I have an Old Navy card that use to have a limit of $400, they raised it to $750 does that have a negative impact on my credit and my credit score or does it look good? Also what affect will it have if I ask them to lower it again, or close the account out completely?
I am trying to work on my credit score to get a good interest rate on a home loan, any advice will be very appreciated!
Thank You!
Tracy
2006-08-23 15:12:06 · 13 answers · asked by Tracy M 2 in Business & Finance ➔ Credit
here's some great reading, might take you a while though:
http://credit-cards.ebookorama.com
http://finance.ebookorama.com
http://credit.ebookorama.com
http://credit-repair.ebookorama.com
if you get any luck please don't forget about me lol, hope it helped you!
2006-08-23 15:16:09 · answer #1 · answered by Anonymous · 0⤊ 1⤋
The increase is not enough to even show up on their radar screens. Leave it alone, don't close the account. If you continue to use the card and pay the bills on time, that's the best thing you can do.
Other times getting a credit limit increase can hurt you. Creditors look at how much available credit you have, and see that as potential debt. So lets say you were looking for that mortage, and you had a $40,000 credit limit on several cards. That makes the lendor nervous. But your tiny $750 limit won't even be looked at. Just your payment history.
2006-08-24 13:30:42 · answer #2 · answered by Anonymous · 0⤊ 0⤋
It all has to do with what percentage of your limit you have spent.
The rule of thumb is to not spend more than a third of the money available to you. This demonstrates to a creditor that you are fiscally responsible.
So if you had $200 on the card you were over the one third ratio when your card had a $400 limit because one third of 400 is about 133. However, now that your card is at a $700 limit, you should try and never spend more than $233. So in that case, your score would have gone up if you had $200 on it because now you would be below the one third margin.
2006-08-23 23:50:05 · answer #3 · answered by Think.for.your.self 7 · 0⤊ 0⤋
Do not ask to lower the amount. They trusted you because of your outstanding record so they extended more credit your way. As long as you do not charge to much so that if you apply for another loan that the bank will not look down at what you owe other creditors. The banks will be up front if you have too much credit - meaning you owing to many creditors if they will extend you a loan or not. If you are charging or owing too many creditors to a bank you would be a risk. Have more going out than coming in. But having your limits raised does not hurt you, it helps you in more ways than one.
2006-08-24 01:32:53 · answer #4 · answered by jewels_of_fire76 2 · 0⤊ 0⤋
jodi is correct.
It will help your scores as long as you leave it open and do not ask for a credit limit decrease.
You might check out the forum I've listed. Do some reading in the newbie forum first, then do some reading in the credit and mortgage forums. There are a lot of good threads on raising credit scores.
It is a free to use - no spam site.
2006-08-23 23:35:30 · answer #5 · answered by echo 7 · 0⤊ 0⤋
Most likely, it is a good thing. It means that they are trusting you with a higher limit because you are making your payments on time. It will look good on your credit score.
However, if you ask them to close the account completely, it will have a negative impact on your credit score. I've checked people's credit reports, and, if they do close an account, it reflects poorly on their report. It shows that they are incapable of making payments to that account, so they had to resort to closing it.
Have someone (ie a realtor or mortgage company) check your credit report.All they require is your social, your full name, and your current address. Hope that helps!
2006-08-23 22:21:12 · answer #6 · answered by Jacque 2 · 0⤊ 0⤋
No this is a good thing really, just leave it alone it letting the credit bureaus know that people trust you. Also, raising your limits helps your debt ratio and that is one of the main things they base our credit score on .
Do not cancel or ask them to lower, canceling does not look good to them. You can investigate on here if you don't believe me meaning the internet. That is the last thing you want to do.
:)
Both of my goofy sisters older and younger did it without talking to me or my mother, olders score went from 805 to 777 and younger who mind you is only 22 went from 730 to 700.
By the way if you are looking to help your credit score look into Piggybacking or Riding on Shirttail. This is when someone like a family member that you know has very good credit and has for years adds you on one of the older accounts as a authorized user and it goes to your credit and helps you. Look into it really works how do you think younger sister had a 730 at the age of 22.
:)
2006-08-23 22:20:54 · answer #7 · answered by jodi_lynn_124 2 · 1⤊ 1⤋
someone said to me one time that a credit card
should be charged to about half of the limit on the card.You have credit available but not the whole amount.....Dont know for sure but it sounds right.....It is difficult to win in the credit game....seems like we always loose
2006-08-23 22:18:53 · answer #8 · answered by music man 2 · 0⤊ 0⤋
Well, it could be bad in that they'll see that you have that much more of a credit line. I hate when credit card compaines do that without asking you. If you keep the card, just be careful with it. If it were me, I'd ask that they lower it and not raise it again without your consent.
2006-08-23 22:19:35 · answer #9 · answered by First Lady 7 · 0⤊ 1⤋
Do not ask to lower the limits
2006-08-24 06:57:33 · answer #10 · answered by Anonymous · 0⤊ 0⤋
as far as you are paying your credit card this is good to youbut you have to check with the credit compagny to known what is it on your file. Equifax.com may help you
JP
2006-08-23 22:16:44 · answer #11 · answered by JP 3 · 0⤊ 0⤋