Requesting a credit limit increase is an excellent way to free up available credit for a large purchase, but it can also provide a boost to your credit score. This is due to the fact that the amounts you owe in relation to your credit limit — also known as your credit utilization — makes up 30 percent of your FICO credit score. Thus, a higher credit limit could lower your credit utilization without requiring you to pay down a large percentage of your debt.
If you have an American Express credit card, you may be wondering how to apply for a credit limit increase or whether you’re even eligible. This guide covers the ins and outs of an Amex credit limit increase and how you can ask for one.
Before you apply for a credit increase
There are a few issues to think over before you apply for a credit limit increase on a credit card you already have. Here are the main factors to keep in mind:
What is your current credit limit?
Check your Amex credit card account details to find out what your current credit limit is. If you’re not sure how to find this information, you can do so by logging into your online account management page on AmericanExpress.com, or by checking your paper credit card statement.
How much credit do you want?
Think about how much available credit you might want to ask for. Also, keep in mind that asking for too much additional credit could get you denied. American Express actually suggests asking for an increase of just 10 to 25 percent of your current limit for the best results.
Are you eligible for an increase?
Take stock of your personal situation to decide if you would even be eligible for a higher line of credit than you have now. To qualify for an Amex credit limit increase, your credit card account has to have been open for at least 60 days. You also need a good credit score and a positive history of employment and income to qualify.
Are you worried about having a new hard inquiry on your credit report?
Asking for a credit limit increase usually results in a new hard inquiry on your credit report, which could temporarily impact your credit score in a negative way. It’s also possible you’ll only have a credit limit increase soft pull, however, since American Express is known for not using a hard inquiry as a result of credit limit inquiries. Either way, this is another factor you should keep in mind.
3 ways to increase your credit limit with American Express
Here are a few different ways you could potentially access more available credit with American Express, either with the card you have or a new American Express credit card.
Request a credit limit increase
Most of the time, the best way to secure a credit limit increase is to ask for one. With American Express, you can request a credit limit increase by calling into American Express customer service or through your online account management page.
Wait it out
You can also wait to see if your credit limit will increase automatically over time. Generally speaking, most card issuers will consider increasing your limit once you have exhibited a certain level of responsible credit use, such as paying your credit card bill early or on time for six or 12 months.
Apply for a new Amex credit card
If you want more credit from American Express, you can also simply apply for another American Express credit card. This option can help you secure credit for a large purchase, but you might also be able to earn a generous welcome bonus and ongoing rewards for your spending.
How long does an American Express credit line increase take?
If you qualify for a credit limit increase from American Express, you may see this increase reflected in your account right away. You can find out if your increase went through by logging into your online account management page and checking whether your credit limit has been boosted to reflect the change or not.
What to do if your Amex request is denied
If your Amex credit limit increase is denied, don’t fall into despair. There are steps you can take to put yourself in a better position to qualify for a credit limit increase down the line.
Pay all your bills on time
Your payment history makes up 35 percent of your FICO credit score, so you’ll want to make sure you pay all your bills early or on time. By making sure your credit profile is pristine and free of late payments, you can set yourself up for better credit over time.
Pay down debt
Since your credit utilization makes up another 30 percent of your FICO score, paying down debt on revolving lines of credit is an excellent way to boost your credit score. American Express may also be more willing to increase your available credit when you owe less overall. Note: You should strive to keep your credit utilization below 30 percent.
Check your credit reports for errors
Be sure to check your credit reports for reporting errors. You can do so with all three credit bureaus — Experian, Equifax and TransUnion — for free using the website AnnualCreditReport.com.
If you do find reporting errors or mistakes on any of your reports, Bankrate’s guide to disputing errors on your credit reports outlines your next best steps.