Will accepting a credit limit increase on a card I rarely use help my score.

[Anonymous]

Between recent mortgage inquiries and using credit cards to finance a larger downpayment for a priveate mortgage from my boss, my scores have dropped from the 730s and 740s to 693, 688, and 693. 

I have a couple cards that I rarely if ever use that keep sending me offers to raise my credit limit by several grand.  I'm wondering if I do this (assuming there is no credit inquiry), will it help my scores at all?

I have 9 cards with a total credit limit of $111,100 and total balances of $52,436 as follows:

Discover $8,585/$10,700

Citi Thank You Pref. $2,867/$3,000

Cit Simplicity $9,051/$16,000

US Bank AMEX $13,664/$14,000

BOA Visa $18,269/$26,000

All of them except the Citi Preferred have 0% interest.  I'm planning on paying off the Discover before the introductory rate expires in August.  However, I need to get my score high enough by December to be able to qualify for a balance transfer card to transfer my Citi Simplicity card before it goes from 0% - 24%.

[Anonymous]

In general, yes, traditional scoring models could raise your credit score because you will have more available credit and a lower overall utilization. However, that is only part of what the bank sees when you ask for a CLI. You will have a new inquiry, a new account, a younger average age of accounts, and your utilization per card will not have changed. CLIs like to play hard to get, they're easiest to get by the people who act like they don't need them.

Basically, just be careful. Using CLIs to mask existing debt can go badly, especially if it makes you feel like you have extra money to spend.

[Anonymous]

Thanks.  Just to clarify, this is an unsolicited offer from a card I already have and rarely use not for a new card from them.  I'll have to duble check, but I believe they said before that there would be no inquiry put on my report and that all they needed was updated info. from me. Even after any increase this card will continue to sit in my drawer becuase they don't have any worthwhile rewards.

[Anonymous]

---

@Anonymous wrote:

Thanks.  Just to clarify, this is an unsolicited offer from a card I already have and rarely use not for a new card from them.  I'll have to duble check, but I believe they said before that there would be no inquiry put on my report and that all they needed was updated info. from me. Even after any increase this card will continue to sit in my drawer becuase they don't have any worthwhile rewards.

---

Hi crazycanaler,

It would be good to get an increase as it will slightly lower your overall credit utilization.  You are still very high on a few of your current cards though.  For example, on a couple of your cards you are almost maxed out, and this hurts your score.  The only things you can do about that are:

1. Pay down those cards to less than 30%.

2. Increase the limits of those cards, and hopefully without any hard pulls.

I would caution you though from personal experience to not go overboard by using the cards more, especially if you are not paying them off.  0% is always a good thing, but not so good when there is a max on a credit line limit.

[CreditInspired]

Hi OP
Although you didn't ask, I've read that once the 0% APR expires on Discover, you can ask for an APR reduction. In this MyFICOers case, the cardholder was offered another 0% 12-month interest. Something to think about if you can't get the balance on the Disco paid off by August. Of course, YMMV.

[Anonymous]

I just read my previous post. I think I was getting tired and wrote it as a response to getting a new account and not a CLI. Now that I've slept, let me supplement my answer.

For banks that do not pull your full report (that is they do soft pulls of your credit), there is little risk to your score in accepting a CLI. It will lower your utilization and not ding your credit with an additional inquiry. Discover and Amex are good about this. Citi, too, but you have to pay attention to the words on the page before asking for the CLI. Chase will do a full hard pull of your credit and it'll count as an inquiry. So only do this if you have a specific purpose in mind. Also, Chase is notorious for giving out more credit for new accounts than they would for CLIs. You can reallocate available credit across your Chase accounts easily (if you use Chase that is).

My original caution about masking existing debt with new available credit stands though. It can be risky, but it can also work. However, there are new scoring models that may change this. They aren't currently used widespread, and we don't quite know how they'll be implemented. But there is a chance that having too much available credit can become a risk to your score regardless of how much debt you can actually have. But this is a future issue, and it could be that it will not affect most people.

[SouthJamaica]

---

@Anonymous wrote:

Between recent mortgage inquiries and using credit cards to finance a larger downpayment for a priveate mortgage from my boss, my scores have dropped from the 730s and 740s to 693, 688, and 693. 

I have a couple cards that I rarely if ever use that keep sending me offers to raise my credit limit by several grand.  I'm wondering if I do this (assuming there is no credit inquiry), will it help my scores at all?

I have 9 cards with a total credit limit of $111,100 and total balances of $52,436 as follows:

Discover $8,585/$10,700

Citi Thank You Pref. $2,867/$3,000

Cit Simplicity $9,051/$16,000

US Bank AMEX $13,664/$14,000

BOA Visa $18,269/$26,000

All of them except the Citi Preferred have 0% interest.  I'm planning on paying off the Discover before the introductory rate expires in August.  However, I need to get my score high enough by December to be able to qualify for a balance transfer card to transfer my Citi Simplicity card before it goes from 0% - 24%.

---

Yes it willl help your scores a bit, since your utilization is high.

[Anonymous]

---

@Anonymous wrote:

Between recent mortgage inquiries and using credit cards to finance a larger downpayment for a priveate mortgage from my boss, my scores have dropped from the 730s and 740s to 693, 688, and 693. 

I have a couple cards that I rarely if ever use that keep sending me offers to raise my credit limit by several grand.  I'm wondering if I do this (assuming there is no credit inquiry), will it help my scores at all?

I have 9 cards with a total credit limit of $111,100 and total balances of $52,436 as follows:

Discover $8,585/$10,700

Citi Thank You Pref. $2,867/$3,000

Cit Simplicity $9,051/$16,000

US Bank AMEX $13,664/$14,000

BOA Visa $18,269/$26,000

All of them except the Citi Preferred have 0% interest.  I'm planning on paying off the Discover before the introductory rate expires in August.  However, I need to get my score high enough by December to be able to qualify for a balance transfer card to transfer my Citi Simplicity card before it goes from 0% - 24%.

---

If you can, I would work on getting the UTI on all of  the cards listed under 50%, then shoot for 30%, and then lower.  You should start to see your scores rise again, once UTI is under better control.