Increasing the credit limit would not only increase the amount of funds available to you, but also increase your credit score. If your credit score is down, increasing the spending limit on your credit card is one of the simplest ways to add a few points to your credit score. Any user can request for a credit limit extension after six months of using the credit card.
Increase by the issuer
The issuer increases the credit limit of the customer by analyzing whether the customer deserves one or not. In such cases, the spending limit would be increased, without any notice. This is very common in accounts with very low limit. As the limit gets higher, the frequency of automatic increase would decrease.
Request online or through phone
You can negotiate an increase as well. However, frequent requisition would lead to credit inquiry which might reduce your credit score, sometimes. Some companies allow the customer to increase the limit through online means. They ask you, your desired limit and calculate the risk associated with you, as a customer. They would provide a limit based on their analysis. The request can be made through phone as well. No matter which method is used, the increase would be immediate, if your financial report shows you as a less risk factor.
Card limit transfer
When a customer uses more than one credit cards, he can transfer the credit limit from one card to another. This can be done only when the cards are issued by the same company.
Though the increase in the credit limit would give a hike to your credit score, there are certain disadvantages associated with it. The first disadvantage is that the hard push for an increase in the credit limit would push your credit score down, temporarily.
When you are opting for the card limit transfer, there are two reasons for a dip in the credit score. When the customer gets another credit card, there would be a decrease in the credit score and when the new card is closed, the credit score is decreased, considerably.
Though, it is important to know that the automatic increase is the best and simplest way. You can request it, once, but, should not push the issuer to increase his limit. Negotiation does not help you in this context. One should ask for the increase when the credit is stronger, when your income has increased, when you are travelling and when you are less likely to default a payment.