Last night I called Visa about a few things. One of those things was to ask for a credit increase.
I don’t need a credit increase really, as I only use my credit card when I am back in Canada, but my current plan is take a temporary hit on my credit score in order to have a stellar report 4 or 5 years from now when we are in the market to buy a place.
When I am back in Canada, I use my card for about 90% of my purchases. This results in using about 50% of my available credit. Having a high ratio (amount charged to amount available) is a bad thing for your score, so I wanted to increase my limit, so that when I travel the same purchases will only be about 30% of available credit.
The chap I was talking to said that I have a pre-approved credit increase available on my account. It was less than I was asking for, but by going this route I have achieved nearly the same effect without affecting my score.
The reason, as I was assured by the rep, is that pre-approved increases on existing accounts have no bearing on your score because it is a completely internal review; there is no inquiry into your entire credit report. It is completely based on your account history and the assets you hold with the bank.
Let’s be clear here. I am not talking about getting a piece of junk mail for a pre-approved card. That will affect your score if you apply, as it would be a new account. I am talking about a pre-approved increase on an existing card.
My next question for the lad was why I didn’t know about it. I have electronic statements, so shouldn’t I have gotten the offer by email? Not necessarily, he said. Some times the pre-approved increases are on the account, but are only mentioned if the customer happens to call.
It was nice to know that the companies aren’t always soliciting for more credit, but that there are instances where they will work with you if there is communication. That was a little reassuring.