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Does having a higher credit limit work better than keeping a lower limit in place?
Asked by
AppleRules
1 year ago
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Like everything else, it depends on the limits and context. Generally speaking, you want to have access to high credit and low debt. When it comes to access to credit, higher is better than lower within reason. Having $25,000-$100,000 in available credit is probably reasonable. Having $500,000 in credit card is probably excessive and could make other lenders think you are a risk because you have access to too much credit. The answer for debt is simpler. Lower debt is better. You always want to have a lower balance.
Because there are over 200 attributes that go into computing your credit score, general answers are very difficult.
SpookyCookie 2 months ago
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Thank you for this answer. I have several cards with high limits and low utilization, and have often wondered what "excessive available credit" means. Your guideline of <=$100K puts my mind at ease, thanks!
manetco 1 year ago
Like everything else, it depends on the limits and context. Generally speaking, you want to have access to high credit and low debt. When it comes to access to credit, higher is better than lower within reason. Having $25,000-$100,000 in available credit is probably reasonable. Having $500,000 in credit card is probably excessive and could make other lenders think you are a risk because you have access to too much credit. The answer for debt is simpler. Lower debt is better. You always want to have a lower balance.
Because there are over 200 attributes that go into computing your credit score, general answers are very difficult.
SpookyCookie 2 months ago