How are credit card limits determined?

Credit Card Q&A

Question

How are credit card limits determined?

Answer

Underwriting, which is the technical term for both the approval and the credit limit of a credit card application, can vary for different credit card companies. A company's underwriting criteria is often a closely guarded secret since it can determine how profitable any given company can be.

From past experience, we can share that the two major factors in determining one's credit card limit are credit score and income. A credit score will determine the credit risk of any given applicant. The income will determine the ability of that applicant to pay back the loan. As mentioned before, no company will give their model but generally speaking the higher your credit score and your income, the higher your credit limit.

We posted a blog about credit card limits if you are interested in learning more.

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USER COMMENTS(3)

eddiegorniak
Nov 13
8:46 am

I have a Juniper card with a 5k limit, a personal Chase card with a 2k limit and a business Chase card with a 5k limit. My income the past few years is more the double what it was when I first opened these cards. Can I contact these companies and send a statement from say oct of 2009 and get my limits raised to 5k & 10k? Currently making over 100k.

Thanks.

CK Moderator

The first thing to do is simply call customer service and request a credit line increase. Keep in mind some credit card companies will run another hard inquiry as part of the process. It is during this process that some credit card companies will request proof of income to increase the credit limit.

bprice
Jul 11
12:45 am

It would be awesome if this site offered a credit line simulator, similar to the credit score simulator but applied to determining how much of a credit line or loan amount one could generally expect based off different inputs such as credit score, income, payment history, etc.

CK Moderator

Thanks for the recommendation. We have something in the works.

kyrabeatty
Feb 17
8:38 am

I would say that your current income is not taken into consideration, though. I have had many instances where I was told by reps that they could not update my income. So they're still using my income from when I applied back in 2000 when I was a student.