Credit Limit Increase Rules for Each Major Credit Card Issuer

hey guys it's a passion from a Sebby and today we're gonna talk about the credit limit increase rules by most of the major issuers but first if you are new here we're all about how to maximize the value of your credit cards so how to get the most cash back and also how to travel for free and that sounds interesting and subscribe to our Channel but let's get started one thing I want to clear up from yesterday's video since a lot of people seem to be a bit confused is that if you are at a situation where you get a free credit limit increase and there's no cost so no inquiry and make sense to do it so whether it's given to you or whether you have to request it if it's free and there's no cost there's no reason not to do it technically there are some very specific use cases but again for most people I don't think you need to worry about them yesterday's video was mostly focused on times where you either take on a hard inquiry to get that credit limit increase or take on a hard inquiry to get a new credit card the whole idea is that you're better off getting that new credit card because it's going to keep your sign up offer as well as that increased spending power as well as higher utility because we're getting more diversity in your cards and you're also increasing things that help your credit score in case you wanted to convolute an example imagine if you were at a restaurant and they gave you water for free so if they offer to refill it for free or if you can refill yourself for free there is no reason not to just drink it as much as you want until you're happy because there's no cost to it on the other hand though if you do drink the water and let's say there is a cost to refill it so let's say you drink this whole thing and they're like hey if you want to refill it it's $5 if you are in that situation and they're like hey you either do that for $5 or you get another drink maybe a coffee maybe a soda maybe a juice also for $5 I'm not gonna refill this water because for me like I'm not gonna pay for top water so for me I'm rather spend that $5.00 getting a new different drink that has a higher utility and a higher benefit to me just because things taste better than water to me so it really just depends on you but in that situation if the cost is still the same so again the cost in this case is five dollars or a heart inquiry you might as well get something new that technically costs more is more valuable moving on to the topic of this video we're going to Brent on different issuers and tell you their specific roles really that's a credit limit increases wealth American Express there are no heart korie's for credit limit increases and you can typically increase your credit limit up to 3x the initial amount once you hit a certain level of credit limit it might actually not make sense to do this but we're going to cover that a bit more towards the end of this video on the other end of the spectrum we have chase where credit limit increases will have hard inquiries with Barclays it gets a bit interesting so if you initiate a credit limit increase so if you call in and you ask for one then there will be a heart inquiry but if you wait for them to automatically do it there will not be a hard inquiry so they oftentimes will give you credit limit increases every six months so if you do want one I'd probably just wait for it there's no reason to call in because you're taking on a hard inquiry for no reason but Citibank it's either going to be a hard inquiry or soft and query the really good thing though is that when you make that request they're going to tell you this means that when you call in check their website or check their mobile app they're going to tell you specifically whether that credit limit increase request will lead to a heart inquiry are soft inquiry in this situation if you check and it says that it's a soft inquiry and you do want more credit limit of City then I think it's a logical move to do it because again there's not really any cost if you check in it says it's going to be a hard inquiry then to me it makes more sense applying for a new city card just because you can get a sign up offer and again sign up offers typically give you between $200 to $1,000 in value another way to think about it is that of most credit cards you're getting between 1% and 5% return under spend so if you spend $100 you're either getting $1 back or $5 back depending on the card well sign up bonus is you're typically getting between 10% and a hundred percent return on spend this means that again if you spend the same hundred dollars you're getting either $10 back or $100 back instead of the $1 back to the $5 back what Bank of America if you do a credit limit increase it's likely going to be a hard inquiry unless you have a special offer when you log in to their website if you do have a special offer available to you it won't clearly mentioned that there is no heart inquiry well Wallis Fargo it could either be a hard inquiry are soft inquiry so I'd recommend calling in to ask which 1lb of us Bank it's a soft and query it's a pretty straightforward with capital 1 it's also a soft inquiry and you can make a request to increase your credit limit every six months we'll discover it's pretty interesting just because they have a tool specifically built for this and it can lead to either result for the tool what you need to do is enter to the credit limit increase you want so let's say you currently have a card of $2,000 and you want to increase it to $5000 so you're making your request for $3,000 once you enter that number in Discovery will tell you whether that number is fine or whether they're going to recommend you a lower number if they tell you your initial request is fine or if they gave you a secondary offer and you choose to accept it then it's going to be a soft inquiry if you do the secondary review to do the higher limit increase then it's going to be a hard inquiry towards the beginning of this video I mentioned that you might not want to make credit limit increases with MX and one of the main reasons is because it might lead to a financial review a financial review is when MX is risk team sees that there is something that's high risk and they're worried so what they do is it frees all of your cards with them during the financial review what they ask you to do is to send in a tax form that allows them to see your tax returns for either one year two years or three years as well some other details like employment information if you choose not to comply up their request they're going to shut down all of your accounts for most people this is going to be fine and you're going to go through the process but it's still pretty annoying one of the factors that lead to financial review is if you have a credit card that has more than a 25,000 credit limit by itself so let's say you start off with a credit card that has a $10,000 credit limit and then you would do a credit limit increase that gets up to $20,000 and let's say you'll do another one that gets you up to $30,000 once you pass the $25,000 mark it's going to trigger the financial review another thing that triggers at two is that if your total credit limit of Amex is more than $35,000 for example if you have three cards one that has 15 dozens another one that has 15,000 and a third one that you increased from 5,000 to 10,000 you technically passed the $35,000 mark and that's going to trigger the reveal a next charge cards don't really come into this equation since they don't really have a credit limit so it doesn't really affect it and again the financial review is not too bad it's just really annoying because you have to call them a few times and send a bunch of documents and again they can't ask you for your bank account statements as well as your other financial documents like your tax return so I hope that was helpful and let me know if you guys have any questions my question for you guys is which pay for more water let us know down below and if you like this video give it a thumbs up it really helps us out and if you know anyone else who's benefit from what you starts about feel free to share this video with them because it's probably gonna help them up but the whites hope you guys liked it see you next time [Music]

Channel: Ask Sebby

Views: 191,760

Keywords: increase credit limit, credit limit increase, credit score 101, credit cards hard inquiry, credit score tips, increase credit score, how to increase your credit limit, credit card limit, understanding your credit card, should i get more credit cards, why you shouldn't ask for a credit limit increase, asksebby, hard inquiry credit, soft inquiry vs hard inquiry, how to raise credit limit, how to increase your credit card limit, credit card utilization, boost credit score, FICO

Id: tSz5kOTn-Ig

Length: 7min 13sec (433 seconds)

Published: Sun Jul 30 2017