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Increasing credit limit

Eschaton
Regular Contributor

Increasing credit limit

Hi everyone,

 

I recently bought a car and got really bad interest rate at 4.9%. The finance guy said I should try to get a higher credit limit. I didn't think of it at the time, but I was wondering what is the best approach to doing this?

 

Thanks Smiley Happy

Capital One Journey (12/2010) $750 | Chase Freedom (03/2012) $3500 | American Express Zync (03/2012) NSPL | Amazon Prime (08/2018) $6000 | Chase Sapphire Preferred (10/2018) $8000 | Bank of America Cash Reward 10/2018 $8000 | Chase Freedom Unlimited 06/2019 $2700

Experian score: 793 (9/2018)
Message 1 of 9
8 REPLIES 8
pizzadude
Super Contributor

Re: Increasing credit limit


@Eschaton wrote:

Hi everyone,

 

I recently bought a car and got really bad interest rate at 4.9%. The finance guy said I should try to get a higher credit limit. I didn't think of it at the time, but I was wondering what is the best approach to doing this?

 

Thanks Smiley Happy


4.9% isn't the worst rate, but assuming your FICO score is over 750 then you could probably beat it.

 

Is the finance guy is implying that you need a higher FICO score to get a better rate??

March2010 FICO® ~ 695 TU, 653 EQ, 697 EX
Message 2 of 9
EW800
Valued Contributor

Re: Increasing credit limit

Although 4.9 is not great, we have seen WAY worse here. I recall a couple of message where people were trying to figure a way out of a 25% or worse auto loan. THAT would be painful....
Year 2012: All Scores in the 520 range, during a foreclosure, CC Settlement and high UTIL. Very ugly days...
Jan 2021: EX8: 850; EQ8: 850; TU8: 850 -- Middle Mortgage Score: 824
In My Wallet: Discover $73.7K; Cap1 Venture $42.7K; Amex ED $38K; Amex Optima $2.5K; Amex Delta Gold $18K; Citi Costco $21K; Cap1 Plat $8.4K; Barclay $7K; Chase Amazon $6K; BoA Plat $21.6K; Citi TY Pref $19K; US Bank $4K; Dell $5K; Care Credit $6.5K. Total Revolving CL: $285K
My UTIL: Less than 1% - Only allow about $10 a month to report, on one account. .
Message 3 of 9
mongstradamus
Super Contributor

Re: Increasing credit limit


@EW800 wrote:
Although 4.9 is not great, we have seen WAY worse here. I recall a couple of message where people were trying to figure a way out of a 25% or worse auto loan. THAT would be painful....

it shouldn't even be legal to get stuck in loans that are that high 



EX Fico 804 11/16/16 Fako 800 Credit.com 11/16/16
EQ SW bank enhanced 11/16/16 839 CK fako 822 11/16/16
TU Fico discover 10/19/16 814 Fako 819 Creditkarma 11/16/16
Message 4 of 9
Eschaton
Regular Contributor

Re: Increasing credit limit

He said my score is fine, it's just my low credit limit. I have a Chase Freedom at $1000 and a Capitol One at $750. I'm assuming he was implying that. 

 

My interest rate isn't of utter importance, since I am paying it off within a year. 

 

He just advised for me to increase my credit limits on my credit cards. I am in college, and I just took a loan from them that I put into another bank account that I'll just return in full when I am done. 

Capital One Journey (12/2010) $750 | Chase Freedom (03/2012) $3500 | American Express Zync (03/2012) NSPL | Amazon Prime (08/2018) $6000 | Chase Sapphire Preferred (10/2018) $8000 | Bank of America Cash Reward 10/2018 $8000 | Chase Freedom Unlimited 06/2019 $2700

Experian score: 793 (9/2018)
Message 5 of 9
pizzadude
Super Contributor

Re: Increasing credit limit


@Eschaton wrote:

He said my score is fine, it's just my low credit limit. I have a Chase Freedom at $1000 and a Capitol One at $750. I'm assuming he was implying that. 

 

My interest rate isn't of utter importance, since I am paying it off within a year. 

 

He just advised for me to increase my credit limits on my credit cards. I am in college, and I just took a loan from them that I put into another bank account that I'll just return in full when I am done. 


Well it wouldn't hurt to increase your CLs, aside from the inquiry that may come along with it, but your auto loan interest rate is based on many different factors ( make, model, income, previous loans negotiation, etc... ).   As you stated it doesn't really matter since you'll be paying it down quickly.   You should qualify for the best rate on your next loan though.

 

 

March2010 FICO® ~ 695 TU, 653 EQ, 697 EX
Message 6 of 9
takeshi74
Senior Contributor

Re: Increasing credit limit


@Eschaton wrote:

I didn't think of it at the time, but I was wondering what is the best approach to doing this?


Request a credit limit increase from your creditors.  However, your odds of CLI all depend on your credit and income.  If your credit is lacking in one or more areas then you may want to address that first.

Message 7 of 9
xXIDaShizIXx
Established Contributor

Re: Increasing credit limit


@EW800 wrote:
Although 4.9 is not great, we have seen WAY worse here. I recall a couple of message where people were trying to figure a way out of a 25% or worse auto loan. THAT would be painful....

I had a coworker that got a car for 23% because her credit was terrible because of medical collections. I couldn't come to grips with that.

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Message 8 of 9
PedrokiPR
Valued Member

Re: Increasing credit limit

Hahah 4.9% I wish I would've had that when I opened my second loan on a car. My first loan for a car was when I was 21 years old, now after 7 years it's on schedule deletion on December ! Yaii! Anyways, on May 2012 I financed a car through CNAC (JD Byrider), yeah........................., I have made all payments on time, and I am even a year ahead in schedule. I was approved for a used car (that I love and have really took care) at a crazy rate of 19.99%. So, yeah, I have paid so far on interest over $3.5k and I will finish paying it this October 31st. I can't wait!!! So I saved 1k on interest by paying ahead and no penalty as stated on my contract. Anyway! Good luck, I wish 4.9% would have been applied to me lol

Message 9 of 9
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