Strategerizing my next steps - CLIs?

[supern8ural]

Good afternoon all

 

This is way premature and won't be relevant for a couple months but I still am thinking about this - let's be honest, I'm kind of obsessing about getting my credit as right as possible now, so I can get my financial life back on track.

 

In a nutshell my current strategy is to try to get CLIs on a couple of my lower limit cards as soon as possible.  I found this article which is interesting

 

https://www.doctorofcredit.com/credit-cards/which-credit-card-companies-do-a-hard-pull-for-a-credit-limit-increase/

 

here are my currently held cards

 

BoA Customized Cash Rewards Signature Visa, $32,500 CL, 11y6mo, auto-CLI'd sometime in April or May this year ($4k increase)

JPMC Freedom Unlimited, $18,400 CL, 16y1mo, converted from Slate to Freedom Unlimited in June with an auto-CLI in April (also $4K increase)

Capital One Quicksilver, $10,000 CL, 2 mo

Discover It, $2000 CL, 2 mo

Citi Diamond Preferred, $500 CL, 2 mo

 

So what I'm doing now is using the Discover and Citi cards as my daily drivers, the BoA card handles all my recurring stuff (streaming services, cell phone bill, etc.), Chase is pretty much a sock drawer card, likewise I'm just putting a little bit on Cap1 to keep it active.

 

Currently I have <3% utilization even without optimizing anything just letting the charges happen and paying them off before the due date (as per previous posts at least Discovery likes activity so I'm letting it report utilization, doing the same with Citi just in case that helps too.)  The one derogatory on my credit report is a ~5.5 year old 90DL from Citi (which I'm sure is why their CL is so much lower than all the others.)

 

I did just recently (Friday) receive a small raise, so I can show that when asking for CLI but it was not a large one.  Don't really have any significant other sources of income; I cashed out some stock and also started a HYSA this year but that'll be minimal.  I expect my federal gross this year to be a little over $120K.

 

I do not expect any great increase in my credit scores between today and when I'll be able to apply for CLIs from these various cards.  I can't get my utilization down any lower, I only have one other open account which is an Affirm 0% loan for a cell phone that will be paid off in January and I guess that only reports to Experian anyway.  The whole point of getting these new cards and now angling for CLIs is for the purpose of improving my credit scores because it doesn't seem like there's much else I can do, save for waiting for the 90DL to age off which it will sometime in early 2025 (February?  January was when it was 30DL).  I have one hard pull from JMPC that will fall off in Sept. or Oct. (so before any proposed CLI requests) then obviously there's three on there now from July for applying to the new cards that won't fall off for another 2 years (I figured let's get all the cards now so those hard pulls will be old before I apply for a mortgage or other loan)

 

My plan is in another 4 months, for sure request a CLI from Citi and Discover as it appears I can do that without a hard pull, and those two really need CLIs to be useful, especially Citi.

 

What about Capital One?  should I request a CLI from them at the same time?  I have seen where they've actually been *reducing* people's credit lines so I'm not sure asking for more now would be advisable?

 

Chase?  worth asking?  According to the article they are not doing hard pulls anymore.  I did request one back in 2021 (over the phone) and it was a hard pull that is still showing on my report, but my scores were lower back then due to higher utilization (the whole reason I wanted the higher credit was to do a 0% transfer from my BoA card to pay it off faster) I am guessing if I do it should be 6 mos. or more from the auto-CLI?

 

BoA?  appears this also may be a soft pull?  that's by far my highest current CL, would I be getting greedy asking for more or just go for it?

 

I am assuming that the auto-CLIs that I got from BoA and JPMC are because I had taken a 0% BT a year earlier from JPMC to pay off my BoA card and then paid that off completely in February of this year, so my utilization suddenly went from significant to between $1-2k (whatever my monthly spending was)

 

Any opinions/advice would be appreciated.  Also if there's any info that I didn't provide that has a bearing on this please ask.

 

 

 

[hdporter]

My CLI "strategy" is among the simplest considerations by which I manage my credit. 

 

I target a CLI request once every 6 mo on the accounts for which I've shown reasonably active use.  For accounts which are dormant, other than the odd charge to show modest activity, I'll request annually.  I don't sweat incurring a credit inquiry in conjunction with a request, provided I have at least modest expectation for approval.

 

Because I have a couple of issuers where I hold multiple cards, where they've signaled in the past that they've extended the maximum credit that they're willing to allow, based upon my reported income, I largely refrain from CLI requests under the above schedule.  Instead, I will select a single card with such an issuer, that's been used actively, and request an annual CLI until successful.  (Once successful, I'll try CLI's more frequently from that issuer on multiple cards.)

 

I'm not as aggressive at pursuing large limits as some on this group (and I generally cap my cards at about $35k each, after which I don't request further CLI's).  I've grown my CL's from my "rebuild" in 2006, beginning with $12k in CL's, building to an aggregate of card limits that's roughly 3x-4x my reported annual income.  I have about 40 open cards.

[supern8ural]

Thanks for the reply.  I'm kind of late to the game on this, I really never put much thought into my credit scores until recently.  I figured I had all the credit I needed so why bother?  Now I see I probably should have applied for more cards 15-20 years ago because they'd really be helping me now, but that's water under the bridge.  I will definitely help any young person who asks however...

 

Like you, I really don't feel the need to have large limits, but what I don't want to do is tank my AAoA by applying for even more cards now.  But, some of them could use some increases.  Curious why the 35k cap?  Any particular rationale or is that just your personal comfort?  and yeah I'm obviously not even near my annual income in CL now.

 

I guess I'm really on the fence about asking for CLIs on BoA, Chase, and Capital One.  Is there any reason why I shouldn't?

[hdporter]

30 minutes ago, supern8ural said:

Thanks for the reply.  I'm kind of late to the game on this, I really never put much thought into my credit scores until recently.  I figured I had all the credit I needed so why bother?  Now I see I probably should have applied for more cards 15-20 years ago because they'd really be helping me now, but that's water under the bridge. 

 

Technically, there's no such thing as "late to the game".  It's all about where you are now and where you take yourself.

 

I blew out my credit at age 35-40, first with some less than wise spending and then an extended period of unemployment.  I was fortunate in that I was able to address the situation proactively and avoided collection accounts (and bankruptcy wasn't a necessary recourse).  But all but one of my accounts (Providian) and one of wife's (Bev's) were "nerfed" in the process with a hefty number of 90-day to 150-day delinquencies reporting.  I spent age 40-45 getting back on top of things and restored a 680 FICO.  That's 20 years ago.

 

38 minutes ago, supern8ural said:

Like you, I really don't feel the need to have large limits, but what I don't want to do is tank my AAoA by applying for even more cards now.  But, some of them could use some increases.  Curious why the 35k cap?  Any particular rationale or is that just your personal comfort?  and yeah I'm obviously not even near my annual income in CL now.

 

I guess I'm really on the fence about asking for CLIs on BoA, Chase, and Capital One.  Is there any reason why I shouldn't?

 

Two reasons on the CL cap:

 

-- First, I came through the 2008 credit debacle relatively unscathed (although BA sent the reaper after my lines when I asked for an online CLI  on an  account and received the suggestion that I could call for consideration.   (That experience seemed on par with seeing a nurse to examine an- ingrown hair on my rear and suddenly finding myself strapped down for a colonoscopy.)

 

Those were some fun times!   What I came away with was that large credit lines that see only nominal use relative to their limits can draw unwanted scrutiny in the right circumstances.  Because my monthly use of any given card is capped at about $3500, I figure a $35k CL will do me just fine in most all circumstances (I've never been wanting for more).

 

-- Second, over time it came to light that FICO 8 distinguishes between credit lines under approx $35k - $40k (varies by CRA) and those over that limit when it comes to inclusion in the calculation of account utilization.  The facts around this have been fuzzy (no actual guidance published from FICO), but actual reporting and credit ratio experience have borne this out.  Low aggregate utilization scores favorably and I target 1%-2% credit utilization (occasionally I climb to 5%-6%).  For this reason, I desire that every revolver is factored into utilization and so have targeted a corresponding cap.

 

-------

 

As far as requesting CLI's of any issuer:  Setting aside my BA aberration, the worse outcome from requesting a CLI from an issuer is a hard CRA pull.  As I've expressed, I don't sweat CLI's, but prefer that they incurred in the quest for feasible credit goals.  So, if denied or given some other indication that I'm not in a favorable position for CLI consideration, I back off for awhile.  That's about the only leash I put on my CLI requests.  In short, in answer to your specific question, unless you're aware of a specific reason to be CLI request shy with an issuer, I'd go for it.

 

 

 

 

[supern8ural]

3 hours ago, hdporter said:

-- Second, over time it came to light that FICO 8 distinguishes between credit lines under approx $35k - $40k (varies by CRA) and those over that limit when it comes to inclusion in the calculation of account utilization.  The facts around this have been fuzzy (no actual guidance published from FICO), but actual reporting and credit ratio experience have borne this out.  Low aggregate utilization scores favorably and I target 1%-2% credit utilization (occasionally I climb to 5%-6%).  For this reason, I desire that every revolver is factored into utilization and so have targeted a corresponding cap.

 

is there somewhere I could read up on this?  DAGS for "FICO 8 high limit cards" mostly spits out links for "best credit cards with high limits" and the like.  Really would love to understand more about this stuff so I can make good decisions.

[hdporter]

33 minutes ago, supern8ural said:

 

is there somewhere I could read up on this?  DAGS for "FICO 8 high limit cards" mostly spits out links for "best credit cards with high limits" and the like.  Really would love to understand more about this stuff so I can make good decisions.

 

This is only sporadically discussed.  FICO has issued no related guidance whatsoever, keeping details of their algorithm close to the vest (consistent with their general policies).

 

The background is the following:  Originally, all accounts with a type "revolving" tended to be credit card accounts (and accounts of similar ilk).  There were a much smaller number of revolving credit lines, but the characteristics of their user management of the accounts were similar enough to other revolving accounts that their presence didn't distort the overall revolving credit picture for FICO analysis.

 

Then, home equity (revolving) lines of credit entered into the picture.  Accounts holders tended to draw against a higher percentage of the credit limit on these accounts and to repay balances over a longer period of time.  As these accounts grew in number, the merge of these accounts in with other revolving accounts skewed risk modelling of revolving accounts overall.  Many of the accounts carried no separate descriptor from which you could segregate them from standard credit card accounts, except that their limits tended to run much higher.

 

So a fix was put into place in the FICO algorithm to arbitrarily segregate out high credit limit revolving accounts and exclude these accounts from the calculation of revolving utilization.  Both CL and monthly payment were ignored in calculating over all revolving credit utilization.  The CL division used for this was apparently left up to the CRA's,, but is within a range of something like $30k-$40k.

 

This has been discussed fairly sparingly here on CB, as well as on the myFICO credit forums.   I stumbled over this impact a number of years ago when reviewing my credit scoring reports from myFICO, where the reported credit utilization ratios didn't jive with any of my reported data.  (I have typically relied moderately heavily on promotional rate balance transfers to manage purchase financing and carried balances, so such discrepancies were more notable then otherwise might be the case.)

[shifter]

1 hour ago, supern8ural said:

 

is there somewhere I could read up on this?  DAGS for "FICO 8 high limit cards" mostly spits out links for "best credit cards with high limits" and the like.  Really would love to understand more about this stuff so I can make good decisions.

This is the last thing I would worry about at this point in your credit journey. HD is the most conservative person I've ever encountered about credit. But he's earned that right to do what he wishes based on his many years of credit management.

 

However, no one I've talked to including people who have forgotten more about credit than I will ever know have worried about CLs that are too large. Personally I believe in the bigger the better and most everyone I know agrees. If anything it's good to have $50k+ CLs because their util won't hurt you if you have a large expense and run a $30k balance for a month or whatever. The only real potential harm is you can't do the $2 trick with a $50k CL because it will ding you like you have zero balances. 

 

As far as $35k, even that is ultra conservative as I believe enough testing has been done to nail down the precise limit above $42k but below $48k. So it's somewhere in there but nowhere near $35k. 

Edited September 20 by shifter

[hdporter]

4 hours ago, shifter said:

HD is the most conservative person I've ever encountered about credit. But he's earned that right to do what he wishes based on his many years of credit management.

 

Something to which I fully fess up ... honed by a career surrounded by far more fiscally conservative souls in corporate finance.  (You wouldn't believe some of my stories!)

 

(That's not to say that I'm "rigid" ... there's flexibility in all the right places; I've rarely put myself at a disadvantage, or forfeited a significant financial opportunity, out of that conservative nature)

 

[supern8ural]

Thank you both for your thoughts.  I guess the only real consideration that somewhat argues against "CLI everything" is that I am trying to avoid hard pulls as I am perhaps optimistic in that I am thinking that maybe in the next 12-18 months I'll have enough savings and more importantly interest rates will have come down enough that I really can buy a house.  We shall see.

 

I never thought about the HELOC thing.  I really wish I'd been tracking my scores years ago when I had a mortgage and HELOC...  (of course, the scoring methods were probably different then.)

 

So if I'm understanding everything here correctly, I may not want to CLI BoA because it's over $30K but that's debatable, and everything else is fair game...?

Edited September 20 by supern8ural

[supern8ural]

Well they got me LOL.  Went to Macy's to look at a watch I was interested in - a specific Seiko model that retails for $475.  Just gonna look.

 

Turns out it was $25% off through Sunday and I got a shiny new Macy's AmEx and another 25% off purchases through Sunday.

 

I really like my new watch

[supern8ural]

OK this is weird...  Citi gave me a $500 limit on a Diamond Preferred but $2K on a Macy's AmEx *AFTER* all the pulls hit?  Make this make sense.

[brainchasm]

Re: worrying about CLIs and hard pulls and who does what...

Just freeze your reports, then ask everyone for a CLI via phone.

 

The ones than can, will.  The ones that want a hard pull for a CLI, won't.  When they say oops, your stuff is frozen, you can just ask them, oh, which one do I need to unfreeze?  and they'll either tell you the specific one(s), or they'll say they're not sure, how about just all of them.  With that info, you can check the creditpulls database to inform your decision, and then you can make the call as to whether to unfreeze and ask again, or defer.
 

I'm in a somewhat similar boat as hdporter at this point; had trash credit because of dumb young(er) stuff, realized it was actually important, came here, learned everything, and then went to war.  That was 2009/2010 I think.  Now I'm rolling a couple dozen cards, a half dozen car notes (all closed but one), a few multiples of my annual income in limits, etc.

I've scored LOCs, a hidden tradeline, a few high-limit cards, and the game is largely over for me.  It's just gardening now.

Slow and steady, make bold moves, and be smarter than the system.  That's all it takes.

 

[shifter]

2 hours ago, brainchasm said:

Just freeze your reports, then ask everyone for a CLI via phone.

Not a bad idea to freeze reports, but you can also do this and request a CLI online. 

[chrishillson]

That $500 Citi is worrying, Ask Discover, Cap1, and Citi for a limit increase online once they hit 6 months + 1 day. No hard pull and you get what they give you. They might give you some feedback and you can act appropriately and try again in 6 months.

 

Based on your results you can gauge when it would be prudent to push BoA for more and take a hard pull with Chase. Or just open a new Chase, get the bonus, and combine limits...

[supern8ural]

That's the plan, and I don't like the $500 Citi limit either but I think I know why it happened.  Back in early 2018 I had a small balance on my Citi card but wasn't using it, I had minimum payments set up to auto pay (I'd have paid it off but I was going through a very hard time then and couldn't, and was dealing with some other stuff) well SiriusXM auto-renewed on that card and I didn't realize it until it'd gone 90DL and Citi had closed it.  I was still making payments, but the minimum payment increased above what I was auto-paying so it snowballed.  So that's why they don't like me, compared to other issuers.  What that also means is that I won't have a truly good credit rating until 2025 (I did try a GW letter and failed) so I figured in the meantime I'll go ahead and take the hits to get some new cards to hopefully build up my credit by then as I hope that by then I'll have enough savings and interest rates will have started coming down enough that I can consider buying a house.  All the hard pulls won't have quite fallen off by then but my understanding is they don't matter as much after a year, so I figure better to set myself up for the long term now and get it over with.

 

The whole situation is very frustrating as that old Citi card was myoldest card and also had a decently high CL, I think somewhere above $15K.  I really can only blame myself though for not at least logging in once a month and now I have my google calendar populated with all the statement dates and due dates for all my cards so I do just that.  I also can tell myself I'm lucky to be out of that period of my life with only one 90DL reporting and be otherwise unscathed...

 

I'm definitely going to request a CLI from the three you mention, it's frustrating sitting and waiting though do you think it's worth asking Chase as well?  I don't know how reliable this info is but according to this link I found it appears they're no longer hard pulling for CLI requests.  https://www.doctorofcredit.com/chase-allowing-credit-limit-increases-via-app-without-hard-credit-pull/

[hdporter]

1 hour ago, supern8ural said:

  I really can only blame myself though for not at least logging in once a month and now I have my google calendar populated with all the statement dates and due dates for all my cards so I do just that.  I also can tell myself I'm lucky to be out of that period of my life with only one 90DL reporting and be otherwise unscathed...

 

Time heals.  You're well on the way to having a clean report; a huge reason to take comfort.

 

Your situation points to why I insist on killing a small tree each year and have statements mailed to me.  Receipt of a statement hits me squarely between the eyes and I ensure that I have an appropriate payment scheduled upon receipt. 

 

Technically, the same could be accomplished by email, but that involves far too much competing "static".  I typically receive 5-20 USPS mail pieces daily; my inbox sees a daily volume of 50-100+.  I periodically hit my inbox to scan back a week for emails that were "missed" in the clutter.

 

(I'm astounded that AOL Mail has retained over 500k individual emails for me, at no added cost, going back to 2015.  It's nice for when I'm feeling "nostalgic" ... or just feel like dredging up a little history )

[brainchasm]

18 hours ago, shifter said:

Not a bad idea to freeze reports, but you can also do this and request a CLI online. 

True, but you glean less info with an online request than a phone one.  CSRs will tell you (often) why your request didn't work; I think I've seen one online request that said "nope, and this is why...".  They typically just go black-box and say they'll send a letter IME.

 

[supern8ural]

My apologies if this is a dumb n00b question, but if I freeze my reports, I am gathering from the above that that will stop hard pulls but not soft ones?

 

That may be something I want to do if that is the case.

[brainchasm]

39 minutes ago, supern8ural said:

My apologies if this is a dumb n00b question, but if I freeze my reports, I am gathering from the above that that will stop hard pulls but not soft ones?

 

That may be something I want to do if that is the case.

Correct.

[eta] It may also stop actual "softs", but if they pull from their own internal info (ex. AMEX), they'll do whatever they're going to do.

 

 

Edited September 26 by brainchasm

[supern8ural]

Well now it's scary time... the last new card just hit my credit reports.  For example, my Experian FICO 8 was 733-734 April through July this year which was after I'd paid off all my debt but hadn't started applying for any new cards yet.  Now it's 719 (eep!) all because of new cards, as my utilization is still low single digits and nothing else has changed.  VantageScore 3.0 is even worse, 768 to 722.  Yes I know FICO is what matters, but that's depressing to see (also Experian.  My TU scores are even lower...)  Will my cunning plan result in an even higher score a year from now?  we will see...

 

I did a pretty good job this past month managing my purchases on the two cards I'm angling for CLIs most on however.  Both are sitting right about 50% utilization at the moment...  (to get more than that I would either have to spend more than I normally would or else carry a balance, which I could do as I think both cards have 0% APR for a year or more)

 

Somewhat unrelated to the topic at hand, but my new Macy's AmEx kicked out a statement Wednesday.  I just opened the account last Friday evening, and I haven't even received the card yet.  Good thing I'm on top of my stuff!  Already have the statement and due dates plugged into my calendar, although I haven't actually set up a payment as I don't have my full account number yet.  I am not complaining however as while this might be seen as a little evil (it does have a predatory APR of 31.99% and now that radically shrinks my grace period) it actually helps me with my main goal which is to build payment history, available credit, and number of tradelines specifically to ultimately improve my credit scores above what they'd be had I done nothing.  Also, they did apply a credit of almost $100 so I did come home with a MSRP $475 watch (that I did legitimately have interest in, this wasn't a complete impulse purchase) for ~$280.  Now I have an attractive GMT watch that I'm not paranoid about wearing like I am my vintage Zodiac.  Good deal.

 

I guess there's not much more I can do except keep managing my spending to show usage and... wait.  Driving me nuts, it is.  Anyone else get restless and feel the need to DO SOMETHING when time is really the only thing that's going to help you toward your goals?

[hegemony]

On 9/26/2023 at 2:15 PM, supern8ural said:

My apologies if this is a dumb n00b question, but if I freeze my reports, I am gathering from the above that that will stop hard pulls but not soft ones?

 

That may be something I want to do if that is the case.

freezing doesn't stop current creditors from obtaining a report regardless of whether it is "soft" or "hard." freezing also will cause your file to be opted out, which can shut down options via pre-screened offers.

 

inquiries do not really matter. don't overthink the impact of "hard" inquiries. FWIW any new account will hurt a lot more than its inqs.

[supern8ural]

35 minutes ago, hegemony said:

freezing doesn't stop current creditors from obtaining a report regardless of whether it is "soft" or "hard." freezing also will cause your file to be opted out, which can shut down options via pre-screened offers.

 

inquiries do not really matter. don't overthink the impact of "hard" inquiries. FWIW any new account will hurt a lot more than its inqs.

 

I'm not actively looking to add any more accounts at this time, because that would absolutely tank my AAoA, as right now it's already sub optimal.  At this point it's just gonna be whatever fine tuning I can do until probably February 2025 when my one derogatory falls off and my AAoA won't be quite so bad either.  I'm really, really hoping that at that point I'll see a nice bump in my scores.  I figure trying to get CLIs so all the cards that I currently have are useful (a $500 CL is barely useful even as an emergency use card...) is a good thing to do in the meantime, but as (as of next month) I'll have four hard pulls on my account I'm also trying to stay clear of things like hard 5/24 rules.

[supern8ural]

...and my Experian FICO 8 just went up 9 points overnight for no apparent reason...?  Somehow I managed to get 4 new cards, tank my AAoA, and I'm still only 6 points below what I was back in May?  Literally nothing else has changed other than my derogs are a couple months older.  No wonder people get confused by/obsess over this stuff.

 

I was expecting my actions to hurt short term/help long term but maybe I'll turn the corner sooner than I was expecting?

Edited October 2 by supern8ural

[MarvBear]

I believe in the absence of derogatory information; one can expect their FICO® score to go up ever so slightly after the 1st of the month.  Simply an age-related facet of the calculations that determine a score.