How to Increase Your Credit Limit Without Hurting Your Credit

Independent guide - not affiliated with or endorsed by any card issuer, bank, card network or credit bureau. Check the terms of your own account through your issuer's official website, app or statements.

To increase your credit limit, ask your card issuer for a higher limit through its app or website, or by contacting it, after a stretch of on-time payments and with up-to-date income on file. Many issuers also raise limits automatically. A request may trigger a hard credit inquiry, so ask which type of check the issuer uses before you submit it.

Knowing how to increase your credit limit is useful: a higher limit gives you more room for emergencies and can lower your credit utilization, one of the biggest influences on your credit scores. It can also tempt you to spend more, so it is worth knowing how issuers decide, what the request does to your credit report and what to do if the answer is no. This guide covers those points for US cardholders, based on Regulation Z and guidance from myFICO.

How issuers decide on a credit limit increase

Federal rules require a card issuer to consider your ability to make the required payments before it raises your limit. Regulation Z section 1026.51 applies this ability-to-pay test to credit limit increases as well as to new accounts, whether you asked for the increase or the issuer offered it. The issuer looks at your income or assets and your current obligations, and it may also use your credit report and credit score.

In practice, the factors that tend to help are:

• A record of on-time payments on that card and your other accounts.
• Time with the account. Issuers often want to see several months of history before they review a limit.
• Income that has grown, and that the issuer knows about. Update your income in your online account if it has risen.
• Moderate use of the card. Regular use paid off on time shows the account is active and managed well.
• No recent problems, such as late payments, returned payments or a jump in debt elsewhere.

If you are under 21, the rules are stricter: issuers must see independent income, or the account must have a cosigner. Our guide to minimum income requirements for credit cards explains what counts as income.

How to ask for a higher credit limit, step by step

1. Check your own reports first. Get your free reports at AnnualCreditReport.com and fix any errors before the issuer looks at your file.
2. Find the request option. Most large issuers have a "request credit limit increase" option in the account settings of their app or website. If you cannot find it, use the contact options on the back of your card or the issuer's official site.
3. Ask what kind of credit check is used. Some issuers decide using a soft inquiry, which does not affect your scores; others pull a full report, which records a hard inquiry. If the terms do not say, ask before you submit.
4. Give accurate, current details. Expect to confirm your income, housing payment and employment. Never overstate income on a credit application.
5. Request a sensible amount. A reasoned request tied to your actual spending is easier to approve than an arbitrary large number.
6. Keep the outcome. Save any approval or decline message along with the new limit and its effective date.

Automatic increases

Many issuers review accounts periodically and raise limits without being asked, usually after a period of on-time payments and income updates. These reviews generally rely on account data and soft checks. You do not have to accept a higher limit; if you prefer a lower one, you can usually ask the issuer to reduce it.

Does a credit limit increase affect your credit score?

It can, in two different ways.

• The inquiry. If the issuer uses a hard inquiry, myFICO explains that it may lower your FICO Score slightly, and inquiries only count in FICO Scores for 12 months, even though they stay on your report for two years. A soft inquiry has no score effect. See our guide on whether applying for a card hurts your score for how inquiries work.
• Utilization. Amounts owed is the second-largest factor in FICO Scores, after payment history. If your balances stay the same and your total limits rise, your utilization ratio falls, which tends to help. Our guide to credit utilization shows the math.

The benefit disappears if the new room is spent. A higher limit only helps your finances if your balance stays the same or falls.

If your request is declined

Under the Equal Credit Opportunity Act and Regulation B, when a creditor takes adverse action on a credit request, it must tell you the specific reasons or how to ask for them. Read that notice: it often points to a fixable cause, such as high balances, a short account history or recent late payments. If the decision used a credit report, the notice also tells you which bureau supplied it and that you can get a free copy.

Wait a few months, work on the reasons given, update your income and try again. Meanwhile, paying down balances lowers your utilization just as effectively as a higher limit.

Other ways to get more available credit

• Move limit between cards. Some issuers let you shift part of one card's limit to another card you hold with them.
• Graduate from a secured card. If you started with a secured card, ask how the issuer reviews accounts for an upgrade or a higher limit; see secured vs unsecured credit cards.
• Keep older cards open. Closing a card removes its limit from your total, which can push utilization up. Our guide on whether it is bad to close a credit card covers the trade-offs.
• Open a new card only if you need one. A new account adds a limit but also a hard inquiry and a younger average account age.

A note on over-limit transactions and decreases

Issuers can lower limits as well as raise them. Under Regulation Z, an issuer cannot charge you an over-the-limit fee unless you have opted in to over-the-limit transactions, and if it cuts your limit, it must give notice before charging an over-limit fee or penalty rate because of the new, lower limit. If you have not opted in, a purchase that would take you over the limit is normally declined rather than charged a fee. If your limit is cut, the same adverse action notice rules apply, so you will get the reasons or be told how to request them.

Sources

• CFPB: Regulation Z, 12 CFR 1026.51 (ability to pay, including credit limit increases)
• CFPB: Regulation Z, 12 CFR 1026.56 (over-the-limit opt-in)
• CFPB: Regulation B, 12 CFR 1002.9 (notifications and adverse action)
• myFICO: How long do hard inquiries stay on your credit report?
• myFICO: What's in my FICO Scores?
• AnnualCreditReport.com: free credit reports