Credit Cards

7 Steps To Increase Your Credit Card Limit
Doug Smith

Defined Tag: Credit Card Limit.
If you need a higher credit card limit, then you probably are handling your debt well enough to deal with the increased financial responsibility. A higher limit means more purchasing power with the bank card, but also a potential increase in debt. Here are some ways to prove to the major banks that you are ready for a higher Visa, MasterCard, or Discover limit.

1. Make sure you have good credit before requesting the increase. The banks will check your credit report to ensure that you pay your debts responsibly.

2. If you pay off your account limit in full every month, stop doing it for a month or two. Show the banks that you are willing to pay a finance charge once in a while. This shows the issuing bank that they might be able to make more profit from you.

3. Don't spend more than your card's current limit. This is another way to demonstrate your financial responsibility.

4. Use your cards regularly, not just for infrequent emergencies. Regular use shows the card issuers that you are a legitimate paying customer and user of their services. It also demonstrates your current spending and payment habits. Once the issuing bank knows that you are a frequent customer in good standing and that you pay your bills on time, it may be more inclined to grant a higher spending limit.

5. Pay more than the minimum amount each month. Pay the entire remaining balance each month if you can, except as noted in Step 2 above. If you can only afford to make the minimum payment each month, why should the bank give you even more credit? Show the bank that it is wrong!

6. Never pay late. This increases your minimum payment and incurs additional fees. If you think your payment might be late, call the accounts receivable department of your card issuer before the due date and explain the situation. Pay as much as you can. Late payments might also negatively impact your credit score, causing two reasons why the card limit increase request might be denied.

7. Ask for the higher limit. If you've been a good, loyal and responsible customer, call the card company and request a higher limit. If they are reluctant to grant more credit to you, tell them there are other card companies that will give you a higher upper credit limit, and you'll be glad to cancel your existing card and move to a new card. The bank might just be more willing to increase your spending ceiling in that case.

Once you get the raise, don't overindulge the extra spending power. A higher credit card limit can help you buy more expensive items and pay over time, but it can also increase your debt if used unwisely.

This article is Copyright 2009 by Doug Smith. All Rights Reserved Worldwide. Unauthorized Duplication Prohibited. For Entertainment Purposes Only. Not Intended As Financial Advice. Consult Your Own Financial Professional.