topic Re: Artificially Inflated CLs in Credit Cards

Artificially Inflated CLs

Creditdreamer — Wed, 22 Feb 2012 18:13:00 GMT

I am rebuilding and have two secured ccs (CapOne and Open Sky). If I were to raise them to around 3k each (or higher depending on what's available), would it make a difference in the short term? Meaning if I did that, when I then went to apply for a "real" cc, would I be more likely to get a high limit, which would cut out some of the exhaustion of having low CLs for a while on my future better cards? For example, say I leave my limits where they are: 200 and 200. When I then apply for a normal cc, I'd assume I'd get around 200 or 300 limit. If I were to artificially inflate my CLs to that 3k, would that then give me a CL on the future card of around 2 or 3k? Anyone have experience with doing either one?

Thanks!

Re: Artificially Inflated CLs

Anonymous — Wed, 22 Feb 2012 18:58:23 GMT

Better make one 5K and the other 1k. You could have a short cut to visa signature or MC world as lenders usually determine CL size base on your existing TLs. And many times, they will match with the highest one in credit report.

Re: Artificially Inflated CLs

namvet — Wed, 22 Feb 2012 19:06:51 GMT

@Creditdreamer wrote:
I am rebuilding and have two secured ccs (CapOne and Open Sky). If I were to raise them to around 3k each (or higher depending on what's available), would it make a difference in the short term? Meaning if I did that, when I then went to apply for a "real" cc, would I be more likely to get a high limit, which would cut out some of the exhaustion of having low CLs for a while on my future better cards? For example, say I leave my limits where they are: 200 and 200. When I then apply for a normal cc, I'd assume I'd get around 200 or 300 limit. If I were to artificially inflate my CLs to that 3k, would that then give me a CL on the future card of around 2 or 3k? Anyone have experience with doing either one?

Thanks!

Yes! But i would get some payment history before apping for your next card. You know the drill.....pay on time and charge less than 30% of your credit line.

Re: Artificially Inflated CLs

Creditdreamer — Wed, 22 Feb 2012 19:09:57 GMT

That's a good way to look at it. I just checked the CapOne and Open Sky websites and the max for each is 3k. Should I just do 3 and 3? Or should I try opening up another secured and going higher? Or should I do the 3 and 3 and then apply for an unsecured CapOne at the 6 month mark?

Re: Artificially Inflated CLs

Creditdreamer — Wed, 22 Feb 2012 19:16:40 GMT

@ namvet: Okay. Thanks for the advice. I have had my CapOne since October and the Open Sky is fairly new (within last month). Should I wait for 6 months history on both (meaning I'd have 10 months on CapOne)?

Edit: Basically I'm okay with waiting and having the 6k locked down, but I want it to do the most possible good for the time it's locked down. Like if it's going to make an exponential difference between 6 and 12 months, I'll just wait the 12 months.

Re: Artificially Inflated CLs

MarineVietVet — Wed, 22 Feb 2012 19:15:32 GMT

@namvet wrote:

Yes! But i would get some payment history before apping for your next card. You know the drill.....pay on time and charge less than 30% of your credit line.

You can charge as much as you want. It's the reported balance on your statement that is the important number.

Re: Artificially Inflated CLs

Creditdreamer — Wed, 22 Feb 2012 19:19:27 GMT

@ MarineVietVet: Thanks for the clarification. Yes I've been doing that. Because my limit is currently only 200, I end up making 4-5 payments a month to keep it under 30% when the statement closes but that way I don't have to worry about NSF from using my debit card.

Re: Artificially Inflated CLs

Anonymous — Wed, 22 Feb 2012 19:30:06 GMT

I used 3 secured cards to rebuild.

PSB ($1000)

HSBC ($1100)

Capital One ($2200 + $300 Usecured at 6 months ).

I used the cards a lot, to the limit at times, and kept them about 1.5 years, then applied for unsecured before closing the secured.

Capital One approved me for a $3000 cash rewards card, which just went to $3500 (at 6 months on its own). The CSR said they were impressed with the deposit and that helped get the $3000.

HSBC gave me a Household (2% rewards, No AF) with $500 limit, which as not gone up (7 months).

I think it helped me get Target ($1000 CL) which is the first unsecured card I got when I had the first 2 cards only. Other store limts were $500, $800, $2000, $5400.

So in my case, it definitely helped for Captial One and other store cards. but not HSBC.

My deposits limits were not artificial, so if you get a big limit but don't use it, that may not help as much.

I am a believer, and if it doesn't work, no harm done and there is no cost to a bigger deposit, if you have the savings. .

Re: Artificially Inflated CLs

improvingmycredit — Wed, 22 Feb 2012 19:31:01 GMT

Hey!

I think really you would just need at least one at 3K since that's the max for the your secured card or open another secured card at a CU and start the balance at 6K. Most lenders try to match your highest credit limits. YMMV though. This is just my experience so far with my personal cards.

Re: Artificially Inflated CLs

namvet — Wed, 22 Feb 2012 19:40:54 GMT

@rCreditdreamer wrote:
@ namvet: Okay. Thanks for the advice. I have had my CapOne since October and the Open Sky is fairly new (within last month). Should I wait for 6 months history on both (meaning I'd have 10 months on CapOne)?

Edit: Basically I'm okay with waiting and having the 6k locked down, but I want it to do the most possible good for the time it's locked down. Like if it's going to make an exponential difference between 6 and 12 months, I'll just wait the 12 months.

Ok lets think about this and come up with a game plan. Let's not get anymore inq than necessary. You got 3 with the Cap One and none with Open Sky. So you have 4 months history with Cap and none with Open Sky. Getting a new secured card will just add another inq so lets just add to what you already have. Now you will have to be patient and get some history at the higher limits. So my suggestion is to show some good, no great payment history the rest of this year. Let's do this right from the get go. 2013 will be your year. No more secured credit cards for you. Do your research and apply for unsecured for a card that fits your credit profile at the time. Good luck!

Re: Artificially Inflated CLs

Anonymous — Wed, 22 Feb 2012 19:43:39 GMT

IMO, If you have to pay 4 to 5 times a month, then you CL is too low and a 3K limit is more representative of your spending and not artifical.

I suggest you take the Captial One limit to a high number a few months before you apply for unsecured with them.

If the Open Sky the card that used to be Public Savings Bank. I would put a bigger deposit with them, they are problamatic before the bank failure. I think one high limit secured card is enough, and do it with a company that you want to continue with. .

Re: Artificially Inflated CLs

namvet — Wed, 22 Feb 2012 19:46:02 GMT

@MarineVietVet wrote:
@namvet wrote:

Yes! But i would get some payment history before apping for your next card. You know the drill.....pay on time and charge less than 30% of your credit line.
You can charge as much as you want. It's the reported balance on your statement that is the important number.
This is true but i was assuming the balance would be paid off at statement date (or before). Over charging (as you know my brother) can lead to problems for those that are new to credit. Semper Fi

Re: Artificially Inflated CLs

Creditdreamer — Wed, 22 Feb 2012 20:05:52 GMT

@ Wolf3: Thanks for the info on your experience. That's what I was hoping. Sounds like CapOne is the best to lock up the money with.

Re: Artificially Inflated CLs

Creditdreamer — Wed, 22 Feb 2012 20:11:10 GMT

@ namvet: I'm so excited! I have a game plan! My plan was no more secured cards and I will have absolutely spot on payment history for the rest of the year. Figured I'd garden until the beginning of next year. I'm also paying off (and will have paid off) my remaining collections as of next month. I wanted to get the cc history buildling while I earned enough to pay off the debts. 2013 will be my year! Yay!

Re: Artificially Inflated CLs

Creditdreamer — Wed, 22 Feb 2012 20:17:14 GMT

@ MarineVietVet and namvet: In regards to the balance charging to only 30%, if I have a higher limit I will only end up charging 30% total (or less) but with the limit I have now, I have been having to pay multiple times to keep it under that recommended amount for when the statement closes. I understand what both of you meant in that respect. I'm a little bit psycho and analytical when it comes to money and calcs, so I actually enjoy charging and then paying it down to a specific number. It's like a game. Lol. For people who don't enjoy it like I do, they'd be better off only charging less than 30% in the first place.

Re: Artificially Inflated CLs

Creditdreamer — Wed, 22 Feb 2012 20:18:35 GMT

@ improvingmycredit: Thanks for the info!

Re: Artificially Inflated CLs

Creditdreamer — Wed, 22 Feb 2012 20:30:22 GMT

So here's my plan based on multiple sources on here for advice: I'm going to go and get a $3000 secured loan from someone who reports to all three CBs. I will then take the money that I get from the secured loan (my money essentially but will add another positive TL) and put that into CapOne and then maybe put only 2k onto Open Sky (maybe another secured loan, yea or nay?) and then I will keep this with excellent payment history (charging under 30% when the statement closes and PIF each month). Then I will app for cards that will suit my credit and needs at the beginning of 2013 (maybe February to make Open Sky one year old?).

Sound good? Thoughts?

Re: Artificially Inflated CLs

Anonymous — Wed, 22 Feb 2012 20:30:51 GMT

During rebuilding, my utilization was using higher, 50 to 80% on major cards. I took it to 30% when I applied for unsecured Capital One and Household and then let if go back up to make use of 0% APR for 9 months. I only worry about utilization at app time.

Re: Artificially Inflated CLs

Creditdreamer — Wed, 22 Feb 2012 23:47:42 GMT

Do they look at current util or total util over a period?

Also, does anyone know if the last payment made makes much of a difference? Like score wise or lender wise? As in does it look the same to have 3 20 dollar payments as it would to have one 60 dollar payment? Because the "last payment" would be 20 vs. 60.

Re: Artificially Inflated CLs

namvet — Thu, 23 Feb 2012 00:18:11 GMT

@drCreditdreamer wrote:
Do they look at current util or total util over a period?

Also, does anyone know if the last payment made makes much of a difference? Like score wise or lender wise? As in does it look the same to have 3 20 dollar payments as it would to have one 60 dollar payment? Because the "last payment" would be 20 vs. 60.

Current util (statement balance) is what matters Creditdreamer. You can charge all you want like Marine Viet Vet said but when it comes to statement time, pay it down to a reasonable level. I like 30% just to pick a number but less is always better. Good luck with your plan and keep us posted on your way to the 700 club.