Applying for credit cards with a low credit limit
When credit limits are discussed, it is usually within the realm of having the limit increased. Rarely do you hear that someone wants to have their credit limit decreased. You may wonder, ‘Why would anyone want to have his or her credit limit decreased?’ Well, this may be for a variety of reasons.
Self-Imposed Credit Limits
As the Ancient Greek aphorism describes, ‘Know Thyself.’ This is important when you are trying to make changes in your financial well-being. If you have a history of spending beyond what you are capable of repaying then lowering your credit limit would make it impossible for you to spend more than your self-imposed amount.
People may choose to do this in small ways. Lowering your credit limit is one way to get started on making changes in a positive direction. This can also force you to be less dependent on your credit card.
Obligation to a Loved One or Friend
Everyone needs bailing out at one point or another. If someone has bailed out a friend financially, however, there may have been conditions placed on the help. One of them may have been to change some limits on spending or getting rid of your credit card in order to receive the financial assistance that was needed at the time.
Low Credit Limit Credit Cards
Improving One’s Credit Score
This may not be common knowledge, but you can improve your credit score by lowering your credit limits. If you have many high balances on your credit cards then it is worth your time to consider lowering your credit limits in order to gain a higher credit score. In fact, many who have high balances choose to have a low credit limit to obtain better marks on their credit record.
How to Lower Your Limit
In order for you to decrease your credit limit, you will need to contact your credit card provider personally. Many providers offer options of modifying your credit card details online but this is usually for increases only.
Because of the rarity of the request, you may need to ask immediately to a manager to handle the transaction. There is not typically a procedure to handle this type of request.
A word of caution should be heeded, as well. If you are lowering your limit, you should be careful not to decrease it below your balance. Doing so could result in penalty charges which would negate the reason for lowering it in the first place.