cancel
Showing results for 
Search instead for 
Did you mean: 

How much do existing CLs influence new CL?

tag
-NewGuy-
Moderator Emeritus

How much do existing CLs influence new CL?

I was just curious how much impact your existing credit limits have when determining a new credit limit for a brand new account? While I'm sure this varies between lenders, it would seem logical that a lender would be more willing to extend you a higher credit limit if another lender had already done so. 

 

I want to app for the new (ish) Arrival Plus, but I am thinking that I should wait until my new 3x CLI posts to my TU report.

Message 1 of 12
11 REPLIES 11
PlasticOrPlastic
Established Contributor

Re: How much do existing CLs influence new CL?


@-NewGuy- wrote:

I was just curious how much impact your existing credit limits have when determining a new credit limit for a brand new account? While I'm sure this varies between lenders, it would seem logical that a lender would be more willing to extend you a higher credit limit if another lender had already done so. 

 

I want to app for the new (ish) Arrival Plus, but I am thinking that I should wait until my new 3x CLI posts to my TU report.


1st I'd have to say there is no "logic" in the credit world.  I don't think other lenders care much about your other limits, at least the lenders I utilize.  Discover pretty much told me they dont base their decisions on other cards in my profile.  Barclay raised me up to 5k limit based solely on my relationship with them. 

Message 2 of 12
-NewGuy-
Moderator Emeritus

Re: How much do existing CLs influence new CL?


@EndlessRoad wrote:

@-NewGuy- wrote:

I was just curious how much impact your existing credit limits have when determining a new credit limit for a brand new account? While I'm sure this varies between lenders, it would seem logical that a lender would be more willing to extend you a higher credit limit if another lender had already done so. 

 

I want to app for the new (ish) Arrival Plus, but I am thinking that I should wait until my new 3x CLI posts to my TU report.


1st I'd have to say there is no "logic" in the credit world.  I don't think other lenders care much about your other limits, at least the lenders I utilize.  Discover pretty much told me they dont base their decisions on other cards in my profile.  Barclay raised me up to 5k limit based solely on my relationship with them. 


I hear you, and Chase has always treated me according to my relationship with them solely it woud seem. However, lets take two fictional people apping for a card. Both have the exact same credit profile, income, same hairstyle, same favorite color, etc. They both have three cards. However, person 1's CLs are 5K across the board, and person 2's CLS are 5K, 5K and 20K. Is that 20K limit going to get the second person a higher limit on approval?

Message 3 of 12
longtimelurker
Epic Contributor

Re: How much do existing CLs influence new CL?


@-NewGuy- wrote:

@EndlessRoad wrote:

@-NewGuy- wrote:

I was just curious how much impact your existing credit limits have when determining a new credit limit for a brand new account? While I'm sure this varies between lenders, it would seem logical that a lender would be more willing to extend you a higher credit limit if another lender had already done so. 

 

I want to app for the new (ish) Arrival Plus, but I am thinking that I should wait until my new 3x CLI posts to my TU report.


1st I'd have to say there is no "logic" in the credit world.  I don't think other lenders care much about your other limits, at least the lenders I utilize.  Discover pretty much told me they dont base their decisions on other cards in my profile.  Barclay raised me up to 5k limit based solely on my relationship with them. 


I hear you, and Chase has always treated me according to my relationship with them solely it woud seem. However, lets take two fictional people apping for a card. Both have the exact same credit profile, income, same hairstyle, same favorite color, etc. They both have three cards. However, person 1's CLs are 5K across the board, and person 2's CLS are 5K, 5K and 20K. Is that 20K limit going to get the second person a higher limit on approval?


In an ideal world, it shouldn't.  An underwriter is responsible to protect against risky loans.  Each issuer would evaluate on credit profile and the bank's evaluation of risk.  So in theory, if bank X gave a customer $20K, and bank Y evaluates the customer as borderline, then X's (foolish!) decision shouldn't impact Y's decision.

 

Against that, apart from risk, the customer should also be profitable.   And it might be that bank Y, having decided to issue the card, thinks that if they give the "justified' $5K limit, the card might not see much use, and so may increase the CL to a higher value (presumably still with acceptable risk).

 

But here you will read Bank A "always" matches limits, oh so does Bank B, and Bank C etc.  IMO, these are artifacts, possibly confusing cause with effect.   When Bank A gives a $20K CL, it is because of factors in the credit report (and maybe some relationship stuff).   Bank B may make the same type of decision, NOT because of the CL from A, but because they are basing it on the same report.

 

But people like to see patterns.   I think for every Bank A matches story, there are at least as many counterexamples!

 

Message 4 of 12
mongstradamus
Super Contributor

Re: How much do existing CLs influence new CL?


@longtimelurker wrote:

@-NewGuy- wrote:

@EndlessRoad wrote:

@-NewGuy- wrote:

I was just curious how much impact your existing credit limits have when determining a new credit limit for a brand new account? While I'm sure this varies between lenders, it would seem logical that a lender would be more willing to extend you a higher credit limit if another lender had already done so. 

 

I want to app for the new (ish) Arrival Plus, but I am thinking that I should wait until my new 3x CLI posts to my TU report.


1st I'd have to say there is no "logic" in the credit world.  I don't think other lenders care much about your other limits, at least the lenders I utilize.  Discover pretty much told me they dont base their decisions on other cards in my profile.  Barclay raised me up to 5k limit based solely on my relationship with them. 


I hear you, and Chase has always treated me according to my relationship with them solely it woud seem. However, lets take two fictional people apping for a card. Both have the exact same credit profile, income, same hairstyle, same favorite color, etc. They both have three cards. However, person 1's CLs are 5K across the board, and person 2's CLS are 5K, 5K and 20K. Is that 20K limit going to get the second person a higher limit on approval?


In an ideal world, it shouldn't.  An underwriter is responsible to protect against risky loans.  Each issuer would evaluate on credit profile and the bank's evaluation of risk.  So in theory, if bank X gave a customer $20K, and bank Y evaluates the customer as borderline, then X's (foolish!) decision shouldn't impact Y's decision.

 

Against that, apart from risk, the customer should also be profitable.   And it might be that bank Y, having decided to issue the card, thinks that if they give the "justified' $5K limit, the card might not see much use, and so may increase the CL to a higher value (presumably still with acceptable risk).

 

But here you will read Bank A "always" matches limits, oh so does Bank B, and Bank C etc.  IMO, these are artifacts, possibly confusing cause with effect.   When Bank A gives a $20K CL, it is because of factors in the credit report (and maybe some relationship stuff).   Bank B may make the same type of decision, NOT because of the CL from A, but because they are basing it on the same report.

 

But people like to see patterns.   I think for every Bank A matches story, there are at least as many counterexamples!

 


This is an really interesting topic, i am really wondering if my discover low limited effected my average CL i got from Chase when i appled for CSP. My discover is 1/4 at least CL of every other card i have. The more i think about the more i want to find out if i can close this discover card and apply for new one so i can get an better CL. My reasoning is my EQ has an lot less inq than my TU does . 



EX Fico 804 11/16/16 Fako 800 Credit.com 11/16/16
EQ SW bank enhanced 11/16/16 839 CK fako 822 11/16/16
TU Fico discover 10/19/16 814 Fako 819 Creditkarma 11/16/16
Message 5 of 12
-NewGuy-
Moderator Emeritus

Re: How much do existing CLs influence new CL?


@longtimelurker wrote:

@-NewGuy- wrote:

@EndlessRoad wrote:

@-NewGuy- wrote:

I was just curious how much impact your existing credit limits have when determining a new credit limit for a brand new account? While I'm sure this varies between lenders, it would seem logical that a lender would be more willing to extend you a higher credit limit if another lender had already done so. 

 

I want to app for the new (ish) Arrival Plus, but I am thinking that I should wait until my new 3x CLI posts to my TU report.


1st I'd have to say there is no "logic" in the credit world.  I don't think other lenders care much about your other limits, at least the lenders I utilize.  Discover pretty much told me they dont base their decisions on other cards in my profile.  Barclay raised me up to 5k limit based solely on my relationship with them. 


I hear you, and Chase has always treated me according to my relationship with them solely it woud seem. However, lets take two fictional people apping for a card. Both have the exact same credit profile, income, same hairstyle, same favorite color, etc. They both have three cards. However, person 1's CLs are 5K across the board, and person 2's CLS are 5K, 5K and 20K. Is that 20K limit going to get the second person a higher limit on approval?


In an ideal world, it shouldn't.  An underwriter is responsible to protect against risky loans.  Each issuer would evaluate on credit profile and the bank's evaluation of risk.  So in theory, if bank X gave a customer $20K, and bank Y evaluates the customer as borderline, then X's (foolish!) decision shouldn't impact Y's decision.

 

Against that, apart from risk, the customer should also be profitable.   And it might be that bank Y, having decided to issue the card, thinks that if they give the "justified' $5K limit, the card might not see much use, and so may increase the CL to a higher value (presumably still with acceptable risk).

 

But here you will read Bank A "always" matches limits, oh so does Bank B, and Bank C etc.  IMO, these are artifacts, possibly confusing cause with effect.   When Bank A gives a $20K CL, it is because of factors in the credit report (and maybe some relationship stuff).   Bank B may make the same type of decision, NOT because of the CL from A, but because they are basing it on the same report.

 

But people like to see patterns.   I think for every Bank A matches story, there are at least as many counterexamples!

 


This is how I've felt for the most part too. I haven't noticed my credit card approvals to be influenced one way or the other by existing CL of other cards. But you always read about it. I know a popular one is that Chase likes to see an existing 5K CL before issuing a CSP.

Message 6 of 12
mongstradamus
Super Contributor

Re: How much do existing CLs influence new CL?


@-NewGuy- wrote:

@longtimelurker wrote:

@-NewGuy- wrote:

@EndlessRoad wrote:

@-NewGuy- wrote:

I was just curious how much impact your existing credit limits have when determining a new credit limit for a brand new account? While I'm sure this varies between lenders, it would seem logical that a lender would be more willing to extend you a higher credit limit if another lender had already done so. 

 

I want to app for the new (ish) Arrival Plus, but I am thinking that I should wait until my new 3x CLI posts to my TU report.


1st I'd have to say there is no "logic" in the credit world.  I don't think other lenders care much about your other limits, at least the lenders I utilize.  Discover pretty much told me they dont base their decisions on other cards in my profile.  Barclay raised me up to 5k limit based solely on my relationship with them. 


I hear you, and Chase has always treated me according to my relationship with them solely it woud seem. However, lets take two fictional people apping for a card. Both have the exact same credit profile, income, same hairstyle, same favorite color, etc. They both have three cards. However, person 1's CLs are 5K across the board, and person 2's CLS are 5K, 5K and 20K. Is that 20K limit going to get the second person a higher limit on approval?


In an ideal world, it shouldn't.  An underwriter is responsible to protect against risky loans.  Each issuer would evaluate on credit profile and the bank's evaluation of risk.  So in theory, if bank X gave a customer $20K, and bank Y evaluates the customer as borderline, then X's (foolish!) decision shouldn't impact Y's decision.

 

Against that, apart from risk, the customer should also be profitable.   And it might be that bank Y, having decided to issue the card, thinks that if they give the "justified' $5K limit, the card might not see much use, and so may increase the CL to a higher value (presumably still with acceptable risk).

 

But here you will read Bank A "always" matches limits, oh so does Bank B, and Bank C etc.  IMO, these are artifacts, possibly confusing cause with effect.   When Bank A gives a $20K CL, it is because of factors in the credit report (and maybe some relationship stuff).   Bank B may make the same type of decision, NOT because of the CL from A, but because they are basing it on the same report.

 

But people like to see patterns.   I think for every Bank A matches story, there are at least as many counterexamples!

 


This is how I've felt for the most part too. I haven't noticed my credit card approvals to be influenced one way or the other by existing CL of other cards. But you always read about it. I know a popular one is that Chase likes to see an existing 5K CL before issuing a CSP.


I heard that also , but i didn't have any non au accounts that were above 10k , my freedom and BCP are only 4.5k and when i apped for CSP they gave me 9k which is pretty decent. Hopefully they wont be a pain in the neck giving me auto cli, like discover has been. 



EX Fico 804 11/16/16 Fako 800 Credit.com 11/16/16
EQ SW bank enhanced 11/16/16 839 CK fako 822 11/16/16
TU Fico discover 10/19/16 814 Fako 819 Creditkarma 11/16/16
Message 7 of 12
MidnightJester
Frequent Contributor

Re: How much do existing CLs influence new CL?

It seems to matter to some point for sure. Just how much. I am purposely pushing my app spree off 3-6 weeks so I can ask discover for another CLI and hopfully get to 10K plus with my discover limit so other cards might "MIGHT" give me better limits. YMMV is definately in this belief.

 

I will say I am pretty sure if you qualify for both FREEDOM and CSP you will get a inital higher CL with the CSP then then FREEDOM if you were to choose between the 2 to apply to. Some people have gotten higher Freedom limits to start but I think they try to get you to spend more with the CSP then the FREEDOM

Message 8 of 12
takeshi74
Senior Contributor

Re: How much do existing CLs influence new CL?


@-NewGuy- wrote:

I was just curious how much impact your existing credit limits have when determining a new credit limit for a brand new account?


There's no simple and direct relationship though utilization (limits are factored into util) certainly plays a significant role in general with assessing credit.

 

Plus underwriting varies by creditor so that will also affect how much a given creditor is willing to extend.

 


@-NewGuy- wrote:

it would seem logical that a lender would be more willing to extend you a higher credit limit if another lender had already done so. 


It's logical only if you assume no other impact from other factors but there are many other variables at play.  I had a $30K limit card when Discover granted me a $4.5K limit.  There are those that have received much higher limits from Discover without having higher limit cards for Discover to match (I'm not asserting that they or any other creditor matches).  Again, the relationships between such things and the causality isn't quite so direct as you're making it out to be.  Higher limits can help but they're also not a guarantee.

 


@-NewGuy- wrote:

However, lets take two fictional people apping for a card. Both have the exact same credit profile, income, same hairstyle, same favorite color, etc. They both have three cards. However, person 1's CLs are 5K across the board, and person 2's CLS are 5K, 5K and 20K. Is that 20K limit going to get the second person a higher limit on approval?


Credit profiles wouldn't be identical if available credit wasn't identical.  Keep this in mind:

http://www.myfico.com/crediteducation/whatsinyourscore.aspx

 

Again, it's not just a matter of limits (or any other factor on its own).

 


@longtimelurker wrote:
But people like to see patterns.

Few seem to have a good grasp of causality.  I'm not saying I'm a master of it though it's very useful in my line of work.  I've definitely made mistaken assumptions myself.

Message 9 of 12
withaspark
Contributor

Re: How much do existing CLs influence new CL?


@longtimelurker wrote:

In an ideal world, it shouldn't.  An underwriter is responsible to protect against risky loans.  Each issuer would evaluate on credit profile and the bank's evaluation of risk.  So in theory, if bank X gave a customer $20K, and bank Y evaluates the customer as borderline, then X's (foolish!) decision shouldn't impact Y's decision.

 

Against that, apart from risk, the customer should also be profitable.   And it might be that bank Y, having decided to issue the card, thinks that if they give the "justified' $5K limit, the card might not see much use, and so may increase the CL to a higher value (presumably still with acceptable risk).

 

But here you will read Bank A "always" matches limits, oh so does Bank B, and Bank C etc.  IMO, these are artifacts, possibly confusing cause with effect.   When Bank A gives a $20K CL, it is because of factors in the credit report (and maybe some relationship stuff).   Bank B may make the same type of decision, NOT because of the CL from A, but because they are basing it on the same report.

 

But people like to see patterns.   I think for every Bank A matches story, there are at least as many counterexamples!

 


Well said.

Message 10 of 12
Advertiser Disclosure: The offers that appear on this site are from third party advertisers from whom FICO receives compensation.