I have a Discover card with a limit of around $2000 ("Discover It"), which is very low. As a result, I end up putting my biggest purchases on debit, or use an alternative form of payment (eg. money order, bank transfer, ACH, etc.) I don't like doing this, so I applied for a higher line of credit but was denied. The reason quoted to me was that my utilization rate was too low.
Indeed, while I put all of my recurring bills (water, electricity, etc.) on credit card, and also my routine grocery/gas purchases, my credit utilization is only about 10%. I live rather frugally and well within my means. I've paid off my loans, including student debt and my mortgage.
Since I had some larger purchases I needed to make, but still under the limit, I put them on the Discover card. (Plane tickets, concert tickets, etc.) My credit utilization went up to 33% (ish), and my credit score promptly dropped 47 points. Now my application for a higher line of credit was denied because of a too-low credit score. (725 still seems pretty good to me, but I don't run a credit card company.)
It seems like I'm in a catch-22. When I increase my credit utilization so that I can apply for a larger line of credit, my credit score drops and I get denied for a too-low score. When I decrease my utilization and let my score climb back up, I get denied for too low utilization. (I've been experimenting for the past few months with this, varying how much I stick on the CC and how much I pay via debit/other methods. My HOA fees, for example, are a large recurring payment that I can pay via multiple methods so I can put various percentages of the fees onto the CC. ...)
How can I get a higher line of credit from Discover by increasing my utilization, but without negatively affecting my credit score? I make over $150,000, not including bonuses, and have a stable job, so these teensy little credit limits are driving me somewhat insane. I only have two credit cards for a combined total limit of $4200.