Reasons for Denials of an Increase in Your Credit Limit

There are times in which you will want, or need an increase in your credit limit, but there are many reasons why that may be denied. Some reasons you may want or need an increase is if you are planning a big trip, and you want enough cushion in the card to cover any unexpected charges and expenses. Or you have a big purchase that you have to make, such as an emergency, like a new roof on your house or a major car repair.

Factors to Consider in Denials.

  • You have been late
  • You have to many open accounts
  • Your credit score is to low
  • You have major delinquencies on other accounts

Besides the important ones mentioned above, and discussed in detail below. There are other reasons that your request is denied, such as you have sought to many new accounts in to short a period of time, or your income has decreased and you cannot justify the increase in your credit limit, your monthly payments have been to low, or only the minimum. Another less obvious one is that you have many open cards with to much available credit, this could indicate that you are having a financial set back.

increase in your credit limit

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1. You have been late

This may seem obvious, but lets talk about it, if you continue to show a pattern of late payments, not only on the card you are seeking an increase on, but on any other accounts that you have open, remember, the first place the company will check is your credit report, and the open accounts and their history, if there is a pattern of late payments, this will be the reason for your denial. One thing that most overlook is the importance of making payments by their due date, each and every month, regardless. The occasional late payment should not be the death nil, but a long term pattern will insure your denial.

2. You have to many open accounts

In the last couple of years you have applied and received new credit, or not received new credit, may be a big reason you are not getting a requested increase in an existing account. All these new account inquires will have a detrimental effect on your credit score and will be a causing factor in your denial of increase in your current credit limit. When applying for a credit card, ask them to do a soft pull, which may be a way to avoid the hit on your credit score. Not all companies will do this for you though, and you have to ask.

3. You credit score is to low

You may be denied for the basic reason that your score is just to low. You should explore options to increase your score, such as paying off debt that you can, consolidation, so that you do not have to many open account, and to many payments, which can lead to missed payments and late payments that can really impact your credit score, and keep it from increasing. Or you may want to consider a more permanent solution, and file bankruptcy, get a fresh start, and begin anew.

4. You have major delinquencies on other accounts

For example, if you have major late payments on a house, or car, or deficient balances on old cars that were repossessed, or homes that were foreclosed on, you can essentially guarantee that you will not get that increase requested. You should pull your credit report, once every year, but once before your request, to be sure all things are in order before you pick up that phone and ask for that increase in your credit limit, knowing first, will avoid the embarrassment and, will give you a chance to fix what may be lacking in your overall report.

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In sum, there are many small factors, and a few big ones that will effect your outcome on your request for an increase in your credit limit. Your card may be to new, to warrant an increase regardless of how good your credit is otherwise, or there was a recent increase already. Or your income is just to low. But the big ones mentioned above will have the greatest impact. You have to many late payments and a late history on all of your accounts. You have to many open accounts, with to much credit already available to you, or you credit score is just to low to justify the increase and lastly there may be some major delinquencies that need to be addressed and taken care of in some other means in order for your credit report and score to grow in step. Finding, and addressing these issues is of utmost importance and should be done before you make any applications for an increase in your credit limit.