How close can I get to my credit limit?

Hello,
I have a credit limit of £2,750.00 on one card, and it has a balance of £1,192 so there is £1,558 available. Am I ok to spend £1,100 without it affecting my credit worthiness? There would be £458 available and the credit card is paid off in full every month. I would not make any further purchases this billing cycle.
Thanks

Comments

  • The credit card being paid off in full every month means the amount on the card is irrelevant, there is no credit "worthiness" - your account being cleared monthly shows you are a good borrower. Credit balances are the only thing to worry about - where a card is not paid off in full every month and even then with something like a BT promotional rate it's of limited impact 
  • DullGreyGuy
    DullGreyGuy Posts: 8,983
    First Anniversary First Post Name Dropper
    Forumite
    Each lender has its own criteria and so what one loves another may hate, though obviously its normally more subtell than that. If you are paying off in full each month then most are unlikely to care how close you get as long as you dont go over
  • MalMonroe
    MalMonroe Posts: 5,783
    First Anniversary First Post Name Dropper Photogenic
    Forumite
    Lenders, including credit card companies, don't look favourably on those who borrow to the limit. And if you check your credit reports, most credit reference agencies will warn you if it appears that you are using too much of your available credit.

    There was the 30% rule - that is, don't use more than 30% of your available credit, in order that you can show that you are not credit hungry. Not sure if that's still a thing.

    However, it doesn't matter as you are paying off your balance in full every month and intend to continue to do so, it probably won't impact your credit report. You are showing any prospective lenders that you are in control of your finances. All good!
    Please note - taken from the Forum Rules and amended for my own personal use (with thanks) : It is up to you to investigate, check, double-check and check yet again before you make any decisions or take any action based on any information you glean from any of my posts. Although I do carry out careful research before posting and never intend to mislead or supply out-of-date or incorrect information, please do not rely 100% on what you are reading. Verify everything in order to protect yourself as you are responsible for any action you consequently take.
  • cymruchris
    cymruchris Posts: 4,880
    First Anniversary First Post Name Dropper Photogenic
    Forumite
    You might get some 'dire warnings' coming through the likes of credit karma that your utilisation is out of control - but as you're paying in full each and every month, it's not something to be worried about. I'm not sure why they aren't able to look at your payment pattern to see you've been paying off in full before spurting out their dire warnings, but then they also make up imaginary credit scores too.. 
    An ex-bankrupt on a journey of recovery. Feel free to send me a DM reference credit building credit cards from the usual suspects :) Happy to help others going through what I've been through!
  • molerat
    molerat Posts: 31,504
    Name Dropper Photogenic First Post First Anniversary
    Forumite
    ^^^^ This.  I get that every time I go over 30% use on a card even though I am at around 5% of my total credit availability.  I also get messages that I have increased / decreased my credit card debt even though all my cards are paid off in full each month.
  • Thanks everyone - good to know that it should not have any effect on my credit score to make the purchase. Really appreciate it. 
  • cymruchris
    cymruchris Posts: 4,880
    First Anniversary First Post Name Dropper Photogenic
    Forumite
    Thanks everyone - good to know that it should not have any effect on my credit score to make the purchase. Really appreciate it. 
    The score might go down - it might go up - but don't worry about it. Only you see it. It's your history that's most important. 
    An ex-bankrupt on a journey of recovery. Feel free to send me a DM reference credit building credit cards from the usual suspects :) Happy to help others going through what I've been through!
  • MalMonroe said:
    Lenders, including credit card companies, don't look favourably on those who borrow to the limit. And if you check your credit reports, most credit reference agencies will warn you if it appears that you are using too much of your available credit.

    There was the 30% rule - that is, don't use more than 30% of your available credit, in order that you can show that you are not credit hungry. Not sure if that's still a thing.

    However, it doesn't matter as you are paying off your balance in full every month and intend to continue to do so, it probably won't impact your credit report. You are showing any prospective lenders that you are in control of your finances. All good!
    Point 1 - With the OP scenario - if you use your card even to 99.9% of the limit and pay it off in full every month, all other lenders see is an ocean of green ticks of paid in full = look 100% favourably on you

    Point 2 - there is no 30% rule. At all. This is another credit score gimmick, it isn't a thing because it never was a thing. I have more than 50% of my available credit on 0% balances, all 3 of my BT cards are currently only 50%. It has not stopped me getting new cards when I want them. A solid record of paying off on time is all that matters

    Point 3 - that contradicts your first point!
  • phillw
    phillw Posts: 5,589
    First Anniversary Name Dropper First Post
    Forumite
    edited 8 November 2022 at 11:29AM
    Any credit you apply for after the statement has been generated, and before you pay it off, will see you have more outstanding debt. This may change their lending decision.

    Unless you're going through a mortgage application and have already told them how much you owe and you're about to load up with more debt shortly before completion, then I wouldn't worry about it.

    Mortgage lenders can (and do) perform a last minute check of your credit file to make sure your situation hasn't changed.

Meet your Ambassadors

Categories

  • All Categories
  • 341.6K Banking & Borrowing
  • 249.6K Reduce Debt & Boost Income
  • 449.1K Spending & Discounts
  • 233.7K Work, Benefits & Business
  • 605.8K Mortgages, Homes & Bills
  • 172.3K Life & Family
  • 246.6K Travel & Transport
  • 1.5M Hobbies & Leisure
  • 15.8K Discuss & Feedback
  • 15.1K Coronavirus Support Boards