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Cards that do not report credit limits

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Anonymous
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Cards that do not report credit limits

What kind of impact does a card that does not report a CL have on your score, if any?  I have a Firestone and I got an Alert from Eq. that the account is opened but the CL is N/A.  I know that showing a balance can actually hurt your score, but are there any positives for having such a card?


Message Edited by RecoveringMyLife on 04-10-2008 08:20 PM
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Anonymous
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Re: Cards that do not report credit limits



RecoveringMyLife wrote:
What kind of impact does a card that does not report a CL have on your score, if any?  I have a Firestone and I got an Alert from Eq. that the account is opened but the CL is N/A.  I know that showing a balance can actually hurt your score, but are there any positives for having such a card?

When a credit card doesn't report a CL, this can really screw up your utiization calculation.  In the absence of a reported CL, FICO will use the High Balance in its place, which will most likely be much lower than the real CL, and will make your utilization always look much higher than it actually is.
 
Charge cards, like those issued by Amex, do not report a CL because they don't have an actual CL.  When these report correctly, they are classified as "Other" and are not factored into revolving utilization.
 
There are no positives to having a credit card (as opposed to a charge card) that doesn't report the CL, except that many of those cards are Signature Visa cards or World MasterCard cards, which have no preset spending limit.  But as far as some benefit from a regular card not reporting the CL, there is absolutely no benefit at all.
 
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Anonymous
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Re: Cards that do not report credit limits

Thank you.   I was very happy to have gotten approved for $1200.00.  Then I read here that thaty do not report.  It is good to have for emergencies, but it sounds like I need to be very careful with this card.
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