How do I Increase my Credit Line?

Lainie Petersen

Getting an increase in your credit line is usually a matter of demonstrating responsible financial behavior, having the assets and income to meet your financial obligations, and asking your creditor for a credit line increase. Most creditors want to see a history of making on-time payments, staying within your credit limit, and evidence that you have a good track record with your other creditors. Before increasing your credit limit, a creditor will also want to know that you have the cash flow to continue making payments. Some creditors offer the opportunity to increase your credit through their website or on the phone. If you want to increase your home equity line of credit or a business line of credit, you may need to work directly with your banker.

Proof of income, such as a pay stub, may be necessary for a credit line increase.
Proof of income, such as a pay stub, may be necessary for a credit line increase.

In many cases, a creditor won't consider giving you a credit line increase until you've had your account for at least six months, although some department store credit cards may offer you an increase after four months of on-time payments. After six months of paying your bills on time, you can ask the credit card company to raise your credit limit. If you use your credit card company's website to manage your account, you can often make the request online. If you can't figure out how to make an online request or your credit card company does not offer online credit line increases, call the toll-free number on the back of your credit card. Explain to the customer service representative that you would like an increase in your credit limit.

Credit cards may automatically increase a credit line for people who pay off balances on schedule.
Credit cards may automatically increase a credit line for people who pay off balances on schedule.

While many creditors will automatically increase your credit line upon request, some will ask for proof of your current financial situation, such as pay stubs, and may pull your credit report. If this happens and you have other credit problems, you may be in for a nasty surprise. Credit card companies can decrease your credit line and even increase your interest rate if they see that you are not paying other debts as agreed. The same holds true if you are applying for a home equity line of credit increase or need a larger credit line for your business. Your banker is going to want to look at your current situation before extending you more credit.

Some companies will pull an account holder's credit report when a credit line increase is requested.
Some companies will pull an account holder's credit report when a credit line increase is requested.

Credit line increases have both benefits and pitfalls. Your debt to available credit ratio factors into many credit scoring systems. The more available credit you have in comparison to what you are actually using works in your favor, giving you a higher credit score. On the other hand, some creditors look beyond your credit score and into what is actually in your credit report. If that creditor is worried about you having too much available credit, even if you aren't using it, the creditor may decline your loan application or not give you the interest rate you want.

Having a history of making payments on time increases a credit line.
Having a history of making payments on time increases a credit line.

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