Credit Boost Blog
High Limit Credit Cards and How to Get Them
Our clients frequently ask how to get high limit credit cards. Many people are tired of only getting approved for low limits, like $300 and $500.
Therefore, we are sharing 3 tips for getting those high limit credit cards.
Before we get into the tips, it is important to understand the difference between a credit card’s “high balance” and the “balance”.
For example, you have a credit card with a $1000 limit and the most you’ve ever charged on that card is $800. That $800 is reported to the credit bureaus.
- Since the $800 is the highest balance that has ever been on the card, it is considered your “high balance”.
- Your balance is essentially what you use on a daily basis and is typically your balance at the end of each month.
Another thing to understand when thinking about trying to increase the limits on your credit cards, is that the banks mimic what is on your credit report already. For example, say you have a $300 limit credit card, a $500 and a $1000 limit card. If you go to Navy Federal, Barclays, Citibank, etc. and apply for a new card, you’re probably won’t get approved for a $15,000 credit limit because they’ll look at your current highest credit limit on your credit report, and won’t want to over-leverage. Meaning, they’re not going to give you a $15,000 credit limit if your history reflects you’ve only been able to handle a $1,000 limit (at the most).
Now, on to what you can do to get higher credit cards limits:
Tip #1 For Getting a Higher Credit Limit
First and foremost, in building towards approval for higher credit limits, you need to be sure to use the most of the credit limits you do have. For example, if you have a $1000 credit limit, and that is your highest credit limit, use it to about 75 to 80% of the credit limit. This does not mean max out your credit cards. That would adversely affect you. It’s counterproductive to put a big balance on a credit card, and then let the balance sit, because then you will have high utilization. Remember, the magic number for utilization is 2%, and definitely below 5%. Therefore, you will ultimately pay the balance back down to the 2% of the limit amount before the statement closing date.
Here are a couple examples:
Card limit = $1,000
Amount you need to charge = $800 (the will be your balance)
2% of $1,000 = $20 (this is what you new balance should be after you make your payment)
Statement closing date = 15th of month
Payment amount before 15th of month = $780
New balance = $20
Summary: Charge $800 on your card, but make a $780 payment prior to the statement closing date
Card Limit = $3,000
Amount you need to charge = $2,800 (the will be your balance)
2% of $3,000 = $60 (this is what you new balance should be after you make your payment)
Statement closing date = 15th of month
Payment amount before 15th of month = $2,740
New balance = $60
Summary: Charge $2,800 on your card, but make a $2,740 prior to the statement closing date.
**This is key** If your balance stays at $800 (on a $1000 limit card) or $2800 (on a $3,000 limit card), your utilization will report at 80% and your score will drop significantly. Therefore, tip #1 is only for people who have the financial means to do this.
If you practice tip #1 consistently, the banks will say, “Okay, she/he has a $3000 credit limit. She/he had a high balance of $2,800; but, she/he was able to pay it down to 2% and the balance is now $60. Most importantly, she/he made her/his payment before the closing date.” Now, in the eyes of the lender, you are responsible and it looks very good. At this point, you can ask for an increase.
Tip #2 For How To Get a Higher Credit Limit
Let’s say you have credit cards with $300, $500 and $1000 limits. You apply for another credit card. Are they going to give you $15,000? No.
You can increase your high credit limit to $15k or $20k by adding one or two authorized accounts to your credit report. After that, when you go and apply for a new credit card, the computer system will see your high credit limit as the $15 or $20k, not just $1,000.
Therefore, if you are in the scenario described above, where your credit card limits are just $300, $500 and $1000, what you need to do is obtain one tradeline for $6,000 to $7,000, and another for around $15,000. This will show progression. Once these two authorized user accounts report to the bureaus and you then apply for a new credit card, the lender will see the high credit limit of $6,000 to $7,000, and even more, they will see the progression up to $15,000. Now, are you going to go backwards and get a $1,000 credit limit? Probably not. This doesn’t work for every bank, but it works for the majority of banks.
To get started on this, look at how your credit is structured from the lowest credit limit card, up to the highest. Write this down. Then, just step it up. Make sure you go up in credit limit for the next two tradelines you get. Get at least two tradelines, stepping it up and showing progression. This is called a progression file. Then, when you apply, you will get approved for higher limits, and these are called rise-user tradelines.
For more on authorized users, this topic is covered in our blog post called, “Raise Your Credit Score 50 Points in Less Than 5 Minutes”
Tip #3 For Getting Higher Credit Card Limits
Request a credit line increase, and give a really good reason.
Lenders need to see that you’re responsible and that you can make large, on-time payments. Typically, after you have made three consecutive payments, at day 91 most banks will give you a credit line increase. Most credit card companies will not give you an increase before day 91. Some of them will do day 61, but most banks won’t approve an increase until after at least 90 days of consecutive payments.
Banks will give you line increases and higher limits if you can show that you can make the payments that will keep your utilization around 2-5%. Remember, don’t pay it off completely. Leave 2% on. So, for example, if it’s a $3,000 credit limit, get it down to $60.
Secret tip: If you can make two payments in the same month, your chances of getting approved for a higher credit limit will increase by 60%.
Our credit guru, Mike, was able to get credit limits over $50,000 by having high-end tradelines and making payments twice a month. He had a $40,000 Chase tradeline, but when he applied for a Barclays card, they only approved him for $30,000. Following his own advice, Mike charged the card and then made three consecutive payments. He then went back to Barclays and said:
“I’m looking to remodel my kitchen and I need another $10,000. I need a little bit of an increase. I want to stick with your family. I love your card, I love the benefits and perks, I love to travel and love the cashback.”
You must know your credit card really well. When you call, emphasize that you want to stay with them forever, and that you just need a little increase to do something like, make kitchen upgrades.
The need to update something in your house, like the kitchen scenario, is the best type of reason you can give for needing credit limit increases. Why? Because it shows stability, and that you’re not just using it for partying, or a vacation, etc.
Tip 1*: Know your closing statement dates for all of your credit cards. Once you know those dates, almost max out your cards. Prior to the statement closing dates for each card, pay it down to 2% utilization.
Example: With a $1000 credit limit card, charge about $800 on it. Again, this is for financially stable people. If you are not able to make a $780 payment, then you have 80% utilization on your credit report and your score will go down.
*This is the best method for getting higher limit credit cards, but you should only attempt this scenario as long as you are financially stable.
Tip 2: Put two tradelines on your credit report with higher limits, stepping it up.
Example: You have a $300, $500 and $1000 limit card. You need to then obtain a $5,000 tradeline, then a $10,000 or $15,000 tradeline. Therefore, this will look like, over time, you’ve been approved for higher and higher limits.
Tip 3: After making consecutive and consistent large, on-time payments for at least 90 days, call the credit card company and request an increase saying:
“I’m redoing my kitchen, so I need an increase. I love your benefits and perks, so I want to stay with your family. I want to make sure I stay with you guys, and I am trying to upgrade my kitchen (flooring, granite counter tops, stainless steel, etc.), so I need about another $XX”
The three tips I just gave you are the game changers for getting credit line increases and to get higher credit limits.
Finally, do you need help getting authorized users?
In our program, we are able to help you obtain authorized user trade lines for up to 75% off competitive prices. Our Associates and Bachelors programs include this feature. Not only that, there are money-making tips also included in the program. The investment in the Associates or Bachelors program could be the difference between you getting another $1,000 credit limit or a $15,000 credit limit.
If you want the help and education, and you want to get up to 75% off tradelines, then pick up the phone and call. We’re here for you.
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