[Question] Is it worth having a 50k Credit Limit

[woodyman100]

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@TheFIGuy wrote:

Hey myFICO Familia,

Do you believe it's worth having a 50k credit limit on a card(s)?

I ask because I'm almost at my NFCU 80k aggregate limit across all accounts. 

• NFCU - 0001 is at a $41k credit limit
• NFCU - 0002 is at a $37k credit limit

I know NFCU doesn't allow credit limit reallocation anymore (maybe they will in the future), and I'm thinking of two options:

1. Lower NFCU - 0002 limit by $7k and then submit an $8k credit limit increase for NFCU - 0001 to bring it to $49k. I will then wait for the 6/months to put the extra $1k request in for an aggregate $30k + $50k = $80k credit limit across my two accounts.
2. Lower NFCU - 0001 limit by $1k and then submit a $3k credit limit increase for NFCU - 0002 to bring it to $40k. I will then keep both NFCU - 0001 and 0002 at $40k each for a total of $80k credit limit across my two accounts.

I have a couple of 25k credit limits, but I do not have anything in the $50k range. I'm not sure if it matters much, so I wanted to get the general vibe here. I'm looking for long-term benefits. Would this help get higher approvals in the future having a $50k credit limit, or does that not matter to UW/Banking systems as a whole?

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Yes 

[tacpoly]

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@CH-7-Mission-Accomplished wrote:

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@wasCB14 wrote:

Maybe I'm just in an unusual situation with a comparatively modest 1040 income most years (and thus modest CLs) relative to my spend, or that my spend is lumpier than most (large amounts here and there, modest at other times)...

But do other PIFers find the idea of always staying within 9% or 10% of a CL totally unrealistic?

A $50k CL will generally require a fairly high income, and it seems like a $5100 bill would not be so rare even for people who don't have business expenses.

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Most of life's expenses don't change based on how big or small your income is.   If you've ever called a plumber, you know it's $1000 before they get out of their van.   But for anyone who has been on MyFICO for any length of time knows, you can immediately pay down that large expense before the statement date if you care about having your total and per card utilization at or under 10%.   If say you have $10,000 limit cards and have to put something on your card for $5000, that would be 50% utilizatioin.   If I have a $50K card and need to put $25,000 on that card, that's 50%.  I would never let $25K report if I already had the cash to pay for it.   

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Why not let the it report?  Sure, your score will fall a little bit, but it will bounce back once the reported balance goes down to normal levels.  There's no detrimental effect to sometimes not being at your optimal score if you're not applying for anything.  I would think that having occasional high balance then a PIF would show that the high limit is justified and that you can afford it.  

[wasCB14]

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@tacpoly wrote:

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@CH-7-Mission-Accomplished wrote:

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@wasCB14 wrote:

Maybe I'm just in an unusual situation with a comparatively modest 1040 income most years (and thus modest CLs) relative to my spend, or that my spend is lumpier than most (large amounts here and there, modest at other times)...

But do other PIFers find the idea of always staying within 9% or 10% of a CL totally unrealistic?

A $50k CL will generally require a fairly high income, and it seems like a $5100 bill would not be so rare even for people who don't have business expenses.

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Most of life's expenses don't change based on how big or small your income is.   If you've ever called a plumber, you know it's $1000 before they get out of their van.   But for anyone who has been on MyFICO for any length of time knows, you can immediately pay down that large expense before the statement date if you care about having your total and per card utilization at or under 10%.   If say you have $10,000 limit cards and have to put something on your card for $5000, that would be 50% utilizatioin.   If I have a $50K card and need to put $25,000 on that card, that's 50%.  I would never let $25K report if I already had the cash to pay for it.   

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Why not let the it report?  Sure, your score will fall a little bit, but it will bounce back once the reported balance goes down to normal levels.  There's no detrimental effect to sometimes not being at your optimal score if you're not applying for anything.  I would think that having occasional high balance then a PIF would show that the high limit is justified and that you can afford it.  

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I figure I'm best off where I am - putting things on Amex Business cards. Since I rent from my family's business, home repairs are a genuine business expense.

And as plumbers go, I actually get good deals since I can give a lot of business.

I like the ability to have silly unreported utilization (300% on a single card once), have low reported utilization, and to hold onto cash until the bill is actually due. And having made 5-figure payments to Amex probably plays in role in my having 6-figure spending power.

[Namaste7]

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@wasCB14 wrote:

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I've called BofA customer service twice, and even though the phone system's automated recording mentioned my PR "status" I still had to wait 15 or 20 minutes to talk to a human.

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I'm not sure if you tried this, but initiate the call via the BofA app to get the the customer service line specifically for PR members.

[wasCB14]

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@Namaste7 wrote:

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@wasCB14 wrote:

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I've called BofA customer service twice, and even though the phone system's automated recording mentioned my PR "status" I still had to wait 15 or 20 minutes to talk to a human.

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I'm not sure if you tried this, but initiate the call via the BofA app to get the the customer service line specifically for PR members.

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I'll try that next time, thanks.

[Namaste7]

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@TheFIGuy wrote:

Hey myFICO Familia,

Do you believe it's worth having a 50k credit limit on a card(s)?

I have a couple of 25k credit limits, but I do not have anything in the $50k range. I'm not sure if it matters much, so I wanted to get the general vibe here. I'm looking for long-term benefits. Would this help get higher approvals in the future having a $50k credit limit, or does that not matter to UW/Banking systems as a whole?

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The first question is subjective and is really personal to your income and net worth, your spending and payment patterns and credit profile. 

IMHO, the gateway to higher approvals can be reached when you have multiple cards at the $20-25k level. As @Aim_High noted, having a single $50k card may not result in a $50k approval but might support approvals greater than $30k (of course all other app parameters considered).

My CL sweet spot is ~$30k. That said, it would be nice to have one card closer to the $50k range for BTs only (hello BECU or PenFed SP CLI 😜). I could achieve a high CL card with BofA, but I prefer to keep my limits split between multiple CR cards.

[Citylights18]

Recently I placed $4500 on a $7000 Citi Premier card to hit an SUB. It knocked my scores down to 720 for a month and then they bounced back up to 780 once I paid it off. Its not going to kill you unless you go for the mortgage in that time period.

IMO pumping up credit lines makes the most sense when you are trying to drop down utilization. Getting the right cards that will give you 5 figure limits is a way out of the high interest trap. Strategic use of balance transfers helps.

If the plan is to not to take out more credit anytime soon there is nothing wrong with taking a 0% APR promotion on a a card, particularly if the intent is to pay it off before the APR period is over. If you do that on the business side it doesn't report to your personal credit (if you select the right cards) then you can lift and shift the debt to a business or personal loan.