Do all credit card companies have a set credit limit for balance transfers?

Question

I applied to Barclaycard online to transfer several balances totalling £4,000, filled in all my details including how much I could pay each month (these are for 0% balance transfers for 12 months) and I get a letter with the new card saying they have set the credit limit to £950.

So I can't transfer the £4,000 over - they said they can increase the credit limit after 3 months but its not guaranteed!

My question is, before I start looking for another card that will accommodate my needs, do all card companies set a specific limit?

Thanks

Answer 1

Yes, every credit card comes with a credit limit.

The ideal way of using a credit card is to pay off the entire balance in full each month. Otherwise, you just end up going further and further into debt. Get a card that has a limit around what you expect to be paying each month.

Answer 2

No. Balance transfers are usually a promotion to get your business and your debt. For each balance transfer, you need to find and read the small print (usually on the back page) to see what the real deal is. There is often a time limit, a huge penalty for a late payment, and a balance transfer fee that can vary. It is fairly standard to charge 3% of the balance up to a maximum of $75 but this varies. You must read the small print. As far as your actual credit limit...all cards are different. Based on your credit bureau reports and a consistent payment history, most credit card companies will raise your limit but this is never set in gold. Each company will determine just how much they want to make your limit.

Answer 3

You asked, "do all card companies set a specific limit?" They do set a credit limit, but it is based on your credit history and score. The higher risk your previous behavior, the lower the credit limit they are willing to grant. Barclaycard deferred an increase in credit limit for 3 months because they want some proof that you pay your minimum (or more) on time EVERY month, consistently.

In the USA, on the FICO scoring system, 35% of your score is payment history, that is, do you pay on time, every time? Point: to satisfy this test, you must pay at least your minimum.

30% more of your score is credit utilisation: what percentage of your credit limits are you using, that is, how maxed out are you? Generally, if your balance on a card is more than 30% of your credit limit, and the creditor reports your credit limit to the credit reporting agency, you lose points on your credit score. So consider that when you make a balance transfer, you make a trade-off: your new card has a lower interest rate, but it may well have a (transferred) balance that is at or near the credit limit. Watch out for the dreaded Universal Default clause. Under Universal Default, a different creditor can read your credit report and raise its interest rate (to its high Default Rate) because your new creditor, Barclay's, reports a high utilisation rate to the major credit bureaus.

10% more of your score is on attempts to get new credit. Every time you apply for a card (in your case, the Barclaycard for the balance transfer), your potential creditor, here, Barclay's, will make a "hard" inquiry into your credit history, and you'll lose a few points in credit score [and eventually gain them back in a year or two]. People who apply for credit a lot are considered higher risk.

Other critical points: call Barclay's and ask them: on YOUR account, how long will the 0% rate last, and what date will it end? (mark your calendar) Also, what will be the interest rate on YOUR account when the 0% period ends? Also, what is your current balance? If your limit is L950 and your balance is L950, you risk an over-limit fee when they add your finance charges when the 0% period ends, so you should make enough of a payment so that when finance charges are added, you'll be under limit. With these answers, there will be no nasty surprises.

They may have advertised 0% for 12 months, but that privilege goes only to the lowest risk applicants. Higher risk applicants get a shorter period of time, more like 3 months, before the interest rate goes up. See how important direct (phone) communication is with your creditor? Now, some good news: if you have perfect on-time payment history with your creditor and you haven't tripped Universal Default and it's a few weeks before the end of the 0% rate period, you can phone them, and let them know that you're thinking of moving your balance to another company unless they (Barclay's) (1) continues the promotional 0% AND (2) raises your credit limit. Don't take "No" from the customer service rep, ask for his/her supervisor. Don't take "No" from the supervisor, ask for the Customer Retention Department. Don't take "No" from the Customer Retention Department rep, ask for his/her supervisor. Be polite, cheerful and cool at all times; they want to retain you and your lovely balance as a customer! If you get 4 "no" answers by this point, only then should you look for another 0% card. Did all this help?

Answer 4

Charged for transferring a balance from one card to another, this fee is commonly assessed as a percentage of the balance transferred.

When you apply for a new card, ask about balance transfer fees. Most companies don’t charge these fees to new cardholders for the first month or two.
The ability to transfer the balance from one card to another. If applicable, interest on balance transfers begins to accrue immediately.
get more importent information about credit card at: http://www.credit-card-forums.com/forum/20;?ccf805sess=91230687f706fdad018564269f0968ed;Credit-Forum

Answer 5

i just got a halifax 0% int credit card the limit was set at £3500.00 and i could transfer balances of upto 90% of that value