Too much available credit?

[Superk88]

So my wife has a Navy fed card and I'm a AU. 25k limit

I just got a Navy fed card with her as a AU 11k limit

We pay off weekly, the balance reportedly monthly is less thatn 2% utilization.

Is this too much pretty much on both our credit reports we will have 36k available credit.

Should I see a score increase since I have my own card now? Just applied and was approved today.

[reluctantgarden]

"Too much" credit can only be defined in relation to your household income, at least in the eyes of CCCs deciding whether you "need" additional credit. For example, it's apparent that my profile shows I have sufficient credit so new apps are being denied, with my TCL at 1.28x my annual household income. Some folks here have higher ratios that aren't maxed out, but my mortgages and other loans probably play a part as well. 

[Absolution16]

In the interest of seeking new credit cards, NOT for more CLs, but for desire to seek better earning structure, I wonder if it is a good strategy to voluntarily request CLDs on some cards that may have become "overblown" with needlessly high CL.  If I have a card with a 30K CL, but I only spend 1 or 2K every month on it and PIF every time, that is clearly an unnecessary CL.  I guess it looks like a nice cushion for credit utilization padding, but I can clearly see how any lenders can view this as excessive and take AA if they choose to do so.

If possible, any new credit card application with the same lender in which you have a card with an unnecessary "overblown" CL with them, can be asked for the bare minimum CL that the new card requires, and transfer the CL around if necessary?

I am not sure if this is either optimal or right way to look at things, but it would surely be nice NOT to be denied for a desired credit card simply due to having too much credit relative to our income level.

[Traveler101]

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@Superk88 wrote:

So my wife has a Navy fed card and I'm a AU. 25k limit

I just got a Navy fed card with her as a AU 11k limit

We pay off weekly, the balance reportedly monthly is less thatn 2% utilization.

Is this too much pretty much on both our credit reports we will have 36k available credit.

Should I see a score increase since I have my own card now? Just applied and was approved today.

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If you are worried about Navy, don't sweat it. They will show you lots of love over time.

If you are worried about too much available credit limits, I earn 85k+ per year. 220k available cl. While some lenders concern themselves with availability of cl, there are others who don't. For example, one may deny you for too much, then go to another and apply and get 25k. Lenders vary. 

Focus most on your utilization and keeping that in check. And your new card will raise your score over time when used responsibly. Each profile is different. Generally we all take a modest hit when we open new accounts. Scores rebound over time, again, when used responsibly.

Best of luck on your journey and congratulations on your new card.

[805orbust]

In short, you're good.  Thise guys are great and you are nowhere near their threshold.   As a side note, FICO scores are optimized when you have 3 open cards with 2 at zero balance and 1 under 10%.  Don't go out and go crazy but it may be a decent milestone to shoot for over the next 12-24 months 🙂

[Superk88]

Thanks guys, right now our overall goal is to get my mortgage score to a 720 so we can build.

I am the only one with income as my wife is a stay at home mom.

 I make 80k a year

Her car debt is 25k which is our family car.

I have a 13k loan which will be paid off in august

And we each have a CC as stated above. 

I love Navy Fed. I will use them when whan I purchase a new car, for now I'm driving my 97 paid for silverado until I can get less that 10% interest rate lol.

[1GaDawg85]

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@Superk88 wrote:

Thanks guys, right now our overall goal is to get my mortgage score to a 720 so we can build.

I am the only one with income as my wife is a stay at home mom.

 I make 80k a year

Her car debt is 25k which is our family car.

I have a 13k loan which will be paid off in august

And we each have a CC as stated above. 

I love Navy Fed. I will use them when whan I purchase a new car, for now I'm driving my 97 paid for silverado until I can get less that 10% interest rate lol.

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honestly, you are below what most companies would consider "too much credit". Now, do you need to go wild and open up 4 new cards hoping to swing 10k credit limits and up, not even close. But take a look at where you spend your money and could you optimize your reward-earning potential by opening a new card or 2. That would be my goal if I was in your position. 3 solid earning credit cards for you and 3 solid earning cards for your DW and they don't have to all be the same. The less overlap, the better!

Hope this helps!

[OmarGB9]

Some lenders may care, but for the most part, no, you can't have too much credit.

[Anonymalous]

Most lenders don't seem to have a problem with handing out significantly more revolving credit than your yearly income, and you're nowhere near that.

The most conservative tend to be smaller institutions, like many credit unions (Navy, obviously, doesn't qualify), though they may look at recent credit increases as opposed to total overall CL -- I recently got rejected by a good sized CU not because I had too much credit, but because I added $30K in credit in the last year (I'm now up to $45K or so). Their objection wasn't the total CL, but that I'd acquired it relatively recently, and that was probably compounded by the fact that I'm a relatively new file (<2 years).

[Thomas_Thumb]

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@Superk88 wrote:

So my wife has a Navy fed card and I'm a AU. 25k limit

I just got a Navy fed card with her as a AU 11k limit

We pay off weekly, the balance reportedly monthly is less thatn 2% utilization.

Is this too much pretty much on both our credit reports we will have 36k available credit.

Should I see a score increase since I have my own card now? Just applied and was approved today.

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You may see a score drop due to adding the new account. The new account penalty, typically 15 to 20 points, is triggered if your prior most recent account was more than 12 months old. The impact of the new account penalty on score should lessen in 3 months and disappear in 12 months.

In your case, the new account penalty will be offset by establishing revolving credit on an account where you are a primary card holder. The net result should be a score gain in 3 to 6 months with continued increases as the account ages past 1 and 2 years. I would suggest getting a 2nd card in 6 months to further build credit history and boost score.

The closure of your only open loan likely will have a negative impact on your Fico 8 scores - perhaps 30 points. Those algorithms want to see an open/active installment loan on file. Some people get a small share secure loan (SSL) and immediately pay balance down to 9% for the sole purpose of boosting score.

FWIW - a revolving aggregate CL of 1x annual income is generally not considered a risk. You are around 0.4x even with the AU so no concern at all. DTI for mortgages factors in minimum payments as shown on statements plus monthly installment loan obligations. Does not look at credit limits.