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Trying for Balance Transfer But Low Credit Limit?

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I had a reader send me the following email:

Hi Jim, I just got the Citi mtvU card hoping to get a good balance transfer to pay off something else but they only gave me a $3,000 limit, less than what I was hoping for. What should I do?

Unfortunately, you made the mistake of trying to do a balance transfer with a credit card designed for students. Since it’s designed for students, I wouldn’t expect them to give you a high limit no matter what your income was. In the future, I’d recommend something more mainstream like a Citi Professional (though not that one because the balance transfer is only for 9 months).

Anyway, the only thing I can really suggest is that you take the balance transfer for $3k since you’ve already taken the hit to your credit score (if it’s your only credit application in a while, I wouldn’t worry too much). If you just toss the card, you take the hit and you don’t get the cheap credit.

Now, one thing you can try to do, depending on how long the offer is good for, is to use the card as usual and then request for a credit line increase after six months (most companies won’t consider an increase until six months). So, if the offer is valid for more than 6 months, you can try that route to get more money. The downside to that is that you’re still paying that higher interest debt for that time period, so it may not be worth it.

Anyone else have any suggestions?

{ 3 comments, please add your thoughts now! }

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3 Responses to “Trying for Balance Transfer But Low Credit Limit?”

  1. Another option, which I actually did for my mtvU card was to re-allocate credit lines.

    This will only work if you already have another Citi Card, or are looking to open one up.

    Basically, all you need to do is call up Citi and ask them to transfer your credit limit from one card to the mtvU card. I had a Dividend Platinum Select with 10k Limit and got approved for a 4k limit on the mtvU card. I had no balance on the Dividend Platinum select, so I asked them to move 8k worth of credit limit to the mtvU card. They did this without any problems.

    Now I have a 2k Dividend Limit and a 12k mtvU card limit. I then balance transfered a large chunk off the mtvU. The 6 month 0% APR just ended for me.

    Good luck.

    William
    A Financial Revolution

  2. CPA1298 says:

    I took out about $40k in 0% no-fee transfers and just put the money in Emigrant, thinking I was all smart. Then, I moved and bought a house. My credit score had dropped from 785 to 685. When the banker ran my credit report and saw all that CC debt, she about fainted. Luckily, my wife had just begun working as a pharmacist, so our income carried us through. You cannot be too careful when it comes to applying for lofting credit card limits. Trust me.

  3. Miller says:

    William’s solution is what I’d recommend… reallocate the credit limits! Note, I couldn’t reallocate the Professional card with other Citi cards. They said cus one was “business” and the other was “personal.” Whatever.


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