How to Effectively Ask for a Raise in Your Credit Limit

Your credit cards work for you, as long as you know how to ask. You can get more benefit out of your credit cards by asking for a raise in your credit limit. With a higher credit limit, you can improve your credit score and show potential creditors that you can manage a higher amount of debt.

When to ask for a higher limit

When you first apply for a credit card, you are assigned a credit limit by the issuing company. The initial credit limit is usually based on the level of income and your current credit score. Usually after a period of time, you have proven that you can easily handle your assigned credit limit, and thus, you can request that your limit be raised.

Though a credit limit will be assigned to you up front, you could still request a raise in your limit upon approval in order to accommodate a balance transfer from other credit cards. Oftentimes, a credit card company will offer incredibly good initial (though temporary) interest rates and encourage you to transfer other credit card balances into your new credit card account. If you have a sufficient credit score and a current combined credit card balance greater than the new limit assigned to you, a new credit card company will oblige a request for an initial credit limit raise.

If you do not have a reason to ask for a credit limit raise up front, you can ask as early as six months after you are approved with a new credit card. If you can show sufficient financial manageability of your new credit card, you can request the credit company for a specific raise in your limit. Usually your request will need to be in writing, or some companies allow you to request a credit limit raise when you log-on to your online account management website.

How much of an increase to expect

Asking for a raise in your credit doesn’t mean asking for an outrageous amount. For instance, if you have been granted an initial credit limit of $5,000, it is not prudent to request a new credit limit of $30,000. Usually credit card companies will grant a new credit limit up to a few thousand dollars. With your credit limit of $5,000, it is perfectly acceptable to ask for a new limit of $7,000.

Your credit card company will usually have an answer for your request within 48 to 72 hours and will send their approval or denial in writing. In some cases, your credit card will counter-offer your request with a credit limit somewhere between your current limit and the amount of your request. To continue using the example from above, if you requested a $2,000 raise on your $5,000 limit, your company may send you notice that they have approved a $1,000 raise, putting your new limit at $6,000.

Asking for a raise in your credit limit doesn’t necessarily mean you are going to spend more and rack up charges on your new credit limit. One good strategy in raising your credit limit is refraining from charging more. With a higher available credit limit and lower balance, your credit score will improve over a short amount of time.

Whether you are looking to improve your credit score or utilize higher credit limits for major purchases, don’t be afraid to stand up and make the request to your credit card company. As long as you prove you are creditworthy and can manage higher debt, credit card companies are usually more than willing to grant your request.

Write to Grace Carter at grace@creditdonkey.com

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