| Low or High Credit Limit Credit Card |
| By Credit Federal |
Published
01/29/2009
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Unsecured Credit Card
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Know Your Available Credit Limit on Your Credit Card
Ever wonder why there is information about your 'Available Credit Line' on your credit card statement? This information is important because it represents how much; total, you are able to charge. If your charges add up to be more than the available credit line, extra over limit fees may be added onto your bill. Never max out your credit card's available credit. Pay attention to your running limit total and strive to keep your credit card balance way below half of the available credit amount. For example if the available credit line is $5,000, make sure the balance owed on the card is less than $2,500.
When credit card debts are over 50% of the available credit amount, it can lower credit scores. Credit scores are important for consumers seeking loans or other lines of credit, and possibly even those seeking employment (or job advancement), an apartment, cell phone or other credit score sensitive items. Your credit score decides not only approval or rejection, but also what interest rate (and available credit limit) you'll have. If there is a need for a high limit loan, monitor all three credit reports at least six months in advance and work to get the highest possible credit scores before you apply.
Some of the easiest ways to lower credit scores is to pay debts late or have credit cards with balances due that are close to the available credit line – even if it is only close to 50% of the available credit. When credit reports show late payments or skipped payments it shows a greater risk to lenders and may get you higher interest fees because of the risk to lenders. Check the 'Available Credit Line' on all your credit card statements and stay ahead of the credit score game.
Submit an online application for an unsecured credit card.
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