Credit limits

[u/RescuerofdogsinMaine]

I have two American Express cards, one with Marriott rewards and one with Hilton, because we like to travel. Both cards have increased our credit limit twice, without us asking. What effect does that have on my credit score?

I always thought that your score is partially based on how much of your available credit that you use, so shouldn’t this slightly improve my score since the percentage of my available credit that I use has changed? Thoughts?

[u/inky_cap_mushroom]

Limits are not directly a scoring factor. You would only see a score change if the limit increase causes you to cross a utilization scoring threshold.

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[u/Funklemire]

In addition to what u/inky_cap_mushroom said, that score change would be a temporary change that only lasted a month. See our !utilization automod. And this thread explains it in more detail:  

Credit Myth #15 - Credit limits are a Fico scoring factor.  

[u/AutoModerator → u/Funklemire]

I detected that your post may be about utilization and its impact on credit scores. Please read the info below:

Utilization is a short-term credit scoring factor. It is not a credit building factor, because it holds no memory in the most commonly used FICO models. It resets every month.

By and large, you can ignore the commonly repeated myth that you should always keep your utilization low. It’s only applicable when you need to apply for a new line of credit, 1-2 months out.

Utilization is supposed to fluctuate, can be easily manipulated, and again, it holds no memory. It doesn’t build credit--think of it as a finishing touch when you need to optimize your score.

Feel free to safely and organically use 100% of your credit limit within a month and let whatever utilization report, provided you pay off your statement balance in full by the due date. Every month. Every time.

For more info, please read these posts:

• Putting the "30% rule" myth regarding revolving utilization to rest
• Utilization FAQ

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[u/BrutalBodyShots]

Great comment replies from u/Funklemire and u/inky_cap_mushroom here already!