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If I’m eligible for a line of credit increase request on my credit card, request one, but am declined one, does it hurt my credit score? If it can hurt my credit score, is it situational or does it happen in pretty much every instance?

EDIT: eligible as in I meet the criteria to make a request (ex. been 6 months since last line of credit increase). Edited question to reflect this

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    I doubt it, but even if it does, its minimal. Pay your bills on time, don't borrow too much money and you'll be fine. That affects your credit much more than this type of decision. If you don't want the increase for some reason, then decline it - if you do want it then accept it. – D Stanley Jul 5 '17 at 14:14
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    If you're eligible why would you be declined? What makes you think you're "eligible?" – quid Jul 5 '17 at 14:18
  • I believe the OP is confusing being offered an opportunity to ask for an increase as actually being qualified for it, which I see has been edited to reflect as such. One should almost NEVER ask for a credit increase in under a year of having it, I have never asked for one in my life and have had my limits raised automatically by as much as 10k without ever asking. Use it responsibly and pay it on time and that will give them a reason to increase it, if you don't see an increase in 2 years, you have a bad creditor, you can ask but unless you REALLY need it, don't ask for sake of just having it. – GµårÐïåñ Jul 10 '17 at 19:34
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There are really only two ways that your credit limit will be increased on a standard credit card:

You ask for it

Most of the time this means you'll see a new hard inquiry on your credit report. Expect to see a ding of a few points from your credit score (single digits). If your credit is already good, you've been managing the account well, and haven't already had any increases in the last year or two, it'll probably be granted. The hard inquiry stays on your report for 2 years whether or not they grant you an increase.

It's just given to you

If you have been using the card responsibly, the company may give you an increase without you having to ask. You won't see a hard inquiry added to your credit report in this case, but they should write to you to let you know about your new limit (they'll want you to start using it after all - more merchant fee income for them). If you don't want the new limit for some reason*, you'll have to ask them to reduce it. There is no penalty for doing so.

* E.g. you're mortgage shopping and want to minimize your current debt-to-income ratio.

When you say you're "eligible for an increase" I assume you've received a mailer from your credit card company suggesting you ask for one. Even if you are pre-screened, following up on this and asking for the increase will still put a hard inquiry on your report, however the pre-screen means they've already done a soft inquiry and are pretty confident you will qualify.

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    Note that even though the hard inquiry stays on your report for 2 years, it only affects your score for at most 1 year: money.stackexchange.com/a/77630/17718 – TTT Jul 5 '17 at 14:58
  • @TTT Thanks! I knew the effect does not last the full two years, but I wasn't sure exactly how long it actually stayed for. The linked answer is very detailed. – CactusCake Jul 5 '17 at 15:16
  • Would a higher limit, if not used, affect debt-to-income ratio or have any negative effect on the mortgage shopping example? If it doesn't, then the customer doesn't need to ask for a limit reduction - they can just act as if they still had the lower limit (unless they lack self-discipline and really need the externally imposed restriction). – WBT Aug 9 '17 at 19:29
  • @WBT I think it depends on the lender. I have seen other users comment here on finance.SE that their unused limits were indeed used against them in the debt-to-income ratio calculations used by potential lenders. – CactusCake Aug 9 '17 at 19:33
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If the card issuer makes a "hard pull" of your credit history, a new hard inquiry will be added to your report and your score will be affected by a few points. This may or may not have an effect on future credit applications, and will stop being a score factor in a year.

However, many issuers do a "soft pull" on a limit increase request, which will not affect your score. As an example, my cards from Capital One and Discover will do a soft pull when I ask for an increase every few months for normal credit building. Navy Federal Credit Union, on the other hand, will do a hard pull for an increase request. Every. Single. Time. If it is not clear which kind of inquiry the card issuer will do, just call them up and ask.

Either way, being declined for the increase or any credit application will not affect your score. Requesting it might affect your score.

Also, don't stress too much about the hard inquiries. They're a normal part of credit growth, and a small and temporary part of your score.

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  • The hard pull will hurt you, so don't apply for too many lines too fast, their effective damage will wear off in 6 months but they WILL appear for 2 years and during that time if you have "too many inquiries", yes that can hurt you and yes it is a normal part of growth but should be done with a plan; also while most existing lines of credit will do a soft pull which won't hurt you, not all do that, so done assume but given the rise of free "scores" by most creditors, this means they already have your "worthiness" on file, so shouldn't be much of an issue going forward – GµårÐïåñ Jul 10 '17 at 0:02
  • @GµårÐïåñ was this meant to be an answer? – Rakurai Jul 10 '17 at 0:26
  • NO, I was trying to help you better submit yours and get proper credit for making an effort. I have no ego and no interest in pumping my rep, I contribute for the sake of the community, not because I want something out of it, so helping others who took time to post an answer is to me the most constructive use of my time rather than writing a full answer for something that can be answered in a simple comment. Good luck and welcome to the site. I often post comments that are actually full answers and asked to make it as such but feel no need to do so, so others have often taken it and done it – GµårÐïåñ Jul 10 '17 at 18:44
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    I do appreciate the effort to help people improve their answers. I agree in general with your comment - you should have a plan with your inquiries. However, I also think that people stress too much about a minor 2-3 point ding to their credit. – Rakurai Jul 10 '17 at 19:11
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    The more people obsess with irrelevant details, the more they will actually hurt themselves in the process. It is like when a stock goes down the novice will sell it off hoping to stop the bleeding, but if they realized the bigger picture of long term goals, it USUALLY normalizes over time. With credit, short term hits will scare many and they often do something dumb in an effort to "get it back" like a gambler, but end up losing it all to the house because their actions actually had their own adverse effects. Education in this area is important and sadly many lack it or have it on bad sources – GµårÐïåñ Jul 10 '17 at 19:20
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In my experience with all my credit cards, whenever I ask for a line of credit increase, the bank evaluates only my relationship with them (i.e. on-time payments, debt to credit ratio, etc.). As a result, a request does not generate a hard credit pull and does not impact my credit score - even if the request was declined. If they needed more information and needed to access your credit report, they will ask you for permission beforehand and you can deny that with no repercussions. However, it does depend on the wording of the request before you click "Submit".

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