@longtimelurker wrote:But, assuming you can pay in full (and if not low APR is more important than CL), utilization doesn't need to be an issue. Just pay before the statement cuts and you can make your utilization anything. So in this model, high CL saves you the slight hassle of doing this (and in higher interest environments some earned interest) but not really critical to credit score.
True. But for heavy spenders ($5000 monthly), the "some earned interest" could easily be $50 per year. But more than that, I think it's the psychology of using credit cards. I like knowing that I can buy something now and won't have to pay for a month. And if you time it right and buy something right after the statement cut date, then you have nearly two months to have to pay for it. And that makes me feel like a genius for working the system. 
Of course, this is also how a lot of people can get in trouble.
@onstar wrote:
@longtimelurker wrote:But, assuming you can pay in full (and if not low APR is more important than CL), utilization doesn't need to be an issue. Just pay before the statement cuts and you can make your utilization anything. So in this model, high CL saves you the slight hassle of doing this (and in higher interest environments some earned interest) but not really critical to credit score.
True. But for heavy spenders ($5000 monthly), the "some earned interest" could easily be $50 per year. But more than that, I think it's the psychology of using credit cards. I like knowing that I can buy something now and won't have to pay for a month. And if you time it right and buy something right after the statement cut date, then you have nearly two months to have to pay for it. And that makes me feel like a genius for working the system.
Right, but $50 a year really doesn't do much does it? "Wow, $1 a week" especially if a high spender. BTW, I'm not against high limits at all, I just think the usual "utilization" reason trotted out here isn't always real. Especially as utilization doesn't have a history in the score, so at most you need to micromanage it only when apping.
I understand the utilization factor. However, all of these high blance credit cards do affect you and even severely when it comes to buying a house or a loan in general. Even if you do not use them, lenders (not credit card lenders) consider this a huge risk because you have the potential to use them and putting yourself in a lot of debt, which can affect them and increase the likelyhood of bankruptcy.
This is one the of the reasons experts WARN that when buying a house that you should NOT apply for any credit cards or any type of credit no matter how good your score is. lenders consider your AVAILABLE credit and not just credit used when evaluating you for a loan. MANY mortgage loans have been LOST even after approval but before closing because people went out and got more credit.
For me personally, the biggest advantage for a high credit limit is when there is 0% apr for 12 months or longer. This can be like a short term inerest free loan. After that, the high limits have little value. Unless of course I had to use them for an emergency, but that should be avoided at all cost because the interest rates are not worth the use, unless an actual emegency arises and then it should be paid off immediately, which becomes very hard especially if you did not have the cash to begin with.
For those who only charge between $50-$200 a month and pay them off, I really do not see the point of huge limits and wanting more.
Well, that is my two cents.
@Anonymous wrote:I understand the utilization factor. However, all of these high blance credit cards do affect you and even severely when it comes to buying a house or a loan in general. Even if you do not use them, lenders (not credit card lenders) consider this a huge risk because you have the potential to use them and putting yourself in a lot of debt, which can affect them and increase the likelyhood of bankruptcy.
This is one the of the reasons experts WARN that when buying a house that you should NOT apply for any credit cards or any type of credit no matter how good your score is. lenders consider your AVAILABLE credit and not just credit used when evaluating you for a loan. MANY mortgage loans have been LOST even after approval but before closing because people went out and got more credit.
For me personally, the biggest advantage for a high credit limit is when there is 0% apr for 12 months or longer. This can be like a short term inerest free loan. After that, the high limits have little value. Unless of course I had to use them for an emergency, but that should be avoided at all cost because the interest rates are not worth the use, unless an actual emegency arises and then it should be paid off immediately, which becomes very hard especially if you did not have the cash to begin with.
For those who only charge between $50-$200 a month and pay them off, I really do not see the point of huge limits and wanting more.
Well, that is my two cents.
I tend to agree, however we as card applicants do not have control over how the CCC determines the credit limit they are going to grant. Rather, we have to decide whether the benefits of having the card (which includes sign up bonuses on a large number of cards due to the competitive lending environment) are worth apping. Then, because people work on improving their credit handling, that can lead to better FICO scores, and it naturally results in CCC giving higher limits, and more cards being available, and the lenders like good credit risks.
My Freedom card, at $1,500 is more than adequate for the category spend I have on that card, and I'll never overrun that Venture $30k limit, but in most cases, we don't directly control that CL as it is granted by the CCC. I did limit myself on my last AMEX Delta CLI to only go from $9k to $12k, but that is as much to leave potential lending room for any other AMEX revolvers, which, as it turns out, is the SPG this week.
And I have had situations where the larger limit matters. 18 months ago I had to charge a $4,500 transmission replacement. The Capital One $10k limit came in very handy right then.
@Anonymous wrote:
Hi everyone,
I'm fairly new here and in a sense to credit cards in general (although I've been using them for many years). I've been browsing around through various credit card forums and have noticed that people get really competitive and really excited over credit limits...which some of them are sky high.
Can I ask why? It can't be merely because it can improve your credit score, or is it? what is the point of having a $15,000 max?
In addition, going off on a tangent, why do so many people have such high reward cards with such high limits? Wouldn't it take forever to reach a reward?
I also get the impression that cc experts don't pay of their bill fully each month (but maybe leave a dollar or two)....true?
1st, welcome to the forums
and to answer your question, personally I like high CC limits because I spend a lot!
