A higher credit limit enables people to spend in larger volumes and with greater frequency. Investors, businessmen, agents, and purchase department personnel, often need corporate or business credit cards which have a very high limit. However, they come at a heavy cost and with strict requirements that are levied by the card company.
All credit cards have a specified credit limit levied on them. The total value of transactions cannot exceed this prescribed limit. For example, if your credit card has a limit of USD 5,000, then you cannot make transactions that exceed this value per billing cycle (usually a month). This limit also does not include the charges (APR and service fees) that are being levied on the card. Late and default payments may however affect your credit limit and credit history. This enables the card holder to make many costly transactions within two processing cycles.
Following are some of the important features.
- These cards usually have an high APR (Annual Percentage Rate). The membership and service fees are constant, but are also high in comparison to normal credit cards. In some cases, companies also levy processing fees that range from USD 1 to USD 50 based on credit ratings.
- There are some low interest-high limit cards which have a highly variable APR ranging from 10% to 20%, and in extreme cases 30%, based upon the creditworthiness of the person.
- People having good scores that exceeds 660, can get a card with security, enabling a secured debt. They usually have a high APR projection that makes the transactions costly. People with excellent scores that exceeds 700, can have a fixed APR card which is unsecured.
- There are some cards for bad credit, that have a high value security requirement, high rate of interest, and high APR, which also can be availed
- The last feature is the implication of late payment and default. Both of these are very harmful for the credit report, as the company will report it immediately, and would also slap a fine on the next bill.
- If you want to buy high limit business credit cards, then the fees and interest rates will be a bit lower, and will be charged at a fixed rate. In some cases, the APR is set according to the credit score and credit history of the business organization.
How to Apply
Getting these cards is not easy, and a lot of preparation is required before you can apply for one. The first step is to calculate your monthly expenses that are made through them. Next, have a look at the limits of your current credit cards and find out if you are keeping any of them unused. Calculate the total APR and fees that you pay for each card. If your requirement matches the credit card offer, then wait for a couple of months to boost your credit scores and ratings a bit, and then apply.
The key to manage such cards is to handle your expenses and APR properly. If done meticulously, you will find that you are saving upon APR, fees, and interest rates very successfully.