[trippin_the_rift]

I'm thinking of borrowing a few bucks for a new home but one of the questions that I've noticed come in lately is "your total credit card limits".

My true credit limits is insane and would significantly affect borrowing power.... how does everyone else get around this?

[NM]

I handle it by not having more available credit than I need. I refuse the regular offers by my current CC proviers for limit increases because I have no intention of ever using credit cards for those levels of debt.

If its going to cause you problems with a loan, then cancel some of the high limit cards, or ask the provider about reducing the limits. They will be reluctant to reduce your limits since they want to lock you in to use them for credit, which is why they give such large credit limits in the first place.

Citibank tried to increase my Redicredit account credit limit by $10,000 last week. That is just rediculous since in the few years I have had the account I have never been more than about $500 in credit and that was only for less than a day. I use it as a free cheque account and in the past for overseas ATM withdrawals and transfer the fund into the account the same or following day. So what possible valu is there for my available credit limit to be increased to well over $30,000? None whatsoever. But there is every incentive for Citibank to get me to do it. I very nearly called them and said "thanks for prompting me about the value of my credit limit. Instead of increasing it by $10,000, please reduce it by that same amount. Oh and each time you ask me to increase it, I will call back and ask for a similar decrease until I am happy that the limit reflects the quality of the service".

[Shano]

My credit limit probably isn't anywhere near as high as yours, but I was also a little concerened about this when applying for a loan.

I took out my loan through a mortgage broker. When filling in the CC section on the loan application I explained to the broker that my two high limit cards (~$30,000 each) were cards that I used exclusively for business expenses and were re-imbursed in full each month by my employer (my employer does not issue corporate credit cards). The broker recommended that I leave these cards off the application which was never questioned by the bank.

I should add that I rarely get close to 50% of these limits, which makes me ponder NM's approach

I have another card with limit less than $10,000 that I use for personal expenses. This is more than enough for my personal purchases.

[simongr]

How do they account for things like a Amex Gold Charge card? It has no limit - do I just put 0 down for that?

[Shano]

Originally Posted by simongr

How do they account for things like a Amex Gold Charge card? It has no limit - do I just put 0 down for that?

My mortgage broker was happy for me to leave my Diners off the application as well.

[JohnK]

I am not sure whether the lender would check/verify every detail you have provided. I guess they would expect you to be honest, and in the majority of cases they would be only interested in proof of income or investments.

I have not applied for a loan for a few years now but I have been known to forget the occassional credit card or two on a loan application.

[trippin_the_rift]

Originally Posted by Shano

My credit limit probably isn't anywhere near as high as yours, but I was also a little concerened about this when applying for a loan.

I took out my loan through a mortgage broker. When filling in the CC section on the loan application I explained to the broker that my two high limit cards (~$30,000 each) were cards that I used exclusively for business expenses and were re-imbursed in full each month by my employer (my employer does not issue corporate credit cards). The broker recommended that I leave these cards off the application which was never questioned by the bank.

I should add that I rarely get close to 50% of these limits, which makes me ponder NM's approach

I have another card with limit less than $10,000 that I use for personal expenses. This is more than enough for my personal purchases.

This approach makes sense!

I have also heard of ANZ reopening customers accounts after they close them (for free) just incase it was a mistake.

[nagelixin]

The only way that a bank can find out your credit card limits is;

a) you bank with them
b) they ask for evidence, such as statements to verfiy your limits etc.


Your baycorp file will usually not mention how much you were given for the initial limit on your credit card, or any future increases.

[NM]

Originally Posted by nagelixin

The only way that a bank can find out your credit card limits is;

a) you bank with them
b) they ask for evidence, such as statements to verfiy your limits etc.


Your baycorp file will usually not mention how much you were given for the initial limit on your credit card, or any future increases.

Just be aware that providing incorrect information on the application form may leave you in a sticky legal situation at a later time. They may not be able to find out now, but if you default and they looking for you through the court system you could be in trouble if they find your signed declaration is incorrect.

[Sheriff]

I'm thinking of borrowing a few bucks for a new home but one of the questions that I've noticed come in lately is "your total credit card limits".

My true credit limits is insane and would significantly affect borrowing power.... how does everyone else get around this?

Your putting to much emphasis on credit limits.

I have been asked this question often, have always answered truthfully and found it has never affected my borrowiing power.

Income and liabilities are what matter when applying for a loan. These will definitely affect your borrowing power.

From a bank's point of view your income and liabilities are what will ultimately determine your ability to service a loan.

Cheers
Sheriff