- 1 How to Apply for a Credit Card With a $10,000 Limit
- 2 Estimate your possible credit limit
- 3 Should I Lower My Credit Card Limits?
- 4 How do credit card limits work?
- 4.1 How is your credit limit worked out?
- 4.2 How to find your current card's credit limit
- 4.3 What happens if you go over your credit limit?
- 4.4 How to increase your credit limit
- 4.5 How to lower your credit limit
- 4.6 Can your provider change your limit?
- 4.7 Credit limits on balance transfers
How to Apply for a Credit Card With a $10,000 Limit
When you have a credit card with a $10,000 limit, you have a lot of buying power. If the credit card also offers additional benefits such as airline miles or bonuses, you can earn a lot of rewards by charging as many purchases as possible. Although your current credit card issuers might be willing to raise your limit, you might want to simply apply for a new high-limit card. It's a simple process as long as you are willing to do some research into the right cards and your own credit reports.
Choose a high-limit credit card that is likely to give you a $10,000 credit limit. Typically, you will need to apply for a Gold or Platinum Visa or MasterCard to get such a high limit. Besides a high limit, these cards might also offer cash-back rewards or airline miles, so look for one that offers the best additional benefits.
Request a copy of your credit report from Equifax, Experian and TransUnion. Under the law, they must give you a free copy once each year. You will need an excellent credit history to apply for a credit card with a $10,000 limit. You'll be able to determine whether it is good enough by reviewing your reports.
Dispute any negative information on your credit reports that appears to be incorrect. If the credit bureau cannot verify the accuracy of the negative information, it must take it off your report. This will improve your credit score and boost your chances of getting a credit card with a $10,000 limit when you apply for it.
Recheck your credit reports before applying for your high-limit credit card to make sure the negative information has been removed. This should be accomplished within 60 days.
Send in the application for your preferred high-limit credit card, or fill out an application on the Internet. An Internet application may give you an instant response instead of having to wait for a mailed application to be processed. However, when you're applying for a $10,000 limit, even an Internet application may not be approved for several days.
Estimate your possible credit limit
Credit card issuers set low credit limits for a variety of different reasons. The overall national economic outlook may be somewhat dismal, inspiring lenders to be conservative with the amount of credit they are willing to extend to cardholders. You may have a low credit score or a shaky credit history, causing your credit card company to have little confidence in your 'creditworthiness' as demonstrated by the low spending limit they choose to extend to you. Or perhaps your credit card company simply may not feel like it's necessary to increase the perks associated with your account - like boosting your limit - in order to keep you happy.
How to increase your credit limit?
If you are keen on having your credit limit increased on an existing credit card, there are a couple of ways to go about it.
If they disagree, ask them what you would need to do to earn an expansion in your spending ability. You can always apply for a new card with a higher credit line elsewhere if you don`t think that you are getting the fair treatment you deserve by your current credit issuing company.
You can also use other calculators
*See the credit card's terms and conditions on the online application page. Note that this website may be compensated by credit card issuers when the visitor applies for a card through the links on this website. We do our best to maintain all information accurate and up to date. However, we do not warrant the credit card information won't change. Click the "Apply Online" button and review the current info on the secure credit card terms page.
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Disclaimer: This editorial content is not provided or commissioned by the credit card issuer(s). Opinions expressed here are the author's alone, not those of the credit card issuer(s), and have not been reviewed, approved or otherwise endorsed by the credit card issuer(s). Reasonable efforts are made to present accurate info, however all info is presented without warranty. Consult a card's issuing bank about the terms & conditions.
Common Sense for College by Frugal Dad
Should I Lower My Credit Card Limits?
Emily writes in the following question regarding credit card limits:
“I would like to lower the limits on two of my credit cards from $6,000 to $1,500, and $7,200 to $3,500, but IвЂ™m not sure what the repercussions would be.”
“My FICO score, according to my credit union, is currently 762.”
“I read your blog several times per week.В I am happy to report that after many years of struggling, my total debt is less than $10,000 ($8,400 in student loans and $1,475 on a personal loan at my credit union).В IвЂ™m on track to be debt free in a little over a year!”
Thanks for being a loyal reader, Emily. Congratulations on your progress – you are on the homestretch now, and will soon enjoy the freedoms of being without debt.
Lowering your credit limit seems to be the responsible thing to do. After all, you are eliminating risk for the card issuer by reducing the amount of potential liability they are exposed to, and you are reducing the potential for you going on a wild spending spree and adding thousands to your debt.
Keep Credit Utilization at 30% or Lower
Unfortunately, the credit scoring gods don’t quite see it that way. One of the major components of your credit score is referred to as “credit utilization.” That is, the percentage of debt you owe in relation to your credit limit.
As an example, if you owed $3,000 on a credit card with a $10,000 limit your credit utilization would be 30%, which most agree is the sweet spot, or at least the upper end of the utilization ratio. Anything higher and it actually drags down your credit score.
If you reduced that $10,000 credit limit to $5,000, but still owed $3,000, your credit utilization would double to 60%. Maintain this level for too long and your FICO score could decline.
If you are concerned with maintaining a good credit score, and 762 is a certainly a good score, it might make sense to wait until you have paid off your balances entirely to reduce your credit limits, or to close a particular credit card account. At that time, consider how much you may be spending on the card each month and ask for a limit roughly 3.5 times that amount (round up to the nearest $500 just to be safe).
Assuming you plan to spend about $500 a month on items you purchase with a credit card (utilities, gas, etc) ask for a limit around $2,000 to ensure you stay under the 30% utilization threshold. If your billing statement cycles and a higher utilization ratio is reported to the credit bureaus, you could see a drop in your credit score, even if you pay off the card’s balance each month.
Having said all that, a good FICO score is most important only if you plan to borrow again. Sure, credit scores are sometimes used to make employment decisions, and insurers often use credit scores to make underwriting decisions or to set premiums. However, it’s my opinion that we have become way too dependent on credit scores these days.
Make credit decisions that work best for your financial household, not because FICO suggests doing it one way or another. In the long run, you’ll be better off for it.
Thanks again for being a reader, Emily. Best of luck knocking out that remaining debt. Write back and let us know when you are officially debt free.
Ask the readers: Have anything to add for Emily? Have you considered asking issuers to lower your credit limit, despite the impact on your FICO score? Feel free to share in the comments below.
Jason had the foresight to understand that people canвЂ™t continue to live beyond their means without unpleasant financial consequences. JasonвЂ™s wisdom became apparent several months after the site launched, when the world economy saw its worst downturn in a century.
I’d only want my FICO high to get a good rate on a 15 year home mortgage. After that, I don’t see much point in even caring about a FICO score. We can save for a child’s education over time and buy a used with cash. What else would we really need a big loan for besides a home purchase? Some
landlords do some shady stuff with FICO scores, like run the credit of everyone applying for an apartment, and picking the one with the highest score. I find this discriminatory (not sure if its illegal) and wastes the money of all apartment seekers. So, perhaps having a good score in this instance may give you an edge, but I personally would not want to give my money to a landlord that behaves like this.
For the scores above 760, the credit “gods” want to see a credit utilization of 10% or less. Going from 10-30% won’t drop you below 760 but will keep you from going higher.
We just found out our LOC and CC limits were upped. Significantly. It’s scary to think about what would happen should it fall in the wrong hands! Eeek!
First, Love the new site design. Great job. Way better than before.
Second, Bank of America lowered mine automatically, because I was never going over 1000 dollars. I was pretty upset, because I knew my credit score would take a hit because of this.
Every time they try to UP my limit, I call the credit card company to reverse it back to the original amount. I don’t want to be liable for for than I am comfortable with — ever! Me and my husband both pay the cards off in full every month (we have one each of the 2 major cards and they both offer rewards), if the purchase is a big one (like a mattress for example) we pay that card off with our much lower interest line of credit and attack it aggressively. My score is presently over almost 800 and my husband’s a little higher! I think the high score is because we actually do use credit frequently as an obsessively managed tool to take advantage of timely opportunities, but also pay it off reliably.
By keeping a low available balance I can sleep better at night (especially if I just gave my card number over the internet!)
I have lowered my credit limit before. However, the latest thinking is that it never helps and sometimes hurts your credit score/history. For those worried about being “liable” – federal law limits your liability to $50 for unauthorized charges. Since your credit limits are surely higher than $50, it doesn’t matter if the limit is $500, $5000, or $50000 – your liability doesn’t change. If the person you are worried about “attacking” your higher limit is yourself; well, then you’d have trouble staying under the 30% utilization anyways. There really is no reason to lower your limit and there is at least one reason to leave it high.
Sorry, I think this problem may be more yours than the bank’s. It seems that you want to lower your limit to prevent yourself from overspending. That is a recipe for disaster. If you can’t trust yourself, how are you going to stay debt-free in the face of any future crisis? So much of managing your finances is mental control. This is just another aspect of FI you want to master.
In my life, I have requested lower limits (when the numbers became ridiculously high-as in a year’s salary high) and had the bank lower my limit due to lack of activity. Neither mattered much in the long run. It’s like worrying about your interest rate on a credit card. As long as you know your due date, pay it off each month and have a fully-stocked emergency fund, who cares what the number is? It’s only imaginary. Just like your credit limit. Here’s an idea: just PRETEND the bank has lowered your limit. Then go out and live a happy, balanced, fulfilled life.
Great Dianes must think alike. I was pondering posting a similar thing…
I have ridiculously high credit limits. I don’t get anywhere close to using them, even when I travel for work a lot and they get intensive use. I can no more imagine having a spending binge because I have a high limit than I can taking off all my clothes and walking naked down the median strip of a throughway. The credit limit is irrelevant to me. I see no point in lowering it. I have no liability from it being high, and in truth I don’t care what it is.
Question, Chase turned me down for a card, said I had too many lines.
I cancelled one (with them)just before applying and have 2 remaining with them (about 2,000 limit(s).
Will lowering lines on 2-3 other cards (5,000 plus limits)with different banks help me get the Chase Card. Two free Flights are at stake. рџ™‚
I did not realized your score could decline by lowering your credit limit. I wanted to lower my credit card limit myself mainly because I never would reach $10000 max and thought of lowering it to $5000. But after reading this post, I will keep my $10000 limit. Thanks.
it makes sense in a way… the credit score is trying to measure self control. Still, do what you believe best for yourself. If you truly want the lower limit, go ahead and get it lowered, it is better to not have the worry about it then a perfect credit score.
So…a few years ago I transferred a balance from a private student loan that had a variable rate (which at one point was up to 13.5%!!) to a credit card that had a fixed rate of 3.99% for the life of the balance. The original balance (and credit limit) was $21,500. I will pay off the balance this month. I have never used the card for purchases and do not plan to. Would it be best to keep the card open with a 21000 limit and never use it for anything, have the limit lowered, or simply close the account. My only interest in this is maintaining my FICO score for future mortgage loans.
I also have another card with a $10000 that I haven’t used in 2 years. I no longer use any credit cards, ever. I have savings for “emergencies”.
My mother is in her late 80’s and I manage her finances. She has an excellent FICO score, though will likely never need to borrow money again in her lifetime. She has a single credit card which she uses for most of her monthly expenses, and I pay it off in full each month. Her spending limit is $14,000. My brother thinks I should lower this (“in case someone accesses her credit and goes on a spending spree”). Is there any value in lowering the spending limit to $5000 or so, or should I leave as-is? I don’t believe she’s liable for fraudulent charges made to her card. Any input will be appreciated.
How do credit card limits work?
Once you have applied for a credit card, your provider will tell you its credit limit.
Your credit limit is the maximum amount you are allowed to owe on your card at any given time.
For example, if your credit limit is Ј1,500 and you have an outstanding balance of Ј1,000 on your card, you will only be allowed to spend up to a further Ј500 until you reach your limit.
If you go over your limit you will usually be charged a fee and may not be able to spend again until you pay off part of your balance.
Most providers will still let a transaction go through, even if it means you will exceed your credit limit.
For example, if your credit limit is Ј1,500, you already owed Ј1,450 and you then spent Ј60, you would then have a balance of Ј1,510, which would be Ј10 over your credit limit.
What is the highest credit card limit you can get?
You will only find out the maximum credit card limit a provider will give you after you have applied.
Your provider will let you know the amount when they confirm your application has been accepted.
Providers state an "assumed credit limit" when they advertise their cards. There is no guarantee that they will offer you this amount - it is just used to help illustrate how much the card could cost.
How is your credit limit worked out?
Providers decide on how much to lend to you by assessing your application form and credit history. They will look at:
How much you earn and how much of this you have available to spend each month after your bills are paid
Any outstanding debts you have, like a mortgage, overdraft, loan or other credit cards. They will consider what percentage of your income these debts take up.
If you have never borrowed before, the provider will not know how well you can manage credit.
If you have borrowed before, they will look at your repayment history to see if you have a clean record or any missed payments.
If you have been their customer before, they will look at how you used your previous accounts.
What other credit is available to you, such as an unused overdraft or a credit limit on another card.
Your credit limit could be lower than expected if the lender sees you as a risk or unprofitable for them, if you have never taken out credit before or simply because providers are more cautious.
How to find your current card's credit limit
You can check the credit limit on your card by:
Signing into your account online or through its mobile app
Asking your card provider over the phone, email or post
Looking at any recent paperwork you have received
What happens if you go over your credit limit?
If you spend more than your credit limit, you will be charged a fee that will appear on your next credit card statement. This charge is usually Ј12.
Your provider could also choose to lower your credit limit and increase your interest rate, even if you have a low promotional APR such as a 0% deal on purchases or balance transfers.
It will also leave a black mark on your credit history, which could put off lenders when you apply for credit in the future or even cause your interest rate to go up on other cards you hold.
If you frequently go over your limit, your provider could even choose to close your account, and you will need to repay the debt within a short period of time.
What should you do if you go over your limit?
Contact your provider, offer to make a payment to bring your balance below the limit, then ask if they will waive the fee or agree not to report it on your credit record.
Your provider may even agree to increase your credit limit if you have held the card for several months and kept up with repayments.
Most providers allow a transaction to go through that will take you over your credit limit but then decline any further purchases unless you contact them and they agree to extend your credit limit.
How to avoid going over your credit limit
It is your responsibility not to exceed your limit, so make sure you know the limit for each of your cards. You can then keep an eye on your balance by checking it online, through an app, checking at a cash machine or asking your provider.
Most providers also let you set up an email or text message alert that will let you know when you are close to your credit limit.
How to increase your credit limit
You can ask your provider to increase your credit limit. Many providers will only review your limit after you have held the card for three to six months. You can do this:
Through your online account or mobile app
Your card provider will decide based on your credit history, income, other borrowing, other available credit and your repayment history with their card.
You can help the chances of your provider agreeing if you improve your credit history; this guide explains how.
However, having a higher credit limit means you will have to be careful to avoid spending beyond your means.
Some providers offer "no limit" credit cards to customers with a high income and spotless credit history.
How to lower your credit limit
You can ask to decrease your credit limit if you want to remove the temptation of overspending. It can also help if you want to apply for credit with another provider and think the level of credit you currently have available is too high.
Decide on the new credit limit you would like, but make sure it will be enough to cover your spending on the card. You can then contact your provider to ask them to reduce your limit to this amount.
Can your provider change your limit?
Yes, your card issuer can change your credit limit without asking you.
They could decrease your limit if:
You exceed your credit limit
You miss a minimum repayment
Your credit history has been negatively affected by your handling of other cards or loans
You have used the card irregularly
Your provider could also increase your limit if they feel you would be able to handle the repayments or if you are often close to going over your limit.
Credit limits on balance transfers
If you take out a credit card to make a balance transfer, the maximum amount you can move over to your new card is set by the credit limit you are given.
If you were given a credit limit of Ј3,000 and your new card issuer let you use up to 90% of it towards a balance transfer, you could make a balance transfer of up to Ј2,700.
Even if you wanted to transfer an existing balance of Ј3,500 but the new card would only accept up to Ј2,700, you could move most of the balance across and potentially save hundreds in interest.
You could then leave the remaining Ј800 on your old card and repay it there.
Written by Dan, Financial Content Writer
Updated on 2nd March 2018
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