Discover CLI denied?!

[BuildingBetterCredit2020]

So I was approved for a Discover IT card with a CL of $11K back in Dec 2020. I've kept my CU pretty low on this card as well as others (~3-4% on average) and have PIF every month. Figured, it's been 13 months so why not hit the love button and see if I can get a CLI to help even further with my CU. I clicked the button a little over a week ago and was denied. Finally got the letter in the mail as to the reason. 

                   "LOW USAGE ON EXISTING LINE OF CREDIT IN PREVIOUS MONTH(S)"

Really?! That's the reason? Guess I'm new to this game. I get it...show that you need more credit to get more credit. Spend more and pay it off. Seems somewhat counterintuitive however, because you're encouraging card holders to run up a balance and potentially get in trouble. I guess at the end of the day, creditors care less about your CU than you do,  and more about how much debt they can get you to run up without you going into default.  *smh*

[Anonymous]

I think their take is more along the lines of: if you aren't using a significant portion of your current limit, why do you need more?  

[Remedios]

It is not counterintuitive at all.

If youre using 3%, your limit is more than adequate.

If you were using 97% of your limit, then it's not quite adequate. 

As far as encouraging consumers to run up cards, that's absolutely not the case. 

You simply don't have the need for more, so they won't give you more.

If they tripped your limit right now, you'd still be putting $300 on it.

That makes no financial sense, especially given the amount they have to hold in reserves. 

You got a great SL from Disco, you have sufficient limit on it, and if one day your card sees increase in use, you might see CLI. 

[House2021]

Same thing happened with me and Capitol one

[M_Smart007]

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@Anonymous wrote:

I think their take is more along the lines of: if you aren't using a significant portion of your current limit, why do you need more?  

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As myFICO'ers ... we always "need' more

A pack of gum is getting up there these days

[Heatt99]

Not enough usage & too much available credit. Must find a happy medium between the two. 11k is not bad from discover assuming one can only get back $300 from 6k spend on max categories yearly. 

If you up your spending to 30% quarterly, I'm sure Disco will notice and entice you to spend more with a CLI. If they find themselves at the bottom of your CL and you're still using your card at a medium rate, im sure they would entice you with a CLI.

Disco it not at the top when it comes to assets avaliable, but hey they do have a great app, great customer service, and a med tier opportunity when growing a credit profile. 

[Horseshoez]

This thread got me thinking; if someone typically charges say 60% of their credit limit and then pays in full prior to the due date which in turn only shows a few percentage points of credit usage by the time the statment is cut; do the lenders take the maximum credit usage into account, or do they simply look at the amount when each statement was cut?

[integral0]

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@Horseshoez wrote:

This thread got me thinking; if someone typically charges say 60% of their credit limit and then pays in full prior to the due date which in turn only shows a few percentage points of credit usage by the time the statment is cut; do the lenders take the maximum credit usage into account, or do they simply look at the amount when each statement was cut?

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Don't have an answer but can share my experience - I carried a 90%-95% CU on my $4.8k limit card for a few statement cycles and fully paid it off, had a zero balance for one statement cycle then out of curiosity requested a CLI in the Discover app - they gave me an increase of $300. Better than nothing!

[Anonymous]

OP, did you typo "2020" in the original post?  I'm assuming you meant 2019, otherwise your account is only 3 months old.

As far as usage and Discover goes, it's all profile dependent.  While I agree 100% that Discover has no reason to extend further credit to someone that's hardly using their limit, they still do that all the time.  I on average was using my limit around .5% monthly (yes, decimal before the 5) and even using it $0 some cycles and was still able to get about 10 CLIs from them over several years.

[BuildingBetterCredit2020]

Yes, that was a typo on my part. It should have read Dec 2019. Thanks for the catch!