About 5 months into my first credit card experience, I decided that it was time for a credit line increase. No, I wasn’t racking up debt and no, I didn’t have any large expenses that made the credit increase necessary. I wanted an increase because when you have $1,000 each month, it’s easy to have over a $2,000 balance right before the bill is due. With a credit limit of $5,000, that equals a 40% utilization rate, something I’d definitely prefer to stay below. Add in the fact that Bank of America mysteriously skipped a billing cycle and that rate jumps to around 60%.
Sure, it’s not always that high and only if my accounts are checked on those days would it be marked that high, but I’d like to avoid the worry altogether and assure myself that my credit rating is as good as can be. It’s not imperative now, but it’s always good to keep a good credit score.
We know that hard inquiries negatively affect your credit score, so I decided that while I wanted to increase my credit line, I wouldn’t do it if it meant a hard inquiry.
Also, I have great news. Bank of America has one redeeming quality: it makes increasing your credit line very easy.
After logging into my account, I clicked on the “Request a credit line increase” button, filled out the form, and requested another $2,500 in credit.
The next day, I received a call to verify my job, income, and reason for requesting an increase (I have heard that saying that you’ll be making some large purchases works well).
I was approved immediately with only a soft inquiry and suddenly my utilization rate dropped. That same 40% utilization rate suddenly turned into less than 27% on the worst days, something I can definitely accept.
It’s only a small part of my credit score, but every bit helps and good habits now will help when we need it.