topic Re: Applying for Credit Limit Increase, Should Pay Balance First? in Credit Cards

Applying for Credit Limit Increase, Should Pay Balance First?

Shreado — Fri, 05 May 2023 00:42:14 GMT

I would like to know whether it is better to pay down a credit card balance, where one exists, prior to applying for a credit limit increase on a credit card.

It has been my impression that a credit limit increase request to a creditor is best when the credit card that one is applying for a credit limit increase does not have a balance and that balance is treated adversely in the decision making process by the creditor.

What are your thoughts?

Re: Applying for Credit Limit Increase, Should Pay Balance First?

Legally_Speaking2512 — Fri, 05 May 2023 00:49:25 GMT

It may do better to pay your balance down first depending on how high it is. A lower credit utilization is always ideal in my opinion.

Re: Applying for Credit Limit Increase, Should Pay Balance First?

pinkandgrey — Fri, 05 May 2023 01:09:58 GMT

There's no way to say for sure. I've requested CLIs while carrying a substantial balance (Discover) and been successful. I've also requested shortly after paying off the entire balance. I think it depends a lot on the issuer and your particular history with said issuer.

I'm sure, though, that very few lenders (if any) would grant a CLI if you're carrying a 90% balance or something crazy like that lol.

Re: Applying for Credit Limit Increase, Should Pay Balance First?

NoMoreE46 — Fri, 05 May 2023 02:32:41 GMT

Paying the balance down to under a percentage like 10 % would be better imo.

In the cases of 0% interest, the lender has no literal interest to gain by allowing a higher CL if one's balance is too high.

Re: Applying for Credit Limit Increase, Should Pay Balance First?

SouthJamaica — Fri, 05 May 2023 02:44:21 GMT

@Shreado wrote:
I would like to know whether it is better to pay down a credit card balance, where one exists, prior to applying for a credit limit increase on a credit card.

It has been my impression that a credit limit increase request to a creditor is best when the credit card that one is applying for a credit limit increase does not have a balance and that balance is treated adversely in the decision making process by the creditor.

What are your thoughts?

As long as the balance isn't excessive, I don't think it matters.

Re: Applying for Credit Limit Increase, Should Pay Balance First?

isik — Fri, 05 May 2023 03:40:08 GMT

In theory it feels like it should matter, but I didn't notice it affecting me. Most recent example is I just got a 3X increase with Amex with $700 (23%) utilization with also $2k on a NPSL card. I also had good luck with BofA while carrying 0% APR balances.

Re: Applying for Credit Limit Increase, Should Pay Balance First?

SUPERSQUID — Fri, 05 May 2023 05:46:17 GMT

@Shreado wrote:
I would like to know whether it is better to pay down a credit card balance, where one exists, prior to applying for a credit limit increase on a credit card.

It has been my impression that a credit limit increase request to a creditor is best when the credit card that one is applying for a credit limit increase does not have a balance and that balance is treated adversely in the decision making process by the creditor.

What are your thoughts?

Great question,

In my case it never mattered however I think if you keep a reasonably low balance and a perfect payment history its more likely you will be approved than otherwise. Lenders may look at other factors in your reports such as your behavior overall with other lenders, balances, payment history, baddies, income etc.

In my case every card in my siggy has given me a cli while carrying a balance, however I kept my balances below 30 pct and always paid at least 2 times the minimum and sometimes pif weeks ahead of due date.

Re: Applying for Credit Limit Increase, Should Pay Balance First?

masscredit — Sat, 06 May 2023 16:48:27 GMT

And when it comes to potential increases, does it matter if you let a high balance post when the statement closes? Or is having that balance then paying it off before the statement closes the same? I have a couple cards that I'd like to see grow. They have been getting a lot of use lately with current balances in the 66-85% range. I rather them that high when the statement closes. I know, don't chase FICO but...