There are some good reasons that Minnesota consumers might have for wanting to request a higher credit card limit. Then again, there are also some really bad ones. Increasing your available credit could make it possible to purchase a needed item AND help your credit score. On the other hand, if requested for the wrong reasons, asking for a higher spending limit could hurt your credit score. It’s also important for your timing to be right. For example, if you’ve just missed a payment, it’s probably not a good time to ask for a limit increase. Credit cards can be valuable credit building tools for Minnesotans who manage their accounts responsibly. Knowing when to ask for more credit is an important part of your credit card management system.
Answering these Five Questions will Help Minnesota Consumers Determine whether or not they should ask for a Credit Card Limit Increase
Before any Minnesota consumer asks for a higher credit card limit, the following questions should be seriously considered. Then you will be able to make a wise decision that will give you the spending flexibility you need without harming your credit score.
1 – Why do you need a higher credit card limit?
Here’s a scenario that might lead a Minnesota credit card user to ask for a higher spending limit. Your income has just received a major boost and having more available credit would lower your credit utilization ratio and help your credit score. It’s also okay to ask for a higher credit card limit if you need to make some improvements to your home and intend to pay off the balance quickly. However, if you’re using credit to spend beyond your means, asking for a higher credit card limit is a bad idea. With more available credit, it’s likely that you’ll just get yourself further into debt and closer to defaulting on payments. This could lead to accounts going into debt collection and a severely damaged credit score.
2 – Have you been managing your credit card accounts and loan payments responsibly?
According to a recent poll conducted by CreditCards.com, 89% of those who ask for higher credit card limits get them. These are pretty good odds. However, that doesn’t mean you should call your credit card company without considering your payment behavior. If you’ve recently missed payments on any of your credit card accounts or loans, your request for more credit will probably be denied. Also, if your consistently maxing out your credit card, your issuer is less likely to bump up your spending limit.
3 – What is your credit score?
When consumers in Minnesota ask for higher credit card limits, they are essentially applying for additional loans. If you ask a credit card company for a bigger spending limit, you’re asking it to take on more risk. For this reason, the credit card issuer will check your credit score before making a decision. So, if your credit score is low, don’t be surprised if you’re turned down.
4 – Are your chances good enough to justify the hard pull on your credit report?
When you pull your own credit report(s), you’re performing what is called a “soft pull,” and this kind of inquiry won’t affect your credit score. However, an inquiry from a creditor or lender results in a “hard pull” on your credit report. Hard inquiries must be authorized by the consumer whose credit is being checked. And they do cause credit scores to temporarily drop by a few points. So, if you’re a Minnesota consumer who’s working to improve a low credit score, asking for a higher credit card limit may not be a good idea. Because of your low credit score, it’s unlikely that your request for more credit will be granted, and you’ll just end up losing credit score points for nothing.
5 – Can you realistically manage access to more available credit?
When it comes to credit, taking on more than you can handle is never a good idea. The basic rule of credit card use is that you should never charge more than you can afford to pay off. Therefore, if you’re a consumer who has a tendency to overspent, having access to more credit might be dangerous. Remember that there’s no shame in being honest about your limitations. If you suspect that a higher credit card limit would create more temptation to overspend, you should hold off.
Another Way for Minnesotans to Responsibly Manage Credit Cards and Improve their Credit Scores
All Minnesota credit card users should get into the habit of regularly checking their credit reports. This will help you spot fraudulent accounts opened in your name by identity thieves. Keeping tabs on your credit reports will also give you the opportunity to look for errors that might be bringing down your credit score.
If you do spot any errors on one or more of your credit reports, you should dispute these inaccuracies immediately. In order to do this, you’ll need to send dispute letters and supporting documents to the appropriate credit bureau(s). Luckily, Minnesota consumers with credit report issues can now get a FREE credit repair lawyer to help them through the entire process.
The Free and Legal way to Get Better Credit
Don’t let errors on your credit reports bring your credit score down. At Minnesota Credit Repair Lawyers, we’ve been cleaning up credit reports for consumers since 2008 for free. How do we do it? The law allows us to collect our fees and costs from the defendants in any successful action. This is why our clients pay nothing for the work we do.
Let’s start the conversation about what we can do for your credit. Set up your free consultation today by calling Attorney Gary Nitzkin at (888)293-2882 or sending him a message through our contact page.