GodAtum 0 Posted April 3, 2012 Share Posted April 3, 2012 Will increasing my credit card limit affect my credit score? Link to comment Share on other sites More sharing options...
Pablo Montoya 64 Posted April 3, 2012 Share Posted April 3, 2012 Shouldn't do. If you are good at playing the monthly bills and aren't late with the payments then it should either stay the same or improve slighly. Phone your bank to be sure though! Link to comment Share on other sites More sharing options...
RWiltsF 21 Posted April 3, 2012 Share Posted April 3, 2012 Pablo's got it pretty spot on; if you are allowed an increase it shows you've got good credit history anyway. If you pay it back you'll be increasing your credit score if anything by proving that you can borrow and repay on time, which is effectively what credit scoring is all about (and will also be affected by things like multiple changes of address, so students for example sometimes have bad credit history due to moving a lot and probably not being on the electoral role) Link to comment Share on other sites More sharing options...
GodAtum 0 Posted April 3, 2012 Author Share Posted April 3, 2012 What's a bit odd is that online there is a page which allows me to increase it but does no specify a maximum value. So do I start high and go lower until it accepts my value lol? Link to comment Share on other sites More sharing options...
Merlin820 32 Posted April 3, 2012 Share Posted April 3, 2012 (edited) What's a bit odd is that online there is a page which allows me to increase it but does no specify a maximum value. So do I start high and go lower until it accepts my value lol? Normally there will be a credit limit set for you by the company. If you are below that, you can increase until you reach that limit without submitting any new application or supporting documentation. Anything over and above the set credit limit will have to be a new application and subject to credit checks etc which should be nothing to worry about if your file is in good order. Edited April 3, 2012 by Merlin820 Link to comment Share on other sites More sharing options...
andi + 1,262 Posted April 3, 2012 Share Posted April 3, 2012 There's not really such thing as a credit score, you have a credit history that can be checked, but there's no magic number. One thing that is checked is how much available credit you have, and companies do compare it to how much you earn before deciding to lend you more. I wouldn't be taking out extra credit unless you need it really. Link to comment Share on other sites More sharing options...
Marricked 0 Posted April 3, 2012 Share Posted April 3, 2012 Getting credit limit increases declined does effect your credit score so make it a realistic figure. 1 Link to comment Share on other sites More sharing options...
GodAtum 0 Posted April 3, 2012 Author Share Posted April 3, 2012 Whats a realistic figure? My current limit is £3700, would a realistic figure be £4000 or £5000? Link to comment Share on other sites More sharing options...
GoneForgotten 2,494 Posted April 3, 2012 Share Posted April 3, 2012 (edited) Credit "scoring" is a value add service provided by credit history and identity agency like Equifax and Experian. The rates and amount you can borrow is subject to assessing you as a credit risk. There are a number of risk factors that affect you. One of those things is certainty about who you are, hence being on the electoral roll, how long you have been there demonstrates stability, people without upheaval in their lives pay their debt. Who you are financially associated has an effect, so people also living at your address affect your situation, even if they have nothing to do with your financial affairs (bad debtors who don't pay their fair share of the bills or partners who spend recklessly). Then there are county court judgements, bankruptcy, default and failed directorships. Then a significant component is how much you've borrowed and how much you pay back. Unlike what others have said to you, how much you borrow does have an effect, because just like insurance data, alot goes back to the actuarial information about how similar people, in similar circumstances default, or don't. If other entities are willing to lend you money then there is an aggregate sense that you are credit worthy. It's self reenforcing. The riskier you are the more money has to be set aside by the banks to cover your potential for default (PD, likelyhood measured between 0 and 1) times by the loss given default (LGD), the loss given default in turn is worked out by taking how much you've borrowed and a guess at how many pence in the pound they stand to get back from your assets, which is why the risk profiles of secured (on a house or car) vs unsecured (just on what they could get from you on the day they sue you) are very different. The more they need to set aside, the more money sits idle, which they can't invest, and in turn make money on, so the more interest you are charged. Your credit score make it easier for organisations to not get into all the risk factors and just say, over 400 is "good" for whatever value of good they want. Credit bureau simplify this further by saying this is what we consider our numbers mean. So, borrowing more money can help, because if you are able to borrow more and pay it back it demonstrates you can afford to borrow more money, so if you have a limit of £5000, borrow into that regularly and pay it all back you wind up with better credit scoring than someone who borrows £1000 and pays it all back. Ask me how I know Edited April 3, 2012 by WhatAmIDoing 2 Link to comment Share on other sites More sharing options...
GodAtum 0 Posted April 3, 2012 Author Share Posted April 3, 2012 Thanks for the detailed explanation :new_doh2: i'm not looking to borrow more, just that it would be nice to have for emergencies or for travel. Link to comment Share on other sites More sharing options...
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