If you have a credit card, you’ve probably noticed that you have a set credit limit. Your credit limit is determined by various factors such as your income, credit history, and credit score. Your credit limit is the maximum amount of money that you can charge to a card, so you’ll only ever be able to spend that much unless you get a credit limit increase. Over time, your card issuer may raise your limit, or you can ask for an increase. Here are some ways a credit limit increase can help you.
When it comes to determining a credit score, several factors are considered. Your credit utilization ratio, or how much of your available credit you use, is one of those factors. This ratio makes up 30% of your FICO® Score. A credit limit increase will raise the amount of available credit you have, meaning the ratio of your debt to your available credit will be lower.