topic Re: I just got a new credit card with an abnormal limit of 11k in Credit Cards

I just got a new credit card with an abnormal limit of 11k

Chuck1987 — Tue, 17 Apr 2012 20:45:28 GMT

I signed up for a Discover card to help with buying an iPad 3 and accessories for Mothers Day. Luckily I was approved today. Now I was expecting maybe $1,000 line of credit so I could take advantage of the 0% APR for 15 mths with 9.99% APR after the period and pay off my purchase in 6mths to build credit, but to my utter bewilderment I got 11k!!!!

I'm 24 with a FT job at 65k/yr in the IT field. I normally stay away from credit cards because there's nothing I really want. I plan on moving into an apartment sometime next year and I wanted to have the best possible credit rating before I started looking around. I checked my FICO score from EQ and they quoted me at 703.

I have a Capital One card 6 years old with a $750 limit and $5 membership fee and APR of 23%, I've only recently paid it off last October and I haven't touched it since only to pay the $5.04 a month. I figured another credit card couldn't hurt my chances at bagging a nice apartment without too much hassle. Now I do have a blemish on my credit report for being 90days late once on a store credit card, but that was 2 years ago and I have since closed the account and paid it in full. I also have student loans which I started paying off after two deferments this year.

I initially applied for an AMEX gold and got declined 2 mths ago, but I was approved for the Discover More at 11k! AND they CSRs say that after 6mths I can opt for an increase! To me, from living off of a cash existence, this seems like too much power to wield at one time!! It's quite overwhelming....

My questions are this:

After I buy the gift and pay off the card, should I destroy it or keep it?

My old CapOne card, should I destroy it if I plan to keep the Discover since $11k easily dwarfs $750?

$11,000 seems like it's too much to grant at once in excess, is this normal for a cc company to do or is it my score and history?

Re: I just got a new credit card with an abnormal limit of 11k

ForceMd — Tue, 17 Apr 2012 20:54:46 GMT

In the long run, keeping the Discover with the high limit will benefit you. If you take care of the card (no lates, low utilization/PIF) it will show future lenders that you can handle a generous limit card and other lenders will be more likely to give you similar limit cards in the future. I would say, if you have the discipline, then keep the new Discover and ditch the CapOne (if you are paying $5 a month in fees). Remember to not to view your credit cards as an extension of your income. If you couldn't afford it before the $11k Discover, you still can't afford it.

Oh, and congrats on the new Discover.

Re: I just got a new credit card with an abnormal limit of 11k

Anonymous — Tue, 17 Apr 2012 20:53:29 GMT

After you buy and payoff the gift definitely keep the card. Why would you want to destroy it?

You will still need the Cap 1 since Discover is not universally accepted everywhere and you would need a backup, garden for 6 months with your new discover then start looking at some prime Visa or mastercard cards and continue to move up in the prime world.

11k is a little high for Discover considering your score. My score was 755 when approved for my discover card and my limit is half yours, but with a limit like that and I assume you got one of their cards with no annual fee, definitely keep it. Using credit cards for everything, then paying in full is a good habit to get into.

Re: I just got a new credit card with an abnormal limit of 11k

Anonymous — Tue, 17 Apr 2012 20:57:11 GMT

@Chuck1987 wrote:
I signed up for a Discover card to help with buying an iPad 3 and accessories for Mothers Day. Luckily I was approved today. Now I was expecting maybe $1,000 line of credit so I could take advantage of the 0% APR for 15 mths with 9.99% APR after the period and pay off my purchase in 6mths to build credit, but to my utter bewilderment I got 11k!!!!

I'm 24 with a FT job at 65k/yr in the IT field. I normally stay away from credit cards because there's nothing I really want. I plan on moving into an apartment sometime next year and I wanted to have the best possible credit rating before I started looking around. I checked my FICO score from EQ and they quoted me at 703.

I have a Capital One card 6 years old with a $750 limit and $5 membership fee and APR of 23%, I've only recently paid it off last October and I haven't touched it since only to pay the $5.04 a month. I figured another credit card couldn't hurt my chances at bagging a nice apartment without too much hassle. Now I do have a blemish on my credit report for being 90days late once on a store credit card, but that was 2 years ago and I have since closed the account and paid it in full. I also have student loans which I started paying off after two deferments this year.

I initially applied for an AMEX gold and got declined 2 mths ago, but I was approved for the Discover More at 11k! AND they CSRs say that after 6mths I can opt for an increase! To me, from living off of a cash existence, this seems like too much power to wield at one time!! It's quite overwhelming....

My questions are this:
After I buy the gift and pay off the card, should I destroy it or keep it?
My old CapOne card, should I destroy it if I plan to keep the Discover since $11k easily dwarfs $750?
$11,000 seems like it's too much to grant at once in excess, is this normal for a cc company to do or is it my score and history?

They are betting that you will use up a lot of the limit and then when the 15 mos expires you will not be able ot pay it off. They then make quite a profit. If you trust yourself to not fall into that trap, use the 0% and then keep the card.

Capital One expects you to apply for a better card as some time. Think about if you want to continue with Capital One, if so apply when your credit looks it best. I would not close existing card at this point, since AF is low and I assume you have no other Visa or MC.

Re: I just got a new credit card with an abnormal limit of 11k

pizzadude — Tue, 17 Apr 2012 20:59:06 GMT

Welcome to the forums !! And big congrats on the CL luv from Discover !!

Usually Discover is a fairly conservative lender out of the gate, but since your reports are fairly clean, I guess they didn't see anything that bothered them. Do you have any other negatives or derogatory items on your CRs besides the 90 day late ?

As far as the Cap1 card goes, I would leave it open for the short term until you acquire another CC or two. FICO scoring likes to see at least two or three open revolving accounts. IMO you should be able to get other good cards without AFs once your Discover starts reporting. You might also trying calling Cap1 and asking them to waive your AF ~ some people have had success with this.

Re: I just got a new credit card with an abnormal limit of 11k

Anonymous — Tue, 17 Apr 2012 21:07:22 GMT

Congrats on the Discover card and the credit limit. Discover is a very conservative lender. Usually on average only giving around 7% of your annual salary to new card holders without a BT. They give more for the BT.

TBC

Re: I just got a new credit card with an abnormal limit of 11k

Chuck1987 — Tue, 17 Apr 2012 21:22:38 GMT

They are betting that you will use up a lot of the limit and then when the 15 mos expires you will not be able ot pay it off. They then make quite a profit. If you trust yourself to not fall into that trap, use the 0% and then keep the card.

Oh trust me, I saw this from a mile away! I am quite responsible and I can't see myself spending the max on this card.

Re: I just got a new credit card with an abnormal limit of 11k

frogfan12 — Wed, 18 Apr 2012 01:01:52 GMT

Congrats on the new card! I'd definitely say keep it. It can only help your credit history.

Re: I just got a new credit card with an abnormal limit of 11k

frogfan12 — Wed, 18 Apr 2012 01:02:26 GMT

@Anonymous wrote:
Congrats on the Discover card and the credit limit. Discover is a very conservative lender. Usually on average only giving around 7% of your annual salary to new card holders without a BT. They give more for the BT.

TBC

7% isn't much.

Re: I just got a new credit card with an abnormal limit of 11k

Anonymous — Wed, 18 Apr 2012 01:29:28 GMT

Hey congrate .. I would keep the card don't destroy it.. discover is a good credit..I got my first discover last year December with $1700 Cl with 20% Apr with AF after 3 month payment on time .. they send me a pre-approve letter 15 month 0% Apr purchase / BT and I app got approve for $8k Cl and I was hell yea biggest CL ever .. so now I got 1 or 2 month to go on my first discover card and ask for cli...oh one more thing you could upgrade your card too .. it is cool..love it

Re: I just got a new credit card with an abnormal limit of 11k

Anonymous — Wed, 18 Apr 2012 01:30:55 GMT

Oppss it is No AF on my first discover card... typo

Re: I just got a new credit card with an abnormal limit of 11k

tennisfan78 — Wed, 18 Apr 2012 01:37:14 GMT

Congrats on the awesome limit. Do not consider it as free money, and always pay in full.

I would say keep the Capital one card also.

Re: I just got a new credit card with an abnormal limit of 11k

injustifiiable — Wed, 18 Apr 2012 01:45:13 GMT

Congrats...treat her well and she'll take care of you. :-)

BTW...For what it's worth...you probably could've gotten approved for a Zync...there are plenty of people here who've gotten in with lower scores..

Re: I just got a new credit card with an abnormal limit of 11k

boomhower — Wed, 18 Apr 2012 01:46:28 GMT

Keep the discover, close the CapOne. Then open a second credit card and one store card. You'll take a hit initially for the new accounts but in the end you'll be better off score wise. Three cards is IMHO the min for the best score and a store card will help the credit mix, also increasing score.

Re: I just got a new credit card with an abnormal limit of 11k

SamsungHDTV — Wed, 18 Apr 2012 01:51:40 GMT

congrats on your new card! I can't wait until I'm on that level.