Want to know how to get a credit limit increase on your credit card?
During the boom years of last decade (you know, when you could buy a $400,000 house using stated income) it was extremely easy to get credit limits of 10, 20, even 50 thousand dollars on an average income.
Of course times have changed since then so what’s the best way to do it today? Should you simply request a credit card limit increase – or did asking for it fail – and now it’s time to bring out the heavy artillery? Well, I will share with you two different strategies of how to increase your credit card’s limit – the first one is common, the second one isn’t. In fact, credit card companies probably don’t want you to know about strategy #2.
Strategy #1: Plead your case
First of all, the zombies in level one customer support may not be much help. They’re limited in their power when it comes to this. About the only thing they can do is click a “request credit limit increase” button and give you whatever number the computer spits back at them.
Bypass the first tier of support and specifically request to speak to the department that solely handles credit limits. They are known as credit risk departments but surely the issuer will have a more pleasant sounding name that doesn’t have the word “risk” in it.Once you have them on the line, think about it from their perspective: Why should they give you a higher credit limit? If you think it would be beneficial to discuss any of the following, then do it…
- Income: Has your income on file been updated since you’ve had the card? If you have a higher income now make sure to tell them. But don’t fib – they might ask for tax returns as proof!
- Occupation: Each occupation has a different risk rating assigned to it (or in other words, the chance you could be laid off from your job). So keep that in mind when discussing your occupation. I have read posts on the forum where people have accidentally screwed up by misclassifying their occupation – i.e. Saying “manufacturing” when what they actually do is information technology (IT) for a manufacturing company. When you just say “manufacturing” it sounds like you might be an assembly line worker, and hence have less job security.
- Account History: How long have you been their customer? Play this aspect up and remind them how great of a customer you’ve been.
- Credit History: If you have an amazing credit history, say it and give specifics – i.e. I’ve never made a single late payment in my life.
- Current Debt: If you’re in an attractive situation and currently have little to no debt, make sure you tell them.
- Balance Transfers: A lot of times they will make special exceptions for those who are going to be doing a balance transfer to the account.
And as the cardinal rule, banks like giving money to people that don’t need it. If you act desperate and say something like “I need this to pay my car repairs otherwise I won’t be able to get to work” you probably won’t get very far when you request your credit limit increase. To get a higher credit limit, you need to act like you want it but not like you need it.
How much should you ask for?
Don’t try asking the person on the other end of the phone how much you should ask for; all credit card companies prohibit their employees from giving guidance on choosing an amount for a credit card limit increase. You will be on your own with this one.
My advice is to shoot for the moon but not for the stars. This avoids shooting yourself in the foot. If you aim too low, you get less than what was possible. If you aim too high, for an outrageous amount, you might get your account flagged as suspicious and get branded as a credit seeker (meaning, an account review). But if you go for a credit limit increase that is high, but not high enough to raise concerns, then the worst that can happen is they might come back with a lower approved amount than what you originally requested.
Every situation is different so there are no absolutes in terms of percentages or dollars – certainly not any that bank risk managers would ever go on the record admitting. If you are unsure, pose the question on the forum to gauge the advice and experiences of other members.
Strategy #2: The Double-Take
Do you think two is better than one? Then the double-take might be right up your alley…
Have you already attempted to get a higher credit limit and was denied? Or maybe it was increased, but it wasn’t raised as much as you would like? Well, that’s where the double-take can save the day…
In a nutshell, what you do is apply for a second (new) credit card from the same bank and then after you are approved, you re-allocate some of that credit limit to your other card (the one you want to have a higher limit).
For example, let’s say your current credit card has a $14k limit. You can try applying for a second (different) card with them and then re-allocating your credit lines. Assuming you have great credit and no reason to be denied for a new card, the odds of approval are probably good. That’s why this is my preferred method.
I have used this strategy a number of times to increase my credit cards’ limits by tens of thousands of dollars. Here’s my most recent example of doing this during summer 2013:
Step 1: I applied for this killer British Airways card offer
Step 2: Since my credit limit on the new card was higher than I needed for it, I called up Chase to transfer $8,000 of the credit limit to my Chase Freedom which had a $12,600 limit.
Step 3: The end result? My Freedom now has a $19,600 credit limit. That’s over 50% higher than what it was before!
Do you have a Chase card? If so try getting another one that you don’t already have. Here are their best offers for 2014 (which I constantly update): Marriott Rewards, Slate, Sapphire Preferred, and Freedom.
Want a higher limit with American Express? Then read this article about strategies for AmEx.
Got tips on how to increase a credit card’s limit? Post them in the comments below!