It’s not uncommon for credit card companies to raise your credit limits; they do so to benefit you – or do they? The truth is that it depends on who you ask. Many people struggle to have their limit raised, while others have their limits raised automatically. There are a variety of reasons that some find their limits raised while others don’t. Let’s take a look at the criteria that fit both scenarios.
Why Your Limits Were Raised
If you are in good standing with the credit card companies you’re associated with then it is likely that they will periodically raise your credit limits. By why do they do it? Usually, in the letter you receive notifying you of this adjustment, you will be told that you have been rewarded for keeping your account in good standing. However, some feel that the real reason for raising accounts in regular intervals is to give you more money to spend – and more interest to pay each month that you carry a balance.
One way to prevent this from happening is to ask the company you work with to lower your interest rate. This way, if you do carry a balance, the interest charges won’t be as high. Also, you can request that credit card companies not raise your credit limits without your permission.
Why Your Limits Weren’t Raised
Now, if you’re the person who wants to raise your credit limits, then you may be wondering why your limits weren’t raised. Here are a few reasons that this may be the case:
- Your level of income. If you have a lower level of income, your limit may not be raised because it is assumed that you won’t be able to pay off the balance if you charge the full amount available to you.
- How you use your existing credit. If you use your existing credit irresponsibly (not paying on time, maintaining a high balance), you will not get a limit increase, and may even see it cut.
Credit card companies are usually eager to raise your credit limits if you’re a good customer, so if you’re really interested in having this adjustment made it’s good to contact your company to see how this can be done.