Can't Seem to Get Anything But a Low Limit Credit Card?

By Leni Parrish on May 3, 2009

You’re not alone! Many people are finding out that they can only quality for a low limit credit card these days. Not only that, but there are just as many people who previously had higher limit cards issued to them who are experiencing reductions in their credit limits – often through no fault of their own. It’s one of the methods credit card companies are currently using to reduce their risks because of the number of default customers they have.

Here are some common reasons why you would only qualify for low limit credit cards:

Choosing the Wrong Credit Card Lender

Some credit card lenders don’t offer high credit limits, period. It could be you’re just applying to companies that typically have lower limits than their competitors, and that you should be looking for a different lender for a higher credit limit credit card. Take some time to shop around – many comparison websites review credit cards and give you an idea of what the maximum credit limit is for each particular credit card.

Your FICO score is Too Low

All creditors review your credit report and score to find out what type of risk you are to them if they lend you money. If you have a low FICO score, you’re going to get lower credit limits offered to you because you are seen as a risky investment for the creditor. If you think your score should be fine, get a copy of your credit report (you are entitled to one per major reporting bureau per year) and make sure there are no errors listed that are causing you to get the lower limit offers.

Your Credit Report Contains Negative Items

Regardless of whether your score is in the “good” range or not, if your credit report contains too many missed or late payment notations; or something in charge off status, you’re going to be offered much lower credit limits than you would if you had a stronger credit history of making on-time payments.

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