Credit card: increase credit limit.
How can the credit card availability limit increase? What are the requirements for this? How is this done? And that’s why a second chalk card is a good alternative.
Credit card availability: what does that mean?
Every credit card holder receives a credit line from the bank. This means that he knows the scope within which he can regularly carry out target sales. Once the credit card limit has been reached, payment processes or cash withdrawals are no longer possible.
The amount available varies depending on the bank. Many banks grant a flat-rate credit line, while other institutions set it individually based on their monthly net income. The basis is the assessment of the creditworthiness when applying. The latter is more common.
When does it make sense to increase the availability limit?
If the credit card is used for payment, the system checks whether the requested amount of money is within the available limit. If so, payment is approved. If the limit is too low, it is possible to increase it and thus create more financial scope. There are many reasons for this, for example for a longer holiday trip or other expenses that should be paid for with a credit card. A larger budget means financial freedom and security. Therefore, many cardholders strive to do so, even if they don’t actually need such a large card limit.
The prerequisites for an increase
Consultation with the bank is required for the increase. The financial institutions are also obliged to carry out a credit check again in the event of an increase by law. If this turns out to be positive, the available amount can be increased.
Proof is easy to provide, for example, in the event of a salary increase. If the possible limit has not yet been fully exhausted, an informal notification is sufficient, because then no re-examination is necessary.
Another requirement is that credit card bills are always paid on time. Return debits or delays in the manual payment of invoices make the bank question its credit rating. Frequent use of the installment facility also has an adverse effect on creditworthiness.
The procedure for increasing the availability limit
If the credit limit wants to be increased, you can either increase the credit limit of the credit card, subject to certain conditions, or you can deposit an amount into the credit card account. The amount paid is available in addition to the limit. This is recommended if the bank has rejected the increase in the credit limit due to a negative credit check or if one-time expenses are to be carried out with the credit card.
Existing savings can also serve as a basis for accepting the increase in the available limit. Often, the credit card holder does not have to apply for the increase separately because the bank automatically offers him an upgrade. This is often the case if you pay regularly with your credit card. The amount of expenditure is used to make the bank believable that income or assets are high.
Overview of tips for a higher credit card limit:
- Prove creditworthiness because it is the most important criterion
- Generate positive attention from the provider (punctual payment of credit card bills)
- only spend amounts that are within the credit line
- Avoid late payment
- Use your credit card regularly
Alternative: the purchase of a second credit card
If you want to increase the credit card availability limit, you should note that this also carries various dangers. On the one hand, it is more difficult to control expenditure and, on the other hand, the amount of damage can increase in the event of misuse. In order to increase the financial scope, it is also possible to apply for a second credit card from another provider. This can be useful, for example, if the credit line specified in the application has been exhausted or exceeded.
Of course, it can also happen that the credit card breaks, the chip on the card stops working, or it has been stolen. In the latter case, immediate blocking of the card is very important. But if you want to continue paying without cash in these cases, you are well advised to use a second credit card.
Another advantage of secondary cards is that they can be used for different purposes. Many consumers use one card for personal use, while the other credit card is used for business expenses.
The credit limit describes the financial margin available to the holder on the credit card. The bank decides how high the individual card limit is. With the tips and requirements mentioned above, you can increase your credit card availability.