How to request an increase on your credit limit to improve your credit score
- You can increase the credit limit on your credit card by submitting a request to your bank, either online or by phone.
- No matter how or where you apply for a credit limit increase, you'll need to provide your employment status, annual gross income, and monthly housing payment.
- Most banks will perform a hard inquiry on your credit report before granting a credit limit increase so they can consider your payment history and other important credit factors.
- Approval processes vary by bank, but you may have access to a larger credit line within minutes of requesting an increase.
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I have three personal credit cards, and for now, I'm happy with that. I can track my spending easily and pay off the full balance on each card every month - one of the most important factors helping to keep my credit score in good standing.
But when I recently added my partner as an authorized user on one of my credit cards, I decided to request a credit limit increase, knowing that our combined spending would push the monthly balance closer to the card's limit.
My credit utilization ratio (how much of my available total credit I use each month) is in good shape, and I didn't want to jeopardize that. Credit utilization has a significant impact on your credit score, and ideally should stay below 10%, meaning you carry less than $1,000 in debt for each $10,000 in available credit you have.
I figured my bank would ask me a bunch of questions and take a few days to process my request for a credit limit increase. I even spent time crunching the numbers and thinking about how much I would ask for.
Turns out, it took less than five minutes over the phone to ask and get approved, and I didn't even have to make a pitch. It was shockingly easy. The process of requesting a credit limit increase varies by bank, but here's how it usually works:
How to increase your credit limit
1. Check your credit score
First and foremost, check your credit score. You can do this for free, any time, on sites like Credit Karma, Credit Sesame, and Credit.com.
Banks look at payment history and credit utilization when determining a person's credit limit - they'll be more favorable toward someone who doesn't get too close to their total credit limit across all cards and pays their balance in full. If these factors are not in good standing, your likelihood of getting approved for more credit is low.
2. Wait for an automatic increase
If you've been making on-time payments and frequently swipe your card, your bank may increase your credit limit periodically. Usually they'll ask for your approval before giving you a larger line of credit. Since the increase wasn't requested, it won't require a hard inquiry on your credit report (they've already determined that you're a responsible borrower).
3. Consider applying for a new credit card
If you're debt-free and able to manage multiple credit cards, consider opening a new card and taking advantage of a stellar introductory bonus. Be aware: This will require a hard inquiry on your credit report. A hard inquiry will temporarily ding your score by a few points, but it should recover quickly.
4. Decide how much you want to ask for
If you're responsible with your credit cards and are requesting more credit to keep your credit utilization in check, you may start off by asking for $5,000 to $10,000 more than your current credit limit. If the bank denies the request, you may be able to make a counter offer.
Depending on the bank, you may not even have the opportunity to request a specific amount. The bank may just review your income and payment history and decide what's appropriate.
5. See if your bank takes requests online
Some banks will allow you to fill out a request for a credit limit increase through your online account. The easiest way to find this is through the site's search bar. If the bank doesn't offer the application online, you'll be prompted to call.
Keep in mind that some banks won't grant a credit limit increase unless you've been an account holder for more than six months.
6. Call the number on the back of your card
If you can't apply for a credit limit increase online - or you prefer talking over typing - call the number on the back of your card. Click through the automated directory until you're transferred to a customer service representative.
7. Verify your identity
Minimally, the bank will ask for your name and the answer to one (or all) of your security questions in order to verify your identity. They may also ask for your address and Social Security number.
8. Agree to a hard inquiry on your credit report
After you tell the customer service rep you want to apply for a larger credit line, they will usually ask you to agree to a hard inquiry on your credit report.
While a hard inquiry does ding your credit score, it's a relatively small impact outweighed by the improvement in your credit utilization. Some banks will only do a soft inquiry at first, which doesn't ding your credit score, but they should let you know before performing any type of inquiry.
9. Have your income and monthly housing payment ready
No matter how or where you apply for a credit limit increase, be prepared to provide the following:
- Employment status
- Annual gross income (of only the primary cardholder)
- Monthly housing payment
In my case, the customer service person I spoke with did not verify this information (to my knowledge). She didn't ask any follow up questions or put me on hold to check for accuracy.
10. Wait for approval
If you apply online, you may have to wait days to hear back from the bank via snail mail. A phone call will often yield a faster response, but not always. The customer service rep may say the bank needs more time to process the request and will be in touch.
I was approved within seconds of providing my income and monthly housing payment. In fact, I was still speaking and the customer service rep interrupted me to say "congratulations!" and told me I was approved for a nearly $6,000 increase. She didn't give me any reasoning behind this seemingly arbitrary number.
Within minutes, my account reflected my new credit line and by the next day, a formal letter was waiting in my inbox.
Related coverage from How to Do Everything: Money :
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Why you should not cancel a credit card
How to check your credit score for free
How to increase your credit score