Voluntarily Reducing Credit Limit
 

I recently got approved for the Chase Freedom card with a credit limit of $1500. I was surprised since I usually get approved for higher limits. I would like to apply for Sapphire Preferred soon, but I'm thinking my chances won't be high given the low credit line on my Freedom card.

If I reduce the credit limit on one of my Amex cards (and thus the total amount of credit available to me), would this improve my chances of obtaining a Chase card? Or do banks only care about the amount of credit that they themselves extend to an individual?

Thanks in advance.

I dont think this will have any influence on a credit decision made by Chase.

I'm not sure that anyone will be able to answer your questions. Your credit situation is likely different from others, and there is no telling what happens when they crunch their numbers to make a decision. People can give you anecdotes about their credit situation and their dealings with Chase, but it may not get you any closer to deciding what is best for being approved.

I don't voluntarily reduce credit lines. If they decline my application, then I'll discuss my options based on the reason they provide.

Adjusting Amex wont help you, and do not go that route. Work on building chase history and payoffs, and dont apply for the sapphire any time soon, you will doom your effort.

Doesn't seem to matter - my Amtrak has a $600 limit while my SWA has about 30 times that. Use Credit Karma or an equivalent to get a rough idea of what your credit profile looks like. Banks, like the US Mint, should have plenty of dollars on hand they cannot get rid of.:D

I'm not sure how Amex would respond to such a unique request. Normally the request is for a line increase but I can understand why you want the Amex line reduced.

From personal experience, I have a Chase Continental Signature Visa card with a $23,000 limit. After having the card for a few years, I applied for the Chase Rapid Rewards Visa and was approved, but only for an $800 limit. I'm sure Chase applications are scrutinized a lot more for those who already have a higher limit card with Chase. And since I also had a Starwood Amex with a $15,000 limit, I'm sure that played into their decision as well.

I think the problem is that you can't be sure how much of a reduction to request since approval procedures are not known. I never hurts to call and ask Chase Sapphire.

Reducing your AMEX credit will actually hurt your chances of getting approved. One of the factors that is built into your credit score is the % of your available credit that you're using (with a lower utilization being preferred). If you decrease your amex credit line, your % utilization will increase and your score could decline.

Nope. Infact, it might affect your overall utilization and as a result might hurt your credit score.

The only time I reduce CL's is when I need to reallocate CL's with the same credit card company to get an approval for a new card. I did that with Chase for myself & my wife. I only close accounts when the above don't work and I want the new card with the giant signup bonus. (50K-100K points)

It seems like Chase seems to be the most willing to reallocate CL's after a credit decline if the reason is too many inquiries/too much credit allocated. They lump the two reasons in one statement. Since either of us don't have excessive inquiries, it was we already had the max credit that Chase would allow us to have.

Bottom line: Don't reduce CL's/close out accounts unless it is needed to get a large signup bonus (50K/100K points) on a new CC. I keep a few old no annual fee cards around (signed up in 1990's) to keep a more lengthy credit history.