GoCreditGo! wrote:N00b question: CLI = credit limit increase, right?
I see many posts about getting CLIs. Why are so many people seeking (maybe obsessing) over CLIs?
For many of us, it's not the credit line increases themselves, but what it does for utilization. I'll use myself as an example... my total available credit just jumped from around $10,000 to $20,000 (from a new card, not from a CLI, but the principle is the same). On average, my reported balance is around $1000 every month(it varies, but it's anywhere from $500 to $1500- I always pay in full, though). So before my utilization was around 10%, but with the new available credit, it will now be 5%. That's important because utilization is around 30% of your credit score. I could probably get the utilization lower(by paying before the statements hit on my cards) even at $10000, but it's easier to do when you have higher available credit. So it's not that I'm going to go out and buy a bunch of crap, it's that I don't have to obsess about paying before the statements hit on my cards, etc.
Of course, it would be better to get a CLI than to apply for another card(as I did) since it's often a soft pull whereas new cards are a hard pull.
There's also the fact that higher credit limits beget more higher limits. Often it takes one creditor to raise your limit and it has a cascading effect and then a bunch of creditors follow shortly thereafter.
In my Wallet:
Sometimes in my Wallet:
- Amex PRG NPSL[3-14, bd 91]
- Sallie Mae MC $8000[1-14]
- Chase Freedom $4700[1-14]
- Discover It $2750[8-13]
- BoA UCF Alumni Cash Rewards $5000 [3-15]
- GM BuyPower WEMC $5000[9-14]
- Wells Fargo Propel 365 Amex $7000[4-14]
- Barclaycard Arrival WEMC $7000[3-14]
- BoA Better Balance $3000[2-15]
In my sockdrawer: Amex BCE $1000[10-13, bd 91], OCCU Duck $10000 [11-13], The Sportsman's Guide Visa $8000[8-14], Chase Slate $4000 [9-14]Delta Gold Amex $2000 [2-15 bd 91], Diners Club MC $20000 [10-14] Commerce Bank Visa $2000 [3-15] Citi Double Cash $1000 [3-15]
Total CL: $90450