Why would my score decrease with higher credit limit?

[Rith]

Hello,
I moved here from Europe and am just getting used to Fico scores. I opened 2 credit cards last year. Length of credit history is 1 year and 2 months. I was trying the Fico simulator to see what I can do to increase my score (btw, would love to know how, if you have any advice!).
When I tried to simulate raising my credit limit on existing cards by any amount, the simulator predicted a drop of 10-15 points in Fico Scores!
Why would that happen? I thought that was a good thing! I'm a little scared now, because my cards randomly increase my limit every once in a while, and I'm trying to raise my scores for a mortgage!

Overview: 1.2 year length of history, two credit cards only, no late payments ever, not yet letting one card go to statement, but planning to start soon. Current scores: Eq: 736  TU: 743  Exp: 721 

I would highly appreciate any advice!  Thank you!

[GatorGuy]

The credit simulators are completely unreliable. You would not lose points for increasing credit limits.

[Rith]

Oh! That is good to know! Thank you very much!

I was hoping to use them to educate myself on what I should and shouldn't do. Do you have any recommendations on how to raise my score? Like, indeed, raising my line of credit with existing cards?
Thank you!

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@GatorGuy wrote:

The credit simulators are completely unreliable. You would not lose points for increasing credit limits.

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[SouthJamaica]

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@Rith wrote:

Hello,
I moved here from Europe and am just getting used to Fico scores. I opened 2 credit cards last year. Length of credit history is 1 year and 2 months. I was trying the Fico simulator to see what I can do to increase my score (btw, would love to know how, if you have any advice!).
When I tried to simulate raising my credit limit on existing cards by any amount, the simulator predicted a drop of 10-15 points in Fico Scores!
Why would that happen? I thought that was a good thing! I'm a little scared now, because my cards randomly increase my limit every once in a while, and I'm trying to raise my scores for a mortgage!

Overview: 1.2 year length of history, two credit cards only, no late payments ever, not yet letting one card go to statement, but planning to start soon. Current scores: Eq: 736  TU: 743  Exp: 721 

I would highly appreciate any advice!  Thank you!

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1. Simulators are rubbish.

2. Your scores would not decrease with a higher credit limit.

[Rith]

Thank you so much! That's good to hear.

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@SouthJamaica wrote:

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@Rith wrote:

Hello,
I moved here from Europe and am just getting used to Fico scores. I opened 2 credit cards last year. Length of credit history is 1 year and 2 months. I was trying the Fico simulator to see what I can do to increase my score (btw, would love to know how, if you have any advice!).
When I tried to simulate raising my credit limit on existing cards by any amount, the simulator predicted a drop of 10-15 points in Fico Scores!
Why would that happen? I thought that was a good thing! I'm a little scared now, because my cards randomly increase my limit every once in a while, and I'm trying to raise my scores for a mortgage!

Overview: 1.2 year length of history, two credit cards only, no late payments ever, not yet letting one card go to statement, but planning to start soon. Current scores: Eq: 736  TU: 743  Exp: 721 

I would highly appreciate any advice!  Thank you!

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1. Simulators are rubbish.

2. Your scores would not decrease with a higher credit limit.

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[GatorGuy]

Long term adding a 3rd credit card and an installment loan would help you maximize your scores. Ideally you would only let one credit card report a small balance each month. You don't have to carry a balance or pay interest though. From there just give it time and let your score grow. To get high credit limits the best thing you do is use your cards as heavy as possible and pay in full each month.

[MrFiah]

Agreed with everyone else that simulators are unreliable but you might see a small dip in your scores in the event that a HP is done for the CLI.

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@Rith wrote:

Hello,
I moved here from Europe and am just getting used to Fico scores. I opened 2 credit cards last year. Length of credit history is 1 year and 2 months. I was trying the Fico simulator to see what I can do to increase my score (btw, would love to know how, if you have any advice!).
When I tried to simulate raising my credit limit on existing cards by any amount, the simulator predicted a drop of 10-15 points in Fico Scores!
Why would that happen? I thought that was a good thing! I'm a little scared now, because my cards randomly increase my limit every once in a while, and I'm trying to raise my scores for a mortgage!

Overview: 1.2 year length of history, two credit cards only, no late payments ever, not yet letting one card go to statement, but planning to start soon. Current scores: Eq: 736  TU: 743  Exp: 721 

I would highly appreciate any advice!  Thank you!

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[FireMedic1]

Welcome to the forums @Rith 

Think of yourself as a teenager who got their first card. Right now your brand new to the credit world. You'll want to build a strong foundation and go from there. Main thing no baddies as you grow your profile. Move slowly without rushing to grab all thats out there. Theres no rush. Its a marathon and not a race as we say. For now your looked at as a young and thin file. It will take a few yrs to have a solid file. As mentioned. Three cards and any type of loan. If you have a auto loan or any other loan right now. More loans dont mean higher scores. Put your effort into building a file. The scores will follow.  Scores decrease when you let too high of a balance report on your cards compared to your credit line.

[Anonymalous]

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@Rith wrote:

Hello,
I moved here from Europe and am just getting used to Fico scores. I opened 2 credit cards last year. Length of credit history is 1 year and 2 months. I was trying the Fico simulator to see what I can do to increase my score (btw, would love to know how, if you have any advice!).
When I tried to simulate raising my credit limit on existing cards by any amount, the simulator predicted a drop of 10-15 points in Fico Scores!
Why would that happen? I thought that was a good thing! I'm a little scared now, because my cards randomly increase my limit every once in a while, and I'm trying to raise my scores for a mortgage!

Overview: 1.2 year length of history, two credit cards only, no late payments ever, not yet letting one card go to statement, but planning to start soon. Current scores: Eq: 736  TU: 743  Exp: 721 

I would highly appreciate any advice!  Thank you!

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Are those your FICO 8 scores? Just be aware mortage lenders tend to use FICO EX 2, TU 4, and EQ 5. They often take the middle of the three scores.

But those are good scores, you're probably fine. Just keep doing what you're doing. You're not in the ideal range (760+), but that would be tough to achieve with your short credit history. In the long term you might want to add an extra card or three, but if you're going to be applying for a mortgage in under 12 months, don't even think of adding any new lines of credit. Mortgage scores are also sensitive to utilization, so keep it very low. Raising your limits is a good thing not a bad thing, and will help with utilization.

[Rith]

Thank you all so much!