topic Re: If I increase a current CC limit will it affect my credit score? in Understanding FICO® Scoring

If I increase a current CC limit will it affect my credit score?

natasjlp — Fri, 03 Apr 2009 23:10:09 GMT

I have a CC with several years of perfect history - it is only for $1300. I would like to increase that limit to like $5k or $10k.

How will this affect my credit? Negatively: Inquiry and/or new line of credit? Positively: My debt to credit improves instantly?

I am looking for a mortgage soon and don't want to harm my credit - but perhaps this could inprove it?

Re: If I increase a current CC limit will it affect my credit score?

haulingthescoreup — Fri, 03 Apr 2009 23:45:29 GMT

natasjlp wrote:

I have a CC with several years of perfect history - it is only for $1300. I would like to increase that limit to like $5k or $10k.

How will this affect my credit? Negatively: Inquiry and/or new line of credit? Positively: My debt to credit improves instantly?

I am looking for a mortgage soon and don't want to harm my credit - but perhaps this could inprove it?

If you routinely carry balances or allow balances to report, it might help by raising your total CL, thereby reducing your util, if your balances don't increase.

If you have few open CC's, you might be immediately helped by adding another. If you have a medium number, maybe no effect. If you already have a bunch, it might hurt.

Any inq damage depends on how many you already have. Which card is it? Some banks do hard inqs for a CLI; many don't.

If your AAoA gets appreciably lowered by a new account, it might hurt your scores.

Re: If I increase a current CC limit will it affect my credit score?

natasjlp — Sat, 04 Apr 2009 16:02:58 GMT

All of my balances are very low except for one that I am paying off - should be paid off in about 10 months.

Will the bank tell me if they do a hard inquiry?

Will the new ratio of revolving balances offset the negative of an inquiry if the new credit line is high enough?

Will it show as a negative because it is a 'new line of credit'? or does it slip by because it is on an older existing account - how is it reported?

I have 2 new accounts within a year but only 1 'recent inquiry'.

The Ratio of my revolving balances to my credit limits is 11%.

What are all possible ramifications of an increased credit limit on an existing card? I plan on keeping a low balance.

Re: If I increase a current CC limit will it affect my credit score?

natasjlp — Sat, 04 Apr 2009 16:07:32 GMT

Is raising my credit limit subtantially something I can do to increase my credit score by lowering the % of balance to limit?

How long would something like that take to show on my score and would it offset any negatives like an inquiry and a 'new line of credit' mark.

I know a 'new line of credit' would negatively affect my score - how do they mark an increase of an existing credit line? do they mark it the same?

Re: If I increase a current CC limit will it affect my credit score?

haulingthescoreup — Sat, 04 Apr 2009 16:17:03 GMT

natasjlp wrote:

All of my balances are very low except for one that I am paying off - should be paid off in about 10 months.

Will the bank tell me if they do a hard inquiry?

It would be nice if they would, but stuff happens. Again, which bank is this? For instance, Chase always does hards, BofA always does softs unless you're too close to your limit and you've done this too many times. Etc etc.

Will the new ratio of revolving balances offset the negative of an inquiry if the new credit line is high enough?

You still haven't given us enough info: What is the total of your current total balances due, and what is the total of your current credit limits? This is how util is determined.

And we don't know how much a new inq might "cost." How many inqs from the last 12 months do you have on each separate CRA now, and what are your most current EQ and TU FICO's and your last known EX FICO (pulled before 2/13/2009.) Please, no FAKO's.

Will it show as a negative because it is a 'new line of credit'? or does it slip by because it is on an older existing account - how is it reported?

It should not show as anything new. The CL will simply show the higher figure.

I have 2 new accounts within a year but only 1 'recent inquiry'.

On which report does the inquiry show? (EQ, TU, EX)

The Ratio of my revolving balances to my credit limits is 11%.

Getting it to 9% might help.

What are all possible ramifications of an increased credit limit on an existing card? I plan on keeping a low balance.

I have yet to hear convincing evidence of negative effects of increasing a CL. It doesn't necessarily help, other than in the possible effect upon util.It gives you a little wiggle room if you do make a larger purchase than usual. When applying for credit in the future, lenders (who are chicken and like to play follow-the-leader) like to see higher CL's on your reports.

Re: If I increase a current CC limit will it affect my credit score?

natasjlp — Sat, 04 Apr 2009 16:43:28 GMT

thank you for your detailed info and questions. I don't know enough about credit to even ask the right questions yet!

I will start from the top:

1. the bank is BofA (soft sounds good)

2. I owe $868 and that is 11% so like 8K (my reports don't show my total)

3. Recent Inquiries show as follows EQ: 0 TU: 1 EX: [I have not pulled anything from EX because not available from myFICO]

4. FICOs as of yesterday 4/3/09 EQ:701 TU:690 EX: [again - no EX - just started working on my credit score recently]

Sounds like there is no reason I shouldn't ask BofA to increase my limit - what is the best way to do this? just call and ask them? do I need to ask for a limit or do they just come up with it on their own?

Message Edited by natasjlp on 04-04-2009 09:43 AM

Re: If I increase a current CC limit will it affect my credit score?

PayingTheBills — Sun, 05 Apr 2009 13:35:55 GMT

Call the BoA backdoor number listed in this thread:

Backdoor numbers

The CSR's you'll reach using backdoor numbers are (IMO) much more helpful than the standard BoA frontline CSR's.

Re: If I increase a current CC limit will it affect my credit score?

natasjlp — Sun, 05 Apr 2009 17:57:23 GMT

hey - that seems pretty cool - thanks for the link to the backdoor numbers! I will try that Monday.

another question. Increasing your credit limits seem like a great way to improve your credit score and borrowing capacity. Are there any guidlines to this process, like how often can I apply for a CLI? maybe once a month? as soon as I increase one card can I go to another? and so on and so on?

Are there any downsides to this if all the inquiries are soft?

I have 1 card I just opened in Jan - when can/should I ask them for a CLI?