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Credit card limits question

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jdxprs1
Frequent Contributor

Credit card limits question

Does having low limit cards hurt you when applying for new cards? Would it be better to close low limit cards if it wont hurt utilization?
Last app 1/2/2017.
In the garden until at least 6/2/2017.
Message 1 of 14
13 REPLIES 13
fltireguy
Valued Contributor

Re: Credit card limits question

Let me say it like this - High limit cards will help you on your SL on new approvals...

NFCU $60.4k/PenFed $22.5k/Commerce $15K/53 $11K/Synovus $14K/BBT $11K/CapOne $12K/DCU $7.5K/BMO $7.5K/Chase $14.5k/Cabelas $10K/ and many many more!
Total CL $398600, plus car and RV loan.
Ooh. Ooh. Getting closer to that $500K mark!
Message 2 of 14
Anonymous
Not applicable

Re: Credit card limits question

Doesn't seem so. In fact some of the members on this forum with the most cards have some of the lowest limits.
Message 3 of 14
red259
Super Contributor

Re: Credit card limits question


@jdxprs1 wrote:
Does having low limit cards hurt you when applying for new cards? Would it be better to close low limit cards if it wont hurt utilization?

There is a sense that some lenders may not be willing to give you a credit card over 5k limit unless another lender has already done so. I'm not sure how true that is in reality but it does make sense that a lender may be more likely to give you a larger credit line if they have seen you appropriately handle high credit lines with other lenders. There is talk about some changes being made to some credit scoring with Vantage which may actually penalize people for havijhng too much available credit. It will be interesting to see how this plays out and how those of us who frequently apply for cards with high limits chose to handle their cards going forward. 

;
Starting Score: EQ: 714, TU 684
Current Score: EQ: 725 7/30/13, TU 684 6/2013, Exp 828 5/2018, Last App 8/5/17
Goal Score: 800 (Achieved!) In garden until Sepetember 2019
Message 4 of 14
Anonymous
Not applicable

Re: Credit card limits question


@jdxprs1 wrote:
Does having low limit cards hurt you when applying for new cards? Would it be better to close low limit cards if it wont hurt utilization?

Before I was established with BofA one of the reasons they gave me why my first cli was so low was the comparison they did with my present limits...so I will say that MAYBE it does play a part with some lenders.....

Message 5 of 14
Anonymous
Not applicable

Re: Credit card limits question


@fltireguy wrote:

Let me say it like this - High limit cards will help you on your SL on new approvals...


+1

Message 6 of 14
HeavenOhio
Senior Contributor

Re: Credit card limits question

That's a great question, OP. I don't think there's a definitive answer. But my gut says that if your cards have a broad range of limits, the high ones will help you more than the low limits might hurt you.

Message 7 of 14
jdxprs1
Frequent Contributor

Re: Credit card limits question

I currently have 5 cards with 1k-5k limits and 4 cards with limits under 1k. After my mortgage refi on June 1st I think I'm going to close my cards with limits under 1k.

All my cards that are 1k or more should be good growers.
Last app 1/2/2017.
In the garden until at least 6/2/2017.
Message 8 of 14
DeeBee78
Valued Contributor

Re: Credit card limits question


@red259 wrote:

@jdxprs1 wrote:
Does having low limit cards hurt you when applying for new cards? Would it be better to close low limit cards if it wont hurt utilization?

There is a sense that some lenders may not be willing to give you a credit card over 5k limit unless another lender has already done so. I'm not sure how true that is in reality but it does make sense that a lender may be more likely to give you a larger credit line if they have seen you appropriately handle high credit lines with other lenders. There is talk about some changes being made to some credit scoring with Vantage which may actually penalize people for havijhng too much available credit. It will be interesting to see how this plays out and how those of us who frequently apply for cards with high limits chose to handle their cards going forward. 


It's absolutely true. Chase will sometimes deny someone for the CSP or CSR if they do not have another card reporting over $5K or $10K. As with any rule, there are exceptions, but it's happened before. 

Message 9 of 14
longtimelurker
Epic Contributor

Re: Credit card limits question


@DeeBee78 wrote:

It's absolutely true. Chase will sometimes deny someone for the CSP or CSR if they do not have another card reporting over $5K or $10K. As with any rule, there are exceptions, but it's happened before. 


Right, but it's the number of exceptions that is also important.   We've also seen a lot of people get a CSR when their previously highest card with $3K, so "absolutely true" seems a little strong.   But also the OP was asking about low limits along with higher limits, and I don't think we've had a case of Chase saying "Yes, we know you have some $15K cards from Citi, but you also have $2K from Target, so no CSP for you."

Message 10 of 14
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