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JJF
Posts: 101
Registered: ‎03-23-2009
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Individual Credit Card Limits, Total OC Limits and Total Available Credit vs Income

When I applied for an Amazon VISA card (a few years ago), I was turned down on-line.  A few days later, I got a call from Chase telling me the reason I was turned down was I had adequate credit from Chase.  If I wanted then they would approve the Chase Amazon VISA for whatever limit I wanted as long as they reduced my other Chase card by the same amount.  I decided on a Chase Amazon  card with a $2,000 limit.

 

I recently got DENIED for a Barclay's card but they did not offer me the opportunity to move credit from one card to another.

 

Is their any logic,pattern or model to the amount of credit on a specific card versus the total credit on all cards for a specific creditor?  I got an Orvis VISA card because they were offering a promo cash discount.  It got approved for $10,000 then got closed last year due to inactivity.  Since Chase gave me a new $10k card does this suggest that if I called and asked for a CLI for my Chase Amazon card that I might have been given a $10k increase?  As a general rule, is it easier to get a CLI or a new branded card?  (Trivia, two months after Chased closed my Orvis card they approved me for a Disney card with a $4,600 limit.)

 

For an individual creditor (ie Chase, Citibank, USAA, Discover, etc), for a consumer who usually PIF with a 0% to 1% utilization what is considered a good individual card limit ?  combined or total credit limit across all cards issued by that creditor?  (I assume the credit limit is usually based somewhat on income?)

 

As my utilization has decreased my automatic CLI's have disappeared.  As my income increased my total credit remained constant so my total credit/income decreased.  In order to avoid AA what is considered a safe total available credit limit to income ratio?

 

Thanks

 

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haulingthescoreup
Posts: 28,115
Registered: ‎04-01-2007
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Re: Individual Credit Card Limits, Total OC Limits and Total Available Credit vs Income

Creditors generally don't keep up with changes in your income, so after you apply and get the card, debt to income is irrelevant.

CLI's are issued for different reasons by different banks. Some ratchet it up automatically, some rarely do so. They generally like to see lots of usage on the card, and my banks like that I PIF. Starter cards often like it if you carry balances, so that they can make money off of you.

All banks are hurting for money now, and those who have quite high CL's and barely use a fraction are in danger of CLD's, not through any problem on the cardholders' parts, but because the banks need to get the amount of credit that they have extended back under control. They must maintain a certain percentage of cash reserves again the amount of credit extended, so if they don't have a lot of cash on hand, they have to reduce the amount of unused credit floating around.

"Good" individual credit limits depend on what the individual wants. Some folks are perfectly happy with $2000 CL's; others want $5K or $10K or $20K or more. I think it should be $1K or more, as on manual review of your credit, the lower limits can look like other banks don't trust you.
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