Controlling Credit Limits and Credit Scores

[ForumReader]

Got a question regarding rebuilding my credit. If a creditor (CAP 1) raises my credit limit by $250 and I contact them back to reduce $250 back to my original CL, will it affect my credit score? Does anybody know? Thanks.

[HHM]

In such a narrow range, probably not.

Why do you care if Cap 1 increases the limit from $250 to $500. That increase will probably help your score (although very minor). Reason being, the increase in credit limit decreases your debt to open balance ration. For example, if you routinely run a $75 balance on that card...

At $250, that ratio is 30%
At $500 that ratio is 15%.

Also, its not enough of an increase to have a negative impact as far as having too much available credit.

I'd leave it alone.

[justbroke]

I concur. I'd leave it alone. Having available credit helps your score. A little known fact is that having high credit limits, also helps your score. Creditors like to see that you can handle "high" lines of credit and the FICO score incorporates this.

Are you just afraid that you'd use the credit?

[ForumReader]

Thanks. Just wondering. By the way, my CL is $500 and I do not want to end up having a higher limit if CAP 1 continues to increase my CL. So I wanted to know if it would hurt my credit score if I requested CAP 1 to keep the whatever amount CL I am comfortable at. In this case, I guess I will just leave it alone.

[ForumReader]

I concur. I'd leave it alone. Having available credit helps your score. A little known fact is that having high credit limits, also helps your score. Creditors like to see that you can handle "high" lines of credit and the FICO score incorporates this.

Are you just afraid that you'd use the credit?

No I am not afraid of high credit limits, but it takes great perseverance and control not to run up a credit limit. Having a "watch dog buddy" helps keep my finances in check

[HHM]

We are probably talking about single digit point moves at this level.

If they raised your limit, and then you have it reduced, that may drop the score.

[ForumReader]

We are probably talking about single digit point moves at this level.

If they raised your limit, and then you have it reduced, that may drop the score.

In this case, as mentioned earlier, I will leave it alone.