Salary

ratttyo

Why do credit cards bother asking how much your earning? As your earnings have no bearing on what credit limit your set as they do no contact your employer?

nickmack

ratttyo wrote: »

Why do credit cards bother asking how much your earning? As your earnings have no bearing on what credit limit your set as they do no contact your employer?

To help assess your ability to repay. Although they don't necessarily contact your employer, strictly speaking you could be prosecuted if you obtained credit using false disclosures.

aj3001

It helps them give you a credit limit I believe, my first two cards gave me a limit of 1 months income before tax

jamalfatty

ratttyo wrote: »

As your earnings have no bearing on what credit limit your set

Of course it does! Do you think someone earning £500k+ would get same limit as someone earning £20k?

ratttyo

Well Jamalfatty

I dont think they check at all your salary defintely not in my case this has never been done. If so I'd definitely i'd be elegible for bigger credit limit.

Are you speaking from personal experience?

YorkshireBoy

ratttyo wrote: »

I dont think they check at all your salary defintely not in my case this has never been done. If so I'd definitely i'd be elegible for bigger credit limit.

If you're considering inflating your salary, in the hope of a better credit limit, you should first educate yourself in the workings of the fraud prevention agencies.

http://forums.moneysavingexpert.com/showpost.html?p=3527841&postcount=15

It's extremely hard to get credit with a CIFAS marker against your name!

doitmyself

ratttyo wrote: »

Well Jamalfatty

I dont think they check at all your salary defintely not in my case this has never been done. If so I'd definitely i'd be elegible for bigger credit limit.

Are you speaking from personal experience?

fatty's very opinionated but not necessarily so knowledgeable. The question's good, I guess salary's a determinant of sorts, part of the 'affordability' thing but it's done on trust on the basis, as nickmack said that false disclosure is a crime. Same as all the other dets, name/add etc. you provide.
Who gets the higher limit, the 20k a year with no debt or the £500k a year with £600k debt?
fatty?

ratttyo

Who gets the higher limit, the 20k a year with no debt or the £500k a year with £600k debt?
fatty?

This is my point.

If you're considering inflating your salary, in the hope of a better credit limit

No but your salary should be confirmed properly surely? Banks do ring your employers when opening new account dont they?

jamalfatty

doitmyself wrote: »

fatty's very opinionated but not necessarily so knowledgeable. The question's good, I guess salary's a determinant of sorts, part of the 'affordability' thing but it's done on trust on the basis, as nickmack said that false disclosure is a crime. Same as all the other dets, name/add etc. you provide.
Who gets the higher limit, the 20k a year with no debt or the £500k a year with £600k debt?
fatty?

Until recently I worked in the credit department of one of the large credit card companies so speaking from experience.
It would not be possible to check every applicants employer and they certainly wouldnt give out salary information anyway. The forms will also ask for your job title and this is usually a decent indicator of if you are telling the truth about your salary.
If you fabricate anything, more often than not you will either be declined, or asked to send in proof of income.

In your example above, the high earner would probably still get the much higher limit, that debt could be a mortgage which at just over 1x salary is much lower than the average debt.
You cant base it on just those figures though which is where the CRA's come in and historical data from similar demographics.