Recent increase in credit limit

jpaul1

Hi all,

I've had my Barclaycard now for around 12 months with a credit limit of £500. I've been spending £200 to £250 a month and paying the balance in full each month.

Recently Barclaycard have increased my credit limit to £2000.

I'm happy with the increase, but I was wondering if I should increase my spending or keep it the same so that they keep increasing my credit limit. If I spend more, will it have a negative affect on my credit rating?

Thanks.

thenudeone

As long as you spending and balances are reasonable in relation to your income, it shouldn't cause a problem to shift more of your existing spending on to your card.

Don't spend anything just because the credit facility is there.

fozmcfc

Depends on how disclipined you are.

If you just spend like there's no tomorrow, then can't afford to pay more than the minimum back, it can get out of hand.

I had a mate who was unemployed and everytime he got a limit increase on his Barclaycard, he ended up spending on it and they just kept on upping the limit until it was at £11k.

A credit limit is that, a limit, not a goal, i.e. you don't need to spend upto it.

An increased limit, usually means you are becoming more credit worthy, which is good.

Downfall of having high limits and/or high balances, that are not cleared within a few months, can impact getting credit elsewhere.

That's because if you say earn £12k a year and have limits and balances amounting to £6k, you have a high limit/balance on cards, compared to you annual income, and this can mean you might not get credit elsewhere, as it may be seen as overstreching yourself.

As long as spending is kept under control and stay within your means, particularly if something like a loss of income occurs, then it won't be a problem.