Keeping limits high

[longtimelurker]

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@Anonymous wrote:

AA usually happens when you actually use too much credit. Lenders love to grant you huge limits but get skittish when you actually use it. Just make small charges every 3 months or so to keep them active and pay them in full and you should be fine. If a lender AAs you for being responsible you don’t want to be their customer anyway. 

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I think that is too broad!   In the case of Capital One, as mentioned, with a large CL, token charges every few months won't prevent a CLD, you need to be using "enough" of the CL.    And I think from a lender view, that's pretty responsible.   I don't want a bank giving out way too much credit, we saw what can happen in 2008-9.   And a responsible user shouldn't require a huge unused CL either.

[Kforce]

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@longtimelurker wrote:

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  And a responsible user shouldn't require a huge unused CL either.

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+100

Have never understood needing 40,000 CL on a Discover or US-Bank Cash+ card.

Cards that have a $1,500-$2,000 cap on rewards category.

They never reports even a couple thousand, but I need $40,000.

Good thing I am not a lender, most would not like my policies.

From my experience, I have never had a CL decrease because of minimal use.

Have had CC's for 30+ years and many only had 5-10 dollars spend every few months.

However I also don't ask for or push CL's to a level that should make an issuer uncomfortable.

If your income, credit history, and scores support your CL's, I would not worry about spend.

Personally I have not seen CL decreases even with Barclay's or Sync from small spend.

[imaximous]

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@Kforce wrote:

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@longtimelurker wrote:

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  And a responsible user shouldn't require a huge unused CL either.

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+100

Have never understood needing 40,000 CL on a Discover or US-Bank Cash+ card.

Cards that have a $1,500-$2,000 cap on rewards category.

They never reports even a couple thousand, but I need $40,000.

Good thing I am not a lender, most would not like my policies.

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I'd normally agree with you, but both Discover and US Bank Cash+ send me offers for 0% for 12 mos BTs often. Personally, I may not have much use for Discover, but if I need to take advantage of a BT, I'd rather do a $10k BT on a $40k card as opposed to a $10k - $15k card and be totally maxed out. You can definitely find some use out of those cards with limited earning potential.

[Anonymous]

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@imaximous wrote:

 I'd normally agree with you, but both Discover and US Bank Cash+ send me offers for 0% for 12 mos BTs often. Personally, I may not have much use for Discover, but if I need to take advantage of a BT, I'd rather do a $10k BT on a $40k card as opposed to a $10k - $15k card and be totally maxed out. You can definitely find some use out of those cards with limited earning potential.

Same here. While I don't feel I'll ever need a CC with a $40K CL, $20-25K is  nice sweet spot for BT's to avoid high utilization. It's a nice option or floating a very low to interest free loan, othe than the transaction fee. My Citi Diamond for example is only $7K, so I come very close to that threshold quit often on just a very small amount. Anything over $3k would put over the 29%, so it's nice to haev the extra breathing room.

Luckily my Amex ED and Discover have much higher CL, which also offer BT promo rates. AAdvantage and CSP don't seem to ever offer anthing for BT's, so those are strictly for purchases. 

[AverageJoesCredit]

Op, you should be fine so long as you actually use your accounts once in awhile. For some of us, as i am finding out lately, having high limits is nice but depending on ones profile/income, it can eventually become a hindrance to getting more credit due to be over extended or some lenders will feel there is too much risk there or one is sufficiently obligated. Best of luck on maintaining what you feel is sufficient

[Anonymous]

Thank you all. I don't need high limits and for the most part pif as I have been using AZEO most months since I started this journey back in August. I had gotten myself into trouble when I was younger and have learned so much from my past mistakes with credit. The main reason I want to keep my 3 cards at least 15k is so that if I ever have to carry 1k-2k, even 3k on a card for a short period of time and not worry about utilization on that given card. 

Now do I need 3 of them for that purpose? No I guess not. But I'd like to think that if one lowers me then I still have the others. I have an Uber card with a low limit that I won't even try to get raised. It seems like Barclay's gives AA at a higher rate than most other banks.

Btw the cards with higher limits for me are Discover, Flagship, and NFCU Platinum. From what I read above, the Discover may be okay with minimal use, but does NFCU lower limits with minimal usage since I have 2 cards from them that could hinder things for my utilization as it would only give me one card.

[Kforce]

@imaximousand Janus

You are correct, a large CL would be beneficial for BT's.

I was not thinking from you perspective as I have never even thought about doing a BT.

The problem is that to get large CL's on cards that normally don't see much use, an issuer has to be willing to put themselves at a higher risk level.   If one get to this level and never uses it, there might be a time it is lowered again because of the risk.  Even if used, it still puts you at a level where if there are changes in your profile, flags might come up.

I believe the CC user who is conservative with credit limits is less likely to have his/her limits lowered.

One needs to value getting high CL's for BT's or utilization padding, against staying in the safe zone.

As with all things there is no answer that fits everyone. 

I am probably safe but can't take advantage of BT offers with out crashing my utilization.

* Many like to fly closer to the sun than I am comfortable with. *  

[9CLINE]

Great question OP, I also was curious about the same thing. I've have had my major cards 5+ yrs w/o any AA so far for low usage. 3 Synch. cards haven't had any AA since obtaining 5 digit CLs using ~ 2/yr.  But an AU Synch. Care Credit with 800.00 CL was closed for 2yrs of non use ( that was a long time). OTOH my 5 yr. old Citi backed HD was CLD from 4,500 to 2,501 last yr for 8 mths of non use. Since then I put a small purchase on non daily cards @ least every 6mths and PIF B4 statement cuts. 

Really enjoyed the different replies to this question and will keep all in mind.

Hope all works out for ya...

[Anonymous]

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@longtimelurker wrote:

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@Anonymous wrote:

AA usually happens when you actually use too much credit. Lenders love to grant you huge limits but get skittish when you actually use it. Just make small charges every 3 months or so to keep them active and pay them in full and you should be fine. If a lender AAs you for being responsible you don’t want to be their customer anyway. 

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I think that is too broad!   In the case of Capital One, as mentioned, with a large CL, token charges every few months won't prevent a CLD, you need to be using "enough" of the CL.    And I think from a lender view, that's pretty responsible.   I don't want a bank giving out way too much credit, we saw what can happen in 2008-9.   And a responsible user shouldn't require a huge unused CL either.

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Except I wouldn’t care if Cap CLD’d me because I only keep that card open since it’s my oldest by far (5/2014 vs my other cards ranging from 3/2018-12/2018). AA me, I don’t want to do business with them anyway because of their horrendous policies for existing cardholders. 

[IFtkkdx428]

Being in the financial industry, we must always remember the five “C”s of Credit.

Character
Capacity
Capital
Collateral
Condition

There’s only one you cannot control which is “Condition” If the market is in turmoil, then don’t take it personally. If not, the other 4 reasons were due to your actions.