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Credit card Limits
Runningfast
Posts: 224 Forumite
Just a general question.
Why do Credit Card companies give out larger credit limits than applied for?
If I apply for a loan and my application is successful I get the amount I applied for but with credit card companies I have always been given more than I want
As an example I have just applied for a Halifax Clarity for travelling purposes (I travel a lot) it says the minimum limit is £500. It asks how much you want to apply for so I said £1000.
It says application successful have £2900. I didn't want £2900 I wanted £1000 max as I have other cards with lower APR's, money/balance and purchase deals that I use for emergency spending in the UK.
So does anyone know why they give larger limits than applied for ? Im just curious.
Why do Credit Card companies give out larger credit limits than applied for?
If I apply for a loan and my application is successful I get the amount I applied for but with credit card companies I have always been given more than I want
As an example I have just applied for a Halifax Clarity for travelling purposes (I travel a lot) it says the minimum limit is £500. It asks how much you want to apply for so I said £1000.
It says application successful have £2900. I didn't want £2900 I wanted £1000 max as I have other cards with lower APR's, money/balance and purchase deals that I use for emergency spending in the UK.
So does anyone know why they give larger limits than applied for ? Im just curious.
0
Comments
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In the hope that you will be tempted to spend more and pay them lots and lots of lovely interest.£1000 Emergency fund No90 £1000/1000
LBM 28/1/15 total debt - [STRIKE]£23,410[/STRIKE] 24/3/16 total debt - £7,298
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you can call them and they will reduce it to £1000.0
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There may be a time you're thankful they gave you a higher limit, being as you'd have been limited to a £500 cash balance on a £1K credit limit due to their '50% rule'.0
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YorkshireBoy wrote: »There may be a time you're thankful they gave you a higher limit, being as you'd have been limited to a £500 cash balance on a £1K credit limit due to their '50% rule'.
True, there is that. Normally I take a mix of cash and cards on holiday so I would think I will never never need to withdraw more than 50% of the limit. I haven't so far and have been to over 30 countries in last 3 years.0 -
afzaal1988 wrote: »you can call them and they will reduce it to £1000.
I may well do that, though I have very good control of my spending habits never have an outstanding balance etc. My other credit cards have limits well above the Clarity and I have never been anywhere near those limits.0 -
andyfromotley wrote: »In the hope that you will be tempted to spend more and pay them lots and lots of lovely interest.
That went through my mind. Reminds me of my time with Barclaycard about 8 years ago the credit limit seemed to rise every month. The less I spent the more letters I got reminding me that I had a card and the limit went up about 1k each time.0
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