by Elizabeth Aldrich | Updated July 21, 2021 - First published on Jan. 14, 2019
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Capital One has some rules when it comes to credit limit increases -- make sure you know them before you request one. Image source: Getty Images.
Increasing the credit limit on your Capital One credit card can be a great way to add more flexibility to your budget and possibly increase your score. Capital One does allow credit limit increases, but only to eligible cardholders. Luckily, even folks with an average credit score may qualify for a high credit limit.
Find out whether or not you're eligible for a credit limit increase with Capital One, how often you can request a credit limit increase, and how it will affect your credit score.
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Increasing your credit limit or getting a good high limit credit card can be a good way to increase your credit score, but it doesn't always work that way. There are two factors at play here: your debt-to-credit ratio, and your recent inquiries.
Your debt-to-credit ratio, also known as your credit utilization rate, is the ratio of debt you have to your available credit. This is calculated across all accounts and on each individual account. If you have a balance of $3,000 across all of your credit cards and a total available credit (the credit limits of all your credit cards added up) of $10,000, your credit utilization rate is 30%. This is a good credit utilization rate.
This number is a major factor in calculating your "Amounts Owed," which makes up 30% of your FICO Score®. The general rule of thumb is to keep this number below 30%, although there are no official published guidelines. We do know that a lower credit utilization rate is always better. Keep in mind that this number is updated continually, so if you tend to bump up against your credit limit each month, using all of your available credit could still be hurting your score even if you pay off your balance in full each month.
"New Credit" is a category that makes up 10% of your FICO Score®, and a major factor in calculating this number is the amount of recent inquiries you have on your account. Each time a lender pulls your credit report, it results in an inquiry. If it's a soft inquiry, it won't affect your credit score. If it's a hard inquiry, it will show up on your credit history and could decrease your score slightly and temporarily. Some lenders process credit limit increase requests as a soft inquiry and some process them as a hard inquiry. One or two hard inquiries won't make a noticeable dent, but having a lot in the past year can hurt your credit score.
Overall, requesting too many credit limit increases in a short period of time can drag down your score, and if you're denied, it will do nothing to help your score. However, if you're approved for a credit limit increase, your credit utilization rate will decrease, which will likely more than offset any dip caused by an inquiry. The takeaway here is that requesting a credit limit increase can boost your credit score, but it's important to make sure you're eligible before applying in order to minimize the chances of a rejection.
Given the information above about how a credit limit increase can affect your credit score, you should only request to have your credit limit increased if you meet the following circumstances:
If your credit utilization rate stays below 10% each month, there isn't much reason to request a credit limit increase. However, if you plan to close a credit card in the near future, you might want to request a credit limit increase on a credit card you plan to leave open in order to offset the available credit you'll lose by closing a card.
Now that you understand how credit limit increases affect your credit score and when you should request one, it's time to get into the details of how credit limit increases work with Capital One.
Capital One lets you request a credit limit increase online as often as you want, but you can only be approved once every six months. If you've received a credit limit increase or a credit limit decrease in the last six months, you won't be approved for a credit limit increase.
Additionally, if your account is less than three months old, you won't qualify for a credit limit increase. Even if your account is older than three months, you still might be denied for having a new account. People with accounts that are at least 12 months old have the best chance at receiving approval.
The good news is requests for a credit limit increase with Capital One are processed as a soft inquiry, meaning they won't damage your credit score.
In order to qualify for a credit limit increase with Capital One, your account needs to meet the following requirements:
Of course, meeting these qualification requirements doesn't guarantee that you'll be approved for a credit limit increase. Here are the factors that Capital One considers when deciding whether or not to grant you a credit limit increase.
They will likely also consider your disposable income and employment status in relation to the amount of credit you have available. Banks don't like to extend more credit to you than they think you can handle.
According to Capital One, there are a number of steps you can take to increase your chances of approval for a higher credit line in the future. Of course, even if you follow all of these steps, you are never guaranteed to receive approval.
The process of requesting a credit limit increase with Capital One is quick and easy, and everything can be done completely online. The following steps explain the process.
You may receive an immediate decision, but more than likely, you'll be sent to a "Request Received" page. You'll get a decision within two to three business days if you have a paperless account or 10 days by mail.
If you'd prefer to call Capital One and request a credit limit increase that way, you can give them a call at 1-800-955-7070. You'll be able to submit your request through an automated response, so you don't have to speak to a customer service representative.
Remember that while increasing your credit line can help your credit score, having more available credit can also do serious damage to your credit score if you don't use it responsibly. Maintaining an excellent credit score will help you qualify for some of the best credit cards on the market. Make sure you always make on-time monthly payments and pay off your balance in full whenever possible to avoid interest charges.
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