So it's well known that when you apply for a new card, creditors look at your other credit limits when setting your starting limit. They are very unlikely to give you 30,000 starting limit if your highest limit is 2,000. It's too big of a jump.
my question is, how much of an impact do your other limits have on CLI's. For example let's say you have 4 cards.
card 1-2k limit
Card 2-2500 limit
card 3- 1500 limit
card 4-5k limit.
now let's say card 4 is the most generous when it comes to CLI's. And you are due for another CLI, let's say they are considering increasing you from 5k to 10k.
are they less likely to give you an increase because the limits on your other 3 cards are much lower? or does that only impact the starting limit on the card?
thanks for your response.
But some creditors are known to grow way faster. Amex is known for their 3x increases while cap one is known for bucketing and $100 increases. so if 1 card outgrows the others by a large margin the credit limit will end up being much larger than the others. So if 1 card is way above the others in terms of credit limit, will it start to affect the growth of said card, since that company is taking on more risk than the others by extending more credit? Scenario below
card 1 is an Amex that started with $1000 limit
Card 2 is a cap 1. Started at $1000
card 3 navy fed that started at 1000.
so all the cards started with the same limit, now fast forward 18 months.
amex got 2 CLI, each one tripled ur previous limit, making the new limit 9k
cap 1 grew to $1500
Navy fed grew to 2000,
now let's say you are due for another CLI with Amex, if they were to triple your limit again, that would give you a 27,000. But your other cards are still stuck at $1500 and $2000. Will this hurt your chances of getting the CLI with Amex? Due to the fact that your cap 1 and navy fed cards have limits that are so much lower?
@Gregory1776 wrote:As creditors see your usage and profile grow, and depending on your income and spending habits (healthy, within means) your credit limits will increase with time. They're going to grow steadily until they feel you have too much credit based on how much you use / income level.
@Gregory1776 mentioned some important factors -
- Usage of that card account
- Income
- Profile
To clarify profile can include a LOT of other factors including total Debt relative to Income (including installment debt), FICO score, utilization on aggregate revolving accounts, and recent credit-seeking / new accounts.
@Cblough93 wrote:thanks for your response.
But some creditors are known to grow way faster. Amex is known for their 3x increases while cap one is known for bucketing and $100 increases. so if 1 card outgrows the others by a large margin the credit limit will end up being much larger than the others. So if 1 card is way above the others in terms of credit limit, will it start to affect the growth of said card, since that company is taking on more risk than the others by extending more credit? Scenario below
card 1 is an Amex that started with $1000 limit
Card 2 is a cap 1. Started at $1000
card 3 navy fed that started at 1000.
so all the cards started with the same limit, now fast forward 18 months.
amex got 2 CLI, each one tripled ur previous limit, making the new limit 9k
cap 1 grew to $1500
Navy fed grew to 2000,
now let's say you are due for another CLI with Amex, if they were to triple your limit again, that would give you a 27,000. But your other cards are still stuck at $1500 and $2000. Will this hurt your chances of getting the CLI with Amex? Due to the fact that your cap 1 and navy fed cards have limits that are so much lower?
@Cblough93, is the example above hypothetical or based on a real-world example? Your numbers and assumptions don't seem completely realistic to me. For one, Capital One doesn't ALWAYS bucket. Sometimes even low limit cards are not bucketed with them. Also, the 3x CLI with AMEX doesn't mean they keep doing it over-and-over! It's typically a one-time good deal. Navy Federal going from $1K to $2K sounds low to me unless your internal score with them is very subpar. They can be quite generous. So your example of $1k - $1k - $1k changing to $9K - $1.5K - $2K in 18 months is unlikely. If AMEX raised your CL that much, it might be due to a much higher income, lower debt, or other positive changes that would lead most other lenders to follow suit. On the other hand, if nothing changed in profile, they would probably all be fairly close after 18 months.
Yes, your existing credit limits are typically one consideration for both starting limits as well as overall limits. Over time, assuming the above variables that @Gregory1776 and I mentioned are in order, most of your limits will tend to slowly increase together. Yes, some may rise more quickly than others but they will tend to stick pretty well together. With few exceptions, you'll probably find having one outsized limit is rare. For example, Navy FCU is known to get very generous limits relative to income that other lenders may not be willing to match.
the scenario was hypothetical but I tried to keep the data points somewhat realistic and base it on some real life info. the numbers weren't necessarily meant to be super realistic. I made those numbers up intentionally for the purpose of my question. I also just picked 3 company names randomly, if exchanging navy fed with citi bank helps my scenario make more sense that's fine.
I also didn't know that about Amex, I thought they continued to triple your credit line each time until you hit 30 grand, at which point a FR is usually required to go higher than that. I had seen posts about people who had the Amex blue card and they went from 3k starting to 9k, then to 27k. So they were tripled twice in a row. But maybe they got lucky?
Also, I didn't mention this originally, but there are also credit limit reallocations. So if you combined a few credit limits for 1 of your cards. it's very possible to have 1-2 cards with limits way higher than the rest.
I had a feeling your other limits would affect the ability to get CLi's on other cards. With that said, Just because it makes sense that doesn't mean I agree with it.
if your capital one card was bucketed and they only raise your limit $100 every 6 months despite credit profile and score improvement and perfect history, why should that affect your chances of getting an increase with another company? How is that your fault?
granted, most people cancel their bucketed cards and re apply to get a bigger limit. But that's a pain for everyone involved.
When you say navy fed are doing 8k increases are you saying navy fed would go from 1k to 9k?
Also I'm sure you can get FR much lower than 30k, I was more saying a lot of people have mentioned that Amex doesn't like going above 30k limits without some sort of proof you can afford to pay that all back. So if you manage to get to 30k without ever having a FR, you are likely to get one if you want a higher credit line. At least that's what I have seen from other posts.
@Jnbmom wrote:I agree with @Aim_High those scenarios don't make sense, I can't ever remember seeing navy go from 1K to 2K they seems to be stuck on the 8K max increases these days . Cap one is not always bucketed. And AMEX is not going to just continue 3Xs limit every 181 days
And 30K isn't always the magic number for FR I have seen it asked for much lower .
Just to clarify also, @Cblough93, there is a big difference in FR (Financial Review) versus IV (Income verification) with AMEX. IV is common but FR is not; it's more thorough and used when fraud or inaccurate reporting is suspected. IV, on the other hand, just wants to see that income is what you claim. And yes, the point where IV begins will vary. Instead of $30K, I've most recently seen $35K is the typical lower end. In my case, they began to question it once I reached $75K. They can ask for FR or IV at most any credit limit. YMMV.
@Cblough93 wrote:
I had a feeling your other limits would affect the ability to get CLi's on other cards. With that said, Just because it makes sense that doesn't mean I agree with it. if your capital one card was bucketed and they only raise your limit $100 every 6 months despite credit profile and score improvement and perfect history, why should that affect your chances of getting an increase with another company?
Just to clarify, having one or two low limit cards won't keep your overall profile and other cards from growing if your profile deserves it. If you have continued to open other cards to meet your credit needs, you might still have a couple of low limit or store cards open but other cards can grow into much higher limits. The key would be to not let those low limits hold you back by diversifying into other cards as your profile is worthy. So yes, a bucketed Capital One card may not grow but over time it becomes an insignificant part of your credit profile if you elect not to close it.