How to Qualify for the Highest Credit Card Limit: Things to Look Out For
Whether it is just for shopping, paying bills or improving credit history, credit cards are crucial components of our financial lives both personally and for business. In properly managing credit cards, it is always advisable that an individual consider a lot of factors in order to maximize your credit potential. From your interest rates, total balance, to due dates, these factors are very important as they play a major role in how much you may qualify for in the future.
One important factor that many people forget about in managing their cards is how to manage their credit card limits. In simple terms, a credit card limit is the maximum amount that the credit card company or the lender for that matter, will allow you to borrow. While many people are able to see their credit card limits increase over a period of time as a result of good credit scores and history, it is not the only strategy. This is because lenders always look into various factors before approving you for the highest credit card limits.
What exactly are the factors that are required for you to qualify for the highest amounts on a business credit card? If you are not sure about the answer to this question, take a look at the following factors.
Credit Score Range
To put it into perspective, a credit score is a 3-digit number that reflects the information a person’s credit report. It is the document that shows your creditworthiness.
With that in mind, credit score range refers to the rate of your creditworthiness and can fall anywhere between being bad, fair or excellent.
As far as getting the highest possible credit card limits is concerned, many lenders will base a large portion of its decision on the score itself. This means that the lender can ascertain, through your credit score that you are worthy and able to pay the borrowed money in time and without fail.
On the contrary, having a bad credit score may not even allow you to have a business credit card. Therefore, if you are striving to positively exploit your credit card limits to the maximum, then consider indulging in activities that only works towards raising your credit scores.
Proper Utilization of Credit Card
This refers to the total of credit card percentage limits that you are utilizing. In other words, it is the rate at which you are using the credit card limits provided to you by the credit card issuer. The way you utilize your credit is often calculated by determining the totality of your credit card balances against your general credit card limits. In most cases, a lower percentage would be an indication of a strong credit score. It is often advisable to utilize your credit to less than 30%, but more than 0% to attain a commendable credit score.
The Length of Your Credit History
By this point, you must have realized that your credit score plays a major role in deciding your credit card limits. The length of your credit history indicates the duration that you have been building your credit. Having a long credit history makes it easy for lenders to easily assess your creditworthiness and decide whether you are fit for the highest possible credit card limits.
Generally, lenders will also take into account both your current credit accounts and closed ones and find out why they were closed.
Credit Repayment History
Lenders also look at repayment history, which shows how often you repay your card debts within the stipulated time. Lenders want to make sure that you are responsible with your lines of credit, a factor that will help them in setting your credit card limits.
To this end, it is worth noting that qualifying for the maximum credit card limits requires you to stay on the right track in terms of keeping a clean credit score. From having an excellent credit score, perfect credit utilization rate, positive credit repayment history to having a healthy credit history, everything depends on having a strong credit score.