Typical credit card limit in comparison to income

rookie91

I'm curious as to what people's income is and their total credit limit on their credit cards. I'm looking to increase my credit limit and want to know how credit lenders factor income into their calculations.

 

sourcrates

Not a good time to be thinking of credit at all to be fair, and certainly not getting any deeper into debt.

eskbanker

rookie91 said:

I'm curious as to what people's income is and their total credit limit on their credit cards. I'm looking to increase my credit limit and want to know how credit lenders factor income into their calculations.

There are many factors involved in setting limits, so isolating one in particular won't be as informative as you think....

[Deleted User]

You'll get a thousand different answers as the lender strategies vary wildly and income is only one of the factors.

Better to ask for advice specific to your circumstances.

dr_adidas01

rookie91 said:

I'm curious as to what people's income is and their total credit limit on their credit cards. I'm looking to increase my credit limit and want to know how credit lenders factor income into their calculations.

 

You can’t focus on income alone as it’s not the sole factor that lenders use when determining credit limits or credit limit increases. 

dr_adidas01

sourcrates said:

Not a good time to be thinking of credit at all to be fair, and certainly not getting any deeper into debt.

Perhaps not for you it isn’t, there are lots of people managing quite well despite the current economic downturn. 

Grabs39

As others have said it's not as black and white as that.  My current available limits are around 70% of my gross salary.

However my wife earns 50% more than me, I'm a homeowner and I've worked for the same company for the last 7 years (all things that you're asked about when applying for credit)

northwalesd

Just to give you another of the 'thousand different answers', my available credit is only about 20% of my gross salary (though prior to the Asda Creation card closure it was around 32% - I currently haven't replaced that card).

rookie91

sourcrates said:

Not a good time to be thinking of credit at all to be fair, and certainly not getting any deeper into debt.

I agree with the sentiment but I'd be looking to do a balance transfer and not take on any additional debt. I would also like to keep my current credit card as it has a large credit limit and would help to keep my credit utilisation low.

Currently my total card limit is about 30% of gross income. I've asked one of my credit card companies (Nationwide) to increase my credit limit further which would boost my credit limit to 54% of gross income.  I don't actually need the extra credit but my credit utilisation is currently 72% and in 6 months time, I would like to do a balance transfer so thought reducing the utilisation would help. If i get the new limit with Nationwide, my credit utilsation drops to just under 40% (would drop even further in 6months).  Then to get the required credit limit for the balance transfer in 6 months, my credit to income percentage would need to increase further to about 75%.

Would this be the best way to maximise my chances of getting the balance transfer in 6 months or shall I approach it in a different way (other than reducing the debt i'm already carrying)?

P.S I don't have a mortgage, loan, rent, kids or any other major expense (other than utilities and council tax) and this should still be the case in 6 months. Also my credit file is impecable (No missed payments).

Hope everyone is able to follow

Nebulous2

My total credit limit on cards hasn't been under my salary in 20 years. At times it has been more than double.

Once some lenders trust you others tend to do the same. Back in the early 2000s, prior to the credit crunch, I received a £10k limit for about 6 applications in a row.  Then availability dried up and I stopped applying. Around 5 years ago credit suddenly became much easier again, with unsolicited limit increases. Now it is tightening again, and I can't see me applying for some time. 

ARH_2

You've asked for more credit recently with one lender. I'd suggest that doing anything else should be avoided until you want to apply for that balance transfer in 6 months, otherwise that future lender will see it as third application for credit in six months, which could be more of an issue than credit utilisation. 

To answer your question, 56% of gross income across four cards. Different lenders clearly have different approaches, and their perception of disposable income (which can be used to repay) is likely crucial.