Why Do High CLs Matter?

[Gollum]

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@tpatterson2k9 wrote:

This question may have been asked before, but I see it all the time on this forum of people hoping, waiting, and often receiving the CLIs they request.  I am not trying to sound callous, but wouldn't a $1,500 CL suffice just as much as a $15,000 CL?  Perhaps it's just me, but my highest CL right now is $5,850, and I think this is more than enough (lowest is $3,900).  Most of my cards HP for CLI requests so I just don't bother.  Rather, I pay my CCs off multiple times per month (or more recently, push a higher payment through via online bill pay) to keep my util low.  So my question, what is the huge fascination with large CLs (other than the decreased util they can provide and bragging rights)?  Are multiple payments per month to a CC looked down on by the CCCs?  I'm wondering if I am missing something here. 

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Most of the posts to this WWW forum are from people building/rebuilding credit.  People building/rebuilding credit are trying to increase their credit limits.

[Anonymous]

Let me grant you the perspective of someone that ISN'T a big spender.

My total lines equal $32K+, but I'll probably never use more than 1 to 2 K+ a month.

Right now I have a dwindling balance thanks to some past dental work. It was an emergency and I needed the work done. With those increased CL's I've gotten lately, my 50% utilization has shot down all the way to 13%.

Plus, it's nice to know that if BoA ever decided to shut down my 15.9K card, I'd have some extra cushion to fall back on.

Also, it looks real nice when I head over to a car dealer or a mortgage broker in the future.

It shows that I'm responsible as well.

So I might not be the big spender, but it's a fallback plan, a FICO score-buster, and a cushion. Plus, if I ever needed to make a big purchase, I'd get points and wouldn't have a ceiling on it. I'd much rather know I could spend 2K on one card with a 9K CL than to worry about splitting those charges across a few cards.

[learnin113]

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@tpatterson2k9 wrote:

This question may have been asked before, but I see it all the time on this forum of people hoping, waiting, and often receiving the CLIs they request.  I am not trying to sound callous, but wouldn't a $1,500 CL suffice just as much as a $15,000 CL?  Perhaps it's just me, but my highest CL right now is $5,850, and I think this is more than enough (lowest is $3,900).  Most of my cards HP for CLI requests so I just don't bother.  Rather, I pay my CCs off multiple times per month (or more recently, push a higher payment through via online bill pay) to keep my util low.  So my question, what is the huge fascination with large CLs (other than the decreased util they can provide and bragging rights)?  Are multiple payments per month to a CC looked down on by the CCCs?  I'm wondering if I am missing something here. 

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Utilization.  It matters to most.

[oracles]

My case in point is, recently due to family emergencies, i had to pay alot of medical bills and put it on my credit cards.

If i didnt have the high credit limits on my cards that i have now, my util would be in the 80-90% range thus causing all types of negative actions against me.

Credit limits slashed, cards closing, etc. With having the high limits i have, it allowed my util to be only 40-45% and not having too much negative actions taken against me.

I will not be able to get a new card because of the high util but i also wont have cards closing and limits reducing. In emergencies like this, i benefited tremendously from getting my limits as high as i could throughout the years.

[webhopper]

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@SamsungHDTV wrote:

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@tpatterson2k9 wrote:

This question may have been asked before, but I see it all the time on this forum of people hoping, waiting, and often receiving the CLIs they request.  I am not trying to sound callous, but wouldn't a $1,500 CL suffice just as much as a $15,000 CL?  Perhaps it's just me, but my highest CL right now is $5,850, and I think this is more than enough (lowest is $3,900).  Most of my cards HP for CLI requests so I just don't bother.  Rather, I pay my CCs off multiple times per month (or more recently, push a higher payment through via online bill pay) to keep my util low.  So my question, what is the huge fascination with large CLs (other than the decreased util they can provide and bragging rights)?  Are multiple payments per month to a CC looked down on by the CCCs?  I'm wondering if I am missing something here. 

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There is probably a big spectrum of reasons why people want high CLs. My sole reason is to increase my total CL and thus decreasing my utilization and hoping for the end result of a higher credit score.

EDIT: I thought of a secondary reason, if my spending habits were high... I wouldn't want to be limited and having to make frequent payments. A prime example: I had a client that travels constantly for his employer. He wine and dines his clients, and runs his expenses through his personal card. His expenses can to get up to $8,000. His CL was less, and he doesn't get reimbursed until a week or two later I cant remember. He liked using his own card so he can take advantage of the rewards. But essentially he had a cash flow issue hindering him.

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I am the same way... I had a cash flow issue hindering me... It wasn't unusual for my expense reports to be in the several thousands....  so basically my one and only Discover card one yr ago would fluctuate between being maxed or being paid off completely.  In some cases, the plane tickets were more than my CL could handle and I had to use my regular bank account, which makes me shuffle to pay normal bills.   Also, if an emergency happens, for example, the a/c went out at my rental house and I had to try to cash flow a new a/c unit, several expensive trips, plus normal bills like the mortgage all on my salary... it was tough!!!   Multiple credit liines, and especially Zync with NPSL has given me much flexibility with regards to cash flow and keeps me from having to juggle and hold my breath and stress over not overdrawing my account while trying to cash flow stuff for work.     Its much easier to chat and visit with colleagues at dinner when you don't have cash flow stress in the back of your mind.

[navigatethis12]

Personally, I just like a to log-in and see a high number in the credit limit space. My utilization is 90% of the time at zero and I usually only spend a little a month. To me it is just a game to see how high I can get it.

[jamesdwi]

It's all about the UTL, and the feedom of not having to worry about hitting a limit, I pay for some of my monthly bills with credit cards for the points. If I used a lower limit card for those payments and then went shopping and made a few on-line purchases its not hard to use 80% of the limit this scares some credit card companies and if it was ever reported it would kill your FICO score for the month. Going over 80% UTL on a single card is a major red flag to creditors. I think its necessary to have at least major one card with a CL equal or greater than 125% of one month's take home pay so you can charge everything on the card and not have to worry about the limit. 

I have lived with a $750 limit card, One trip to the grocerystore or Walmart and the card is at 50% UTL, Going home and Making a payment then sitting around waiting for the payment to clear and availible credit to be reset, of course life continues Car needs gas, Dinner out with the spouse, your UTL goes up higher a few other minor expenses hit and the card has just  $10 availible credit, Even though I made a $500 payment and its cleared the bank its still possible to get denied so you have to switch cards, of course you loose rewards by switchig to a lesser card. 

Sometimes I do worry about seeing the Total Availible Credit line in my Credit card spreadsheet, $27,730, I think why do I need that much, But on the other hand I have freedom to make purchases when I want or when there is a good sale and/or interest free deals.

Currently my UTL is at 6% on credit lines that are reporting, And I am gardening untill I get a pre-approved offer for a Discover More card the last card I have on my list of cards to have list. 

[Anonymous]

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@SwiftTone wrote:

Because its BALLER

Other than utilization, it makes other lenders look at you differently and more willing to jump on your bandwagon and compete with the other cards in your wallet. 

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That's funny!

However, I don't know other lenders care how big your limits are. Case in point, I have one card with a 20K limit and when I applied 7 months ago for a couple of Chase cards, the total of the two cards only amounted to 67.5% of that $20,000 card. I figured I'd be good for at least half that 20 on each card. Nope.

I will say that once I got my first 5 figure limit, others did soon follow.

Agreed with many other posters, if you carry a balance, larger limits offset utilization and FICOs aren't bothered by balances carried. Then again, maybe it's an ego thing afterall.

[Open123]

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@Anonymous wrote:

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@SwiftTone wrote:

That's funny!

However, I don't know other lenders care how big your limits are. Case in point, I have one card with a 20K limit and when I applied 7 months ago for a couple of Chase cards, the total of the two cards only amounted to 67.5% of that $20,000 card. I figured I'd be good for at least half that 20 on each card. Nope.

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Was the $20K a CU card?

I've read many instances where the private banks are hesitant to meet CLs from CUs.  I've noticed Chase like to one up Amex in the CL department, at least from my experience and those around me.

[Anonymous]

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@Open123 wrote:

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@Anonymous wrote:

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@SwiftTone wrote:

That's funny!

However, I don't know other lenders care how big your limits are. Case in point, I have one card with a 20K limit and when I applied 7 months ago for a couple of Chase cards, the total of the two cards only amounted to 67.5% of that $20,000 card. I figured I'd be good for at least half that 20 on each card. Nope.

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Was the $20K a CU card?

I've read many instances where the private banks are hesitant to meet CLs from CUs.  I've noticed Chase like to one up Amex in the CL department, at least from my experience and those around me.

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No, Barclay's was the big one. Chase didn't one up AMEX either! I have 2 revolvers (Blue 10K and Delta Gold 7K) and I got a Freedom Visa Sig (6500) and Slate Visa (7000).