How much does your credit line depend on your Income vs History?

[takeshi74]

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@Anonymous wrote:

When I see some of you guys and gals with 6 figures worth of credit on here it makes me wonder if you're all neurosurgeons, lawyers and CEO's or if it's more dependent on your history and score more than your actual income

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Both matter.  How much is not quite so clear cut but that's in part because each creditor determines what they're willing to extend to a given credit profile and income.  Creditors are not all identical.

Not everyone with 6 figures is one of the above.  Salaries not only vary by occupation but by industry, region, etc.  I make 6 and I'm not any of the above.  However, I am in IT for an oil & gas company.

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@Anonymous wrote:

I've never been asked to verify income, seems like you can type in any number you want.

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You could but that would be fraud.  Additionally, I always recommend considering what the creditor will require in case of verification.  Always be careful conflating "I have never experienced" and "never happens".  Never assume broad trends based on insufficient sample data not matter what the topic.  You can find plenty of examples of income verification here if you search.

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@Anonymous wrote:

For those who report $20K-50K income on apps and still receive 5 digit trade lines, I don't know how they do it. I app'd for my first Amex card a few months ago, and they granted me $500 (yes, not missing a zero) CL with over $130K reported income.

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They have better credit.  The aggregated anecdotal evidence seems to suggest that AmEx's credit/income ratio is probably around 40%.  If you're only getting a $500 initial limit from any creditor that tends to indicate that there are concerns with your credit profile.

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@Anonymous wrote:

I know for a fact my high income has been looked at favorably by creditors that wouldn't have extended me credit otherwise.

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How so?  You seem to be assigning far too much weight to income IMO.  Income plays a part in determining limits but it does not play as much of a role in evaluating risk.  That's primarily determined by credit.  People often conflate high income and good credit but the two are not mutually inclusive.

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@Anonymous wrote:

It's hard for me to verify too sometimes so I'm glad I've never been asked yet lol.

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Creditors will tend to look at your track record over the past years in such cases.  They do the same sort of thing for people like my wife who derive a majority (or all in her case) of income from commission.

[Gmood1]

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@Anonymous wrote:

When I see some of you guys and gals with 6 figures worth of credit on here it makes me wonder if you're all neurosurgeons, lawyers and CEO's or if it's more dependent on your history and score more than your actual income -- Can anyone (who has great credit history) obtain this  much credit or are all of you extremely high paid individuals?

Just curious if you're all highly successful or just managed your credit like a boss, I'd assume a combo of the two.

I've never been asked to verify income, seems like you can type in any number you want.

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No it's not all about income. I would assume the geographical area must play some part in this as well. We all have to remember $100K in New York City or Washington D.C. isn't the same $100K in Atlanta,GA. The same $$$ gets you a lot more or less depending on your location. Same with Los Angeles verses rural Illinois. 

You don't need a doctor's salary to have a  6 figure amount of credit. With my home, vehicle and credit cards I'm just over $430,000 in credit lines. I don't earn a fourth of that. lol

But I'm good with money and know my budget. Money goes further in my area than it does in most major cities. 

On top of that, my credit history hasn't been all that great. It's much better now, but still not without flaws.

To add, if you were a CC underwriter and you had two people with identical scores. Would you give the person with a mortgage more credit or the one who rents an apartment? Just something to think about.

[Anonymous]

Income is important but not as important as your credit profile. There are lots of people with horrible credit with individual/household income(s) of 100k+ and the banks won't touch them. On the other hand there are folks with individual/household income(s) that range from 30k-50k with excellent credit and banks are falling over themselves to extend them credit.

When applying for credit make sure to report your income accurately and you shouldn't have anything to worry about. As long as you tell the truth, if and when, verification is requested you will be okay.

[Anonymous]

@Anonymous wrote:

For those who report $20K-50K income on apps and still receive 5 digit trade lines, I don't know how they do it. I app'd for my first Amex card a few months ago, and they granted me $500 (yes, not missing a zero) CL with over $130K reported income.

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They have better credit.  The aggregated anecdotal evidence seems to suggest that AmEx's credit/income ratio is probably around 40%.  If you're only getting a $500 initial limit from any creditor that tends to indicate that there are concerns with your credit profile.

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@Anonymous wrote:

I know for a fact my high income has been looked at favorably by creditors that wouldn't have extended me credit otherwise.

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How so?  You seem to be assigning far too much weight to income IMO.  Income plays a part in determining limits but it does not play as much of a role in evaluating risk.  That's primarily determined by credit.  People often conflate high income and good credit but the two are not mutually inclusive.

Well said takeshi74!

[Themanwhocan]

My income is $61k, but I've worked for the same university for 30 years. My credit history is less than 4 years, and the first year of that was one secured credit card.

I think you need to look at many factors, Get a bank card with a large credit limit (my American Express went from $2000 -> $30000). Get several cards to at least $10000 (good for the FICO score). Keep working on SP CLI's and the occasional HP CLI when necessary. Keep a close eye on the FICO score, and if it starts dropping to much, stop applying. Conversely when the FICO score recovers, apply for more cards, but always have a well thought out strategy (does the new card allow SP CLI, is the creditor known for high limits, high cash back, etc). 

I see too many people worrying only if their FICO score is high enough to get a particular card. I was concerned about also getting a high starting limit, and also getting good CLI increases. That requires a disciplined approach to card usage and watching both the FICO score and how long its been since you last applied for a few cards.

My FICO scores sure seem much better now that I have a secured $500 installment loan paid down to $200 (I will go lower soon). And I've started getting very good starting limits, though now that my American Express has been at $30000 for over 6 months that probably helps a lot as well. My scores used to drop to low 700's and have a hard time getting to 740. Now 735 - 744 is typical, and with the Installment loan I expect my scores to recover to new highs.

Let me be clear though, I never emphasized getting a lot of credit. Getting high cash back cards was always my primary goal. But that doesn't mean I didn't also ask for SP CLIs. I also don't need a low APR since I expect to pay in full, but I still ask for APR reductions periodically. 

[Anonymous]

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@takeshi74 wrote:

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@Anonymous wrote:

For those who report $20K-50K income on apps and still receive 5 digit trade lines, I don't know how they do it. I app'd for my first Amex card a few months ago, and they granted me $500 (yes, not missing a zero) CL with over $130K reported income.

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They have better credit.  The aggregated anecdotal evidence seems to suggest that AmEx's credit/income ratio is probably around 40%.  If you're only getting a $500 initial limit from any creditor that tends to indicate that there are concerns with your credit profile.

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@Anonymous wrote:

I know for a fact my high income has been looked at favorably by creditors that wouldn't have extended me credit otherwise.

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How so?  You seem to be assigning far too much weight to income IMO.  Income plays a part in determining limits but it does not play as much of a role in evaluating risk.  That's primarily determined by credit.  People often conflate high income and good credit but the two are not mutually inclusive.

Read my second post in the thread. My point is that Amex obviously doesn't care much about income if you're borderline, whereas it clearly got me into the minimum required limits for certain types of revolving accounts with other creditors with limits 10-18x that of what Amex was willing to extend. I would simply not have been approved if I put down 25K income in those other cases. I would not have been approved as the limit they were willing to extend to me wouldn't have met their minimum opening limit. Period.

There has been a graphic posted several times that roughly lays out underwriting for some random or hypothetical bank's credit card product. The difference in income can be the difference between a 5K starting limit and a 10K starting limit in some cases. That's huge, and it cannot be underplayed. If you have great-to-excellent credit, you can get anything you want, credit-wise, but if you're in the fair-to-good range (say, 650-to-low-700's), income, from my ancecdotal experience (again, read my second post) is a huge make-or-break factor.

[Anonymous]

Income is definitely a key factor in an application. My partner has the same credit background as I do (i.e. length of credit history, same credit cards, no collections, baddies, no late payments, etc). He makes $60k a year and I make around $25k-$30k.  He gets about 3x more of a credit line than I do. I make $25k annual just from my job itself. That's not including my parents allowance for helping out with their business frequently. Unfortunately I won't be able to include that to my income until I am 21 according to the creditors. Disagree with that age requirement, but that's another story. I can see how it would make sense from a financial granting point of view (more income = more likely to have the funds to pay off the debt).

EDIT: I am going to add on and +1 what another user on here said: Banks are more willing to grant you a higher line (regardless of income) if you pump money through the card. 

[Anonymous]

Income is definitely a key factor in an application. My partner has the same credit background as I do (i.e. length of credit history, same credit cards, no collections, baddies, no late payments, etc). He makes $60k a year and I make around $25k-$30k. He gets about 3x more of a credit line than I do. I make $25k annual just from my job itself. That's not including my parents allowance for helping out with their business frequently. Unfortunately I won't be able to include that to my income until I am 21 according to the creditors. Disagree with that age requirement, but that's another story. I can see how it would make sense from a financial granting point of view (more income = more likely to have the funds to pay off the debt).

[Anonymous]

i only make $30k a year and NFCU gave me a $15k LOC for some reason

[disdreamin]

In my experience AmEx cares very much about income when you start asking for CLI's or new cards. 

I got a 4506-t request when I tried for higher limits with them. I did get a modest CLI, but if I want to go any further I'll have to allow them access to my return info. I haven't yet decided if that is something I'm willing to do or not. I didn't pad income (other than using household - SO is an AU on the accounts and has been on one of them for decades).

So yes, I think income does play a role - but it isn't as important as your file, IMO.