How to get credit limit increase and get more credit cards

On existing credit cards ask for a credit limit increase (CLI), every six months. If you plan on applying for a loan soon, ask that they make a soft credit inquiry so they "don't pull your credit report" and it won't count against you. A hard credit inquiry pulls your credit report from the credit bureaus and lowers your credit score. The keys to achieving a good result are:

1. Demonstrate a need for a higher limit.

Make large purchases or take out balance transfer offers on your card to show that you have enough expenses to max out the limit. The bank will usually ask why you need a credit limit increase, and you should say something that demands a large amount of capital. A common reason is to say that you need to remodel your house.

2. If your credit limit is increased, demonstrate that you can afford to pay for a higher credit line.

The bank will ask you about your income. You can project your expected income including your W-2 wages, 1099 wages, your spouse/partner income (If you live together), and any other side ventures you have. I had a PNC credit card with a $11k credit limit. I told the bank that I needed the CLI to remodel a house, and that I expected to flip three houses this year, earning $30k/ea (reasonable). So I added the potential earnings plus the $90k that I planned to make this year and reported the total to PNC as income. They increased my limit to $50k. Banks like to see an income of at least 75,000 – 90,000 annually.

3. Demonstrate excitement about the card.

Tell the bank that you're currently using bank XYZ's card because it has a higher limit but that you hope to increase bank ABC's limit to make it the "only card in your wallet". The bank should then be motivated to at least match your highest card limit.

4. When the bank asks what credit limit you're requesting, ask for $50k limit or the highest that they can approve you for that day.

5. Banks also like to see stability with rental history and job employment going back at least seven years.

6. In my experience, even with a high credit score I usually get denied credit cards when I look for them and apply without being offered the card. I have over a 75% success rate applying for credit card offers that are explicitly sent to me in the mail with offer codes or as offers when I sign into my credit card accounts to make payments. Your credit card companies sell your information, so others can make soft credit inquiries about you and determine that you would be the right candidate for their products.

The credit card companies study metrics from your consumer information, also known as selection criteria, and determine who to send offers to. The selection criteria can include hundreds of variables that help credit cards get new cardholders at the lowest cost. The first metric they study is the response rate, which is the percentage of consumers who will actually respond to the credit card offers. The second is the activation rate, the percentage of consumers who will actually activate the credit card offer. Third the profit and loss, which includes the profit and loss, minus any costs the credit card can expect to make off from you.

Based on these factors the credit card may select 1,000,000 consumers to target and would expect to get maybe 5000 new cardholders out of this group. The credit card will then contact a professional mail house and have them mail you the credit card offers in the mail. So when you get these offers you've already been pre-approved for the credit card, right? Not exactly, it’s a marketing trick. You’re not already approved, but the marketing companies want you to think so. This way you’ll take the time to fill out the application. However, you do fit into some of the metrics that the bank is searching for so you do have a higher probability of being approved. You’re just not yet “pre-approved” which makes you think you’ve already been approved.

Tip, if you subscribe to high-end magazines such as Forbes, Money, or Travel and Leisure you’re more likely to get pre-approved offers from high-end credit cards.

For more credit card information, check out my latest Amazon book.

How to Boost Your Credit Score Range and Make Money With Credit Cards.: How to Repair Your Credit With Credit Repair Strategies. (Entrepreneurship Book 3)