce5.9k & Cash Forward 7.5k & Sams Club MC 10k, Paypal Extras MC 7.5k, CapOne Venture 15k, QS 2.5k, QS 750, Amazon 5.9k, Walmart 10k, Citi Simplicity 9k, Discover IT 16k and a nice stack of store cards.
Last APP/HP 5/15/2017 Marcus Loan. 30k
Established Contributor

Re: What counts as income?

Your doing pretty well for having those limits at that income. My question is why do you want or need bigger limits? Why would you want a card with a 20K limit if your hardly going to use it? I understand the utilization part but I think that's just a little bit much, I think what you have right now is perfect for your income and spending.

New Contributor

Re: What counts as income?

To answer everyone's questions, 

 

My SL on marriott is $5k, the lowest that card goes (not yet reporting).

USAA started at $500, now at $1500 with 50% reporting. 

CapOne started at $500, now at $2000, 0% reporting. 

I was just approved for AmEx BCE with SL $1k, which I would assume is the lowest SL. 

 

USAA and CapOne were both opened in 2/2016, showing 12 months of on time payments. 

 

I don't want or need a ton more of avaliable credit, I was mostly just disappointed that my CLI requests on USAA (denied for util, makes sense) and CapOne were denied, and that BCE was so low. Ideally, my total credit limit across all lines would be 50% of my income, either $15k or $30k depending on whether scholarships and grants are being counted. 


Frequent Contributor

Re: What counts as income?


masseffect wrote:

To answer OP's question - yes, scholarships and grants can be included. According to the amenment to the CARD act, borrowers over 21 can list any income which they have "reasonable expecation of access" and those 18-21 can report only independent income which still includes both scholarships and grants.

 

With that being said, I agree with what others have mentioned your low SL and CLI issues are more than likely not the result of low income stated on your application but the result over your overall profile.


I wouldn't think that this is true.  I don't think the OP has access to that money.  When I received scholarships and grants, they went to the school, not me.  That money is allotted to school expenses.  Creditors want to know what you have access to in order to pay the bill.  OP does not have that money to pay on a credit card bill. 

 

I do think that income can limit how much a person gets as far as credit.  I don't know why someone who makes $30000 working part time needs a lot of credit.  As income increases, I would think that credit will.

Established Contributor

Re: What counts as income?

Bring all card balances to $0 except leave 1-9% utilization on one.  Let your reports update with that intact, then continue your app journey.

 

A good way to big lines is to get cards that grow well and quickly like Amex and Discover.  Grow the limits, then use those limits as leverage for apps at new institutions.