How do credit card companies calculate your max credit limit increase?

Question

I'm wondering how credit card companies calculate how much I can increase my credit limit. Do they base it off of annual income? I'm wondering if they'll approve a credit limit increase to 10,000 stones if I make 10,000 stones a year.
Thanks.

I'd like to be able to find out what my max credit limit is given 'x' factors.

Answer 1

It is most likely too complex for you to calculate. I can say a few things, it would have nothing to do with your income.
There is some maximum from your current limit, no matter what, the account usage patterns, payment history, current credit score, time open, etc all factor in the decision.
Really that is all moot. You call up ask for a credit line increase, get what they give you and done.

Answer 2

Besides debt/income ratio, they also factor of how much available credit you already have as a whole. For instance, if you have 3 credit cards with high credit line of a total $40,000, the 4th credit card you apply may not have the same credit line that you thought you should get. Your credit exposure is sufficient already. Credit card company may not give you anymore credit with the fear that you will default the loan that you will not able to pay.

If you only make 10,000 a year, I don't see why they would approve 10,000. Unless the credit card company charges you an outrage interest and wants to get you into more debt. The responsible credit card company would not allow you to have that kind of increase. They have to protect themselves too. It could be a mistake.

Maybe your have lots money in saving or asset that can turn into cash at anytime.

Answer 3

They, lenders/financiers, figure your max borrowing capacity X's your "debt to income ratio".

""Debt"" being 'relative to' overall money that must be paid out weekly, monthly, yearly, for you to survive and pay off already outstanding debts and maintain the same level of sustainability you have now set in place which does not compromise your current abilities to settle and satisfy current dues!

Say you want to borrow 10,000 stones, and you make 10,000 stones per. year. How long do you plan on paying back this 10,000 stone that is exactly your yearly income.

+

If you total all bills, auto + home/insurances + utilities/taxes, etc, and it's relative number in relationship to 10,000 stones per year is what? = You'll only have how many stones left to spend for the rest of the year? Will this leave you weighed in the balance and found wanting or in abundance?

Some people earn small wages, yet take out massive home loans, but they repay them slowly in time over many many years. So the debt ratio works positively because the repayment amount is smaller X's so many years.

So, here are the criteria.

Annual Income
times and by
Current Debt/status-terms of that debt
by and times
Total misc. expenses relative to needs + shelter/transportation, health care etc. needs. = your total borrowing capacity.

also factor in

What do you want the new credit for/type of credit applying for + terms of that credit limit/funds and fees = Limit!

Remember if it changes the credit course of any other obligations, factor that in as well and look in advance to any changes that might occur from such "transfers".........