My wife applied for a credit card and her application went under review. We called to follow-up on why it wasn't immediately approved and they said her credit limit on her other card was too high (~$35k) with a low utilization and they could approve the application if we reduced the credit limit on that card to open the new one.

Is that going to affect her credit negatively besides just a credit ding for the application? Her total credit limit is not changed it's just spaced out over 3 cards instead of 2 and her utilization on the reduced card is nowhere near 30% even with the reduction in credit.

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Posted by Weekend Warrior79

Member since Aug 2014

16397 posts

Posted on 12/8/20 at 10:38 am to Special K

Only negative effect I see is a new card would reduce her credit age (medium impact), but she will also have an additional account (the more the better)

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Posted by Chasin The Tiger

Lake Travis, TX

Member since Sep 2012

576 posts

Posted on 12/8/20 at 10:43 am to Special K

If the card you're reducing the limit on has a high balance, it could increase your utilization on that card and hurt your score.

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Posted by Teddy Ruxpin

Member since Oct 2006

39582 posts

Posted on 12/8/20 at 10:43 am to Special K

I do this all the time.

These types of things have very limited impact on credit or are short in duration if you have any sizeable credit extended to you.

If you are the type with bad habits carrying balances and have low total credit limits, then you have problems, but your problems are bigger than any credit score in that event.

This post was edited on 12/8/20 at 10:45 am

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Posted by Special K

Member since Jun 2011

1101 posts

Posted on 12/8/20 at 11:19 am to Teddy Ruxpin

Appreciate the responses.

Utilization on the card isn't an issue even with the reduced limit and we never carry a balance over. Glad to hear there isn't much of an impact

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