According to credit rating agency Transunion, consumers made $72 million more in card payments than they did in card purchases from the first quarter of 2009 through the first quarter of 2010.
Sure, charge-offs are a factor (debt that card companies write off as uncollectible), but Americans are clearly doing a better job handling their credit card debt.
"Many people in the financial services industry believe charge-offs have been the leading factor in declining credit card debt since the start of the recession," says Ezra Becker, vice president of research and consulting at TransUnion. "In fact, some have stated that charge-offs account for the entire change in card balances over the past two to three years. In reality, the dynamic is more complex. Our analysis shows that consumers have made a concerted effort to pay down their credit cards during these uncertain economic times."
But with the economy in peril and credit tight, it is still tricky for some card users to turn that good behavior into higher credit limits. Here’s how to increase your chances of getting an increase on your credit limits:
Know what card issuers look at. Credit card companies take your credit limit seriously. So much, in fact, that they won’t grant you a fatter credit limit unless you jump through a lot of hoops first. By and large, here is what card companies look for:
- Your yearly household income.
- Your credit card payment history.
- Your current credit card balance in relation to your current credit line.
- Your recent payment amounts in relation to your balance.
- The debt-to-payment balances of all other debts that you have shown on your credit report.
- How much available credit you have from all other credit accounts as shown on your credit report.
- The amount of recent inquiries on your credit bureau report.