Lower credit limit?

[Tonyladz]

I have a qantas ultimate with a credit limit of 16k. I recently got declined for the amex reserve. Would lowering my credit limit to 2k increase my chance for the amex reserve? I also don't need a high credit limit as I have platinum charge with good spending power. I always pay my statement in full. Also bit disappointed that they removed the $400 tc for the reserve. That's $400 in flight credit gone. Not sure if they will offer something else for new members.

 

[Bell21]

There are different views on this, but I tend to make sure that i only have the credit limits I need when applying for additional cards of any nature - so if I had a not-in-use card, I would decrease the credit limit to the minimum if I didn't need that additional credit - depends on your income as well of course what you do and there's some thought that credit utilisation (% use of available credit) also plays a part (which probably runs against reducing credit limits, but I tend to disregard that).

 

[ChrisFlyer]

Given you've already applied, it could be a good idea to just call AMEX, tell them you were declined, and outline that you're happy to sacrifice some of your existing line of credit to fund the new card, so that the amount of credit isn't increasing.

When I applied for the Reserve a while back, I called AMEX before applying and had them look at the account to see whether I'd be approved as-is, and they said there shouldn't have been any problems, but if there were, they could always take some of the credit limit from another card - seems like that could be the way to go (whereas if you drop your credit limit, they may have a rule about applying for new credit over within a certain amount of time that could see you denied again).

 

[andye]

There are different views on this, but I tend to make sure that i only have the credit limits I need when applying for additional cards of any nature - so if I had a not-in-use card, I would decrease the credit limit to the minimum if I didn't need that additional credit - depends on your income as well of course what you do and there's some thought that credit utilisation (% use of available credit) also plays a part (which probably runs against reducing credit limits, but I tend to disregard that).

Percentage credit utilisation doesn't figure in Australian credit scores or card assessments. Different in the US

Post automatically merged: Oct 8, 2020

Out of interest, what is the appeal of Reserve without flight credit? More cards for offers?

 

[knagelli]

I have a qantas ultimate with a credit limit of 16k. I recently got declined for the amex reserve. Would lowering my credit limit to 2k increase my chance for the amex reserve? I also don't need a high credit limit as I have platinum charge with good spending power. I always pay my statement in full. Also bit disappointed that they removed the $400 tc for the reserve. That's $400 in flight credit gone. Not sure if they will offer something else for new members.

Just getting my head around this , is the flight credit for Reserve removed for new card applicants or even for existing card holders. Apologies if this was already answered elsewhere.

 

[andye]

Just getting my head around this , is the flight credit for Reserve removed for new card applicants or even for existing card holders. Apologies if this was already answered elsewhere.

Only removed for new applicants

 

[Tonyladz]

Percentage credit utilisation doesn't figure in Australian credit scores or card assessments. Different in the US

Post automatically merged: Oct 8, 2020

Out of interest, what is the appeal of Reserve without flight credit? More cards for offers?

Just that the card has no annual fee.

 

[Bell21]

Percentage credit utilisation doesn't figure in Australian credit scores or card assessments. Different in the US

Post automatically merged: Oct 8, 2020

Out of interest, what is the appeal of Reserve without flight credit? More cards for offers?

Thanks, now I recall why I've never bothered to pay attention to credit utilisation. I think reserve is only of interest if you have it with travel credit (i.e. existing card holders)

 

[albyd]

When I’ve applied for a new Amex credit card in the past, I’ve always applied for the minimum limit then after approval, asked for limit to be reassigned from another card. Happens instantly.

Haven’t applied for any new Amex cards since last year’s deval so things may have changed over that time.

Agree with Bell21 Reserve wouldn’t be on my radar without the $400 TC I’m not sure it has much other attraction since the deval. Charge is more attractive unless you need to spread payment over time using a traditional credit facility.

 

[knagelli]

Thanks, now I recall why I've never bothered to pay attention to credit utilisation. I think reserve is only of interest if you have it with travel credit (i.e. existing card holders)

I have my reserve and my TC got posted just last week on card anniversary. One other thing with Reserve other than the travel card , the offers are pretty similar compared to charge card. If it works out in our favor .... there are good cashback offers on reserve too.

 

[samh004]

There is a period of time you'll need to wait before re-applying, so definitely call them up and work out what this is or you'll almost certainly be declined again, and this could affect your credit score.

I believe the minimum credit offered on the Reserve is $3k, so this is all you'll need to remove from the Ultimate.

When you do end up holding both cards, you can get them to close the Ultimate and transfer the credit on that card to the Reserve to end up with $16k again.

 

[albyd]

The other thing is Amex has a limit to the number of credit cards you can hold with them simultaneously - I think it’s 2 from memory but they usually call you up after you’ve applied to ask you to cancel one to make way for the new one.

 

[ChrisFlyer]

The other thing is Amex has a limit to the number of credit cards you can hold with them simultaneously - I think it’s 2 from memory but they usually call you up after you’ve applied to ask you to cancel one to make way for the new one.

It was 2 a long time ago, now it's 4 credit cards plus as many charge cards as you can qualify for.
The number doesn't really matter as much as the total credit exposure across the cards (e.g. it makes little difference to AMEX from a lending perspective whether you have 4 cards, each with a $3000 limit, or 1 card with a $12k limit - either way, their exposure is up to $12k).