I have been reading recently about how credit scores are calculated, and it seems that the ratio of available credit to used credit (ie, debt) plays a large role.

I am curious how a charge card with no limit (such as those offered by American Express) affect your credit score. Now, these cards I am talking about are charge cards, rather than credit cards, so they must be paid off in full each month, but if I suddenly became irresponsible with my AmEx card, I could easily end up buying more stuff than I could afford, so I imagine that this should factor into my credit score.

  • 1
    There's no preset limit.
    – James
    Commented Aug 31, 2010 at 19:35
  • Right, I actually mentioned that originally in the title of the question, but then @George Marian edited it. So, I assume that there is a non-specific 'reasonable' limit. How would such a non-preset limit factor into the credit rating caclulation?
    – pkaeding
    Commented Aug 31, 2010 at 20:17
  • 1
    Also look at this question on high limit cards: money.stackexchange.com/questions/2565/…
    – SpecKK
    Commented Aug 31, 2010 at 21:16

1 Answer 1


Apparently it is up to the credit card company on how they want to report your available balance.

Another disadvantage to the no-limit credit card may not be apparent to most people, but it is something noted by organizations like The Motley Fool, which is expert in many issues of finance and investment. Part of your credit score, about 30%, considers the amount of money you have borrowed, and the limit on your present credit cards. A no-limit credit card company may report your limit as $0 if you have not used the card, or they may report a maximum limit available to you. They may not, nor are they obligated, to report times when you put tons of expenses on a credit card and then paid them off.

While some companies will report your timely payments and paid off amounts, others simply report an extremely low limit. For instance if you spent $100 US Dollars (USD), your limit might be considered $100 USD, or it may merely be reported as zero. You’ll need to check with a credit card company on how they report payments and limits on a no-limit credit card before you obtain one. Some people who are scrupulous are paying off their cards at the end of each month suffer major losses to their credit score, without even realizing it, if their spending ability is rated at zero, or their payments don’t count toward showing credit worthiness.


  • 1
    Capital One was notorious for reporting as your limit the maximum amount you had ever charged up in a single month. Some were advising to charge up to the max the first month to get around this, but the better advise is probably just to avoid getting Capital One credit cards.
    – JohnFx
    Commented Sep 2, 2010 at 18:22
  • 1
    I'm pretty sure Amex understands how credit scoring works and wants your business. This seems like a ridiculous approach that should be resolvable with a phone call. That is, if you were dealing with intelligent life...
    – SpecKK
    Commented Sep 2, 2010 at 19:32

You must log in to answer this question.

Not the answer you're looking for? Browse other questions tagged .