topic Big limits but how much do you use? in Credit Cards

Big limits but how much do you use?

Anonymous — Mon, 03 Jun 2013 19:05:15 GMT

My credit limits have been climbing over the past few weeks. Just out of curiousity, how close do you get to your limits. On my amex's I run 500/600 a month. On my other cards its a couple hundred here and there. I'm starting to feel silly for asking for more when I don't use what I have. I know I just like to watch them climb and for utility purposes but won't creditors start asking questions or lower you limit when you don't use it all?

Re: Big limits but how much do you use?

_jb_ — Mon, 03 Jun 2013 19:21:01 GMT

Eventually you will start hearing "you have enough credit" and getting denied new cards. I definitely have more credit than I need right now at $50-55k, but there are a couple cards that I still want. I would rather have a smaller number of cards with higher limits than a bunch of cards with lower limits, so I will probably drop or PC 1-2 cards when I pick up the last couple that I want, just to keep from looking overextended.

Re: Big limits but how much do you use?

Anonymous — Mon, 03 Jun 2013 19:26:08 GMT

@Anonymous wrote:
My credit limits have been climbing over the past few weeks. Just out of curiousity, how close do you get to your limits. On my amex's I run 500/600 a month. On my other cards its a couple hundred here and there. I'm starting to feel silly for asking for more when I don't use what I have. I know I just like to watch them climb and for utility purposes but won't creditors start asking questions or lower you limit when you don't use it all?

It's all about utilization. I asked for 11K on my NFCU. I'm never going to get close to that, so it's a win-win. I can keep my util on that card below 10% and I can feel safe knowing that in the event a true emergency pops up, I can have that "cushion" in case I need it. Don't be worried about asking for CLI, as long as you pay it back and don't just ask to run up more charges and then only give min payments. Plus, the CC companies know what your limit is comensurate to your income and exposure with them, so they will just decline or counter-offer (e.g. NFCU or AMEX) what they feel comfortable... when you make more money, or demonstrate more credit history, then they'll bump you again.

Re: Big limits but how much do you use?

NonSufficientFunds — Mon, 03 Jun 2013 19:39:19 GMT

Ther are times when having "too much" available credit can work against you (especially immediately after securing a new mortgage).

But most creditors are only concerned when you have attained an inordinate amount of new credit in an unusually short amount of time.

The scoring models are able to track a consumer's behavior, and will raise red-flags when they see something that doesn't jive with typical consumer spending patterns.

These alerts can signal an increased likelihood that a consumer will file for bankruptcy within the next 24 months, which might cause a creditor to reduce limits, close the account, or request extra financial documentation.

Re: Big limits but how much do you use?

Anonymous — Mon, 03 Jun 2013 19:35:44 GMT

@_jb_ wrote:
Eventually you will start hearing "you have enough credit" and getting denied new cards.

Yes, and can happen either with a new issuer (so your app gets denied), or because an issuer decides you have enough credit already with them. In the latter case, depending on the issuer, you may be able to move some of a credit limit from an older card to the new card, giving you the new card but not increasing exposure for the lender.

At a certain point, the value of decreased utilization becomes vanishingly small, I use about 0.1% of my total CL so adding more isn't going to usefully change things.

Re: Big limits but how much do you use?

CreditScholar — Tue, 04 Jun 2013 06:48:26 GMT

@Anonymous wrote:
@_jb_ wrote:
Eventually you will start hearing "you have enough credit" and getting denied new cards.
Yes, and can happen either with a new issuer (so your app gets denied), or because an issuer decides you have enough credit already with them. In the latter case, depending on the issuer, you may be able to move some of a credit limit from an older card to the new card, giving you the new card but not increasing exposure for the lender.

At a certain point, the value of decreased utilization becomes vanishingly small, I use about 0.1% of my total CL so adding more isn't going to usefully change things.

+1. This about sums it up.

Re: Big limits but how much do you use?

HiLine — Tue, 04 Jun 2013 15:29:26 GMT

My monthly expense rarely ever exceeds 5% of my current total CL... I do think that I have enough credit and likely only will be asking for CLI's on my sub-5k Amex cards.

Re: Big limits but how much do you use?

codimom — Tue, 04 Jun 2013 15:42:19 GMT

I use less than 1% of my available credit. I have 5 cards in my rotation (although I just re-sockdrawered my citi card) with good* limits . I hope I never get close to my 18k limit on my bce, but i like knowing its there. (* okay, target is not a 'good' limit, but it is sufficient and i use it weekly). On the others in the drawer, i tend to put someting like netflix or my nook account on one of those to keep them active.

Re: Big limits but how much do you use?

Anonymous — Tue, 04 Jun 2013 16:25:17 GMT

I have more than I use (by a factor of about 10) at any given time, but far less than I want.

Re: Big limits but how much do you use?

andre181 — Tue, 04 Jun 2013 16:32:51 GMT

I've had the balance on my FNBO card up to $9,000 but that was after paying off my car loan with it via balance transfer. That is by far the biggest balance I've had on a CC. Lately, the cards I use the most only get a few hundred dollars pushed through them every month. There was a period where I was spending around $2k/month on Discover but I've drastically reduced my spending recently because of certain circumstances (trying to save money for an impending move and new career).

Re: Big limits but how much do you use?

revvystoke — Tue, 04 Jun 2013 17:31:31 GMT

I never app'd too much in the past for new cards, I usually saved for a new car each year but decided to skip it this year. Since I didn't have any big purchases planned I figured I could waste some inq's. I run 3-4k through my cards each month, plus whatever expenses come for work that I am reimbursed for. It sucked always bumping close to the limits on whatever card I was using so the other cards with 5k+ limits helped in that regard. I pif and it is annoying always having to pay every few thousand to keep using the card, much easier to have higher limits and pif at the end of every other week vs every few days.

Re: Big limits but how much do you use?

Bay_Area_Joe — Tue, 04 Jun 2013 17:58:05 GMT

In my case, I have my girl friend as an AU on my Marriott card and she pushes about 2k a month thru. I have a son in college, that I pay all his expenses possible on a credit card, then take money from his 529 to pay the credit card, that is about 12k a year, and for me, about 2k month, then my business does about 4k a month.

I rarley ever go above 3% of my lines combines. But I have tons of credit.

Re: Big limits but how much do you use?

HiLine — Tue, 04 Jun 2013 19:19:00 GMT

@revvystoke wrote:
I never app'd too much in the past for new cards, I usually saved for a new car each year but decided to skip it this year. Since I didn't have any big purchases planned I figured I could waste some inq's. I run 3-4k through my cards each month, plus whatever expenses come for work that I am reimbursed for. It sucked always bumping close to the limits on whatever card I was using so the other cards with 5k+ limits helped in that regard. I pif and it is annoying always having to pay every few thousand to keep using the card, much easier to have higher limits and pif at the end of every other week vs every few days.

I'm surprised the banks haven't increased your credit limit already. Have you tried requesting a CLI with BofA yet?

Re: Big limits but how much do you use?

sccredit — Tue, 04 Jun 2013 20:59:09 GMT

I have been averaging less than 10% of my limits each month, then PIF. That should be trending down now that most of the work on the house is complete but I am sure it will go back up with the next project.

Re: Big limits but how much do you use?

Razeus — Tue, 04 Jun 2013 21:22:52 GMT

Holy crap, $100k+ worth of credit cards?

Re: Big limits but how much do you use?

HiLine — Tue, 04 Jun 2013 22:47:49 GMT

@Razeus wrote:
Holy crap, $100k+ worth of credit cards?

Welcome to MyFICO, Razeus!