Credit card issuers are fighting to earn the top-of-wallet position, meaning they want their card to be the go-to option for your spending needs. To achieve this, they are more inclined to offer credit limits that are equal to or higher than your existing limits. It is unlikely that you would prefer to use a card with a lower limit than your other cards. Moreover, credit card companies are more confident in extending higher credit limits to those who have already proven themselves capable of managing higher credit limits successfully.
Consider the following example: if someone has two credit cards with a limit of $1000 each, it is unlikely that a new creditor would issue them a $10,000 limit. However, if each of the four cards had a limit of $10,000, the likelihood of being granted a higher limit by a new creditor would increase significantly.
In addition to seeking out creditors known for offering high-limit cards, consider consolidating multiple cards with a single issuer to increase the average limit. For example, instead of maintaining three Chase cards, combine them into one card with a higher limit, ensuring that your oldest card remains active to preserve the age of my credit portfolio. By doing this, new issuers are more likely to grant me higher initial limits.
The benefits of having higher-limit cards are numerous. They help keep utilization ratios low, which is crucial for maintaining good credit scores. Furthermore, with a large number of cards each with a limit above $30,000, it’s difficult to use up a significant amount of the limit, especially if you pay your bills in full each month. This contributes to keeping your credit score high, which in turn makes it easier to get approved for new cards in the future.