Question
I have been offered a credit limit increase on my credit card. They are offering me a £750 increase, and my limit is currently £1,500. I need to complete an income and expense form online and then it looks as though they automatically increase my limit.
I just wonder if this is something that will help my credit score or hurt my credit score?
Any advice would be appreciated.
Ian
Answer
Ian,
You ask a good question, and depending on the balance, if you carry one on your credit card, the increase could help your credit score.
If you carry a balance on your credit card, the closer you are to the credit limit can lower your credit score. If the credit limit is increased, it can then improve your credit score as you now seemingly are not close to the limit.
Keep in mind, just because the credit card company increases your credit limit, does not mean you need to spend to that limit or use the card.
Regards,
Jon