Going over your credit limit can definitely hurt your credit score. Here’s a detailed look at how exceeding your limit impacts your credit and what you can do to avoid or minimize the damage.
What Happens When You Go Over Your Credit Limit?
Your credit limit is the maximum amount you’re allowed to charge on your credit card. It’s based on factors like your income, credit score, and debt-to-income ratio.
If you try to make a purchase that exceeds your limit here’s what will happen
- Your transaction will be declined unless you’ve specifically opted in to allow over-limit transactions.
- If you have opted in, you’ll be charged an over-limit fee, typically $25-35.
- The over-limit activity will be reported to the credit bureaus and show up on your credit report.
Going over your limit once isn’t devastating, but repeatedly doing so indicates you’re overextending your credit This risky behavior can hurt your credit utilization ratio and score
How Does Exceeding Your Limit Affect Your Credit Score?
There are a few ways that exceeding your credit limit can lower your credit score:
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Increased Credit Utilization – Utilization is the percentage of your total credit limit that you’re using. Going over 100% utilization signals high risk.
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Late Payments – Struggling to pay your bill after maxing out your card can lead to late payments, another score killer.
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Lower Credit Limits—If you keep going over your limit, your issuer may lower your limit, which will make your usage even higher.
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Closed Accounts – Maxing out cards repeatedly may cause issuers to close your accounts, shrinking your available credit.
Always try to keep the number of times a person uses their card below 100%. When you go over your limit, it goes over 100%, which can significantly lower your scores.
How Much Could My Credit Score Drop?
Most credit scoring models have a utilization ratio component, so exceeding your limit will always impact your score somewhat. However, the severity depends on your starting utilization and other factors.
For example, if your utilization was already 90% and you go just $50 over your limit, the additional damage may be minor. But if you had low utilization before maxing out, your score could plunge 100 points or more.
The impact also depends on your overall credit profile. If you have a long history of on-time payments, low balances, and open accounts, a one-time overage may not be disastrous. Still, it’s best to avoid the risk altogether.
How Long Does the Credit Score Damage Last?
The negative impact of going over your limit is temporary. As soon as your balance drops back below the limit, your utilization ratio improves and your score will start to rebound.
The over-limit charge could stay on your credit report for up to 7 years, though. If you regularly charge more than you can afford, it will hurt your credit scores over time.
The good news is that credit scores are resilient. If going over was a one-time occurrence, your score typically rebounds within a few months as the mistake fades into the past.
Tips to Recover From Exceeding Your Credit Limit
If you do accidentally go over your limit, here are some tips to get back on positive footing:
- Immediately pay down your balance as much as possible.
- Avoid using that card for new purchases until your balance is below the limit.
- Request a higher credit limit if eligible.
- Shift spending to cards with available credit.
- Get your free annual credit reports and dispute any errors.
- Sign up for credit monitoring to track your scores.
- Maintain on-time payments and low balances going forward.
With diligent credit management, a single over-limit instance doesn’t have to turn into a long-term issue.
How to Avoid Exceeding Your Limit in the Future
If you don’t want to hurt your credit, don’t go over your limit in the first place. Here are some tips:
- Opt out of over-limit transactions if possible.
- Set up account alerts to warn when you’re close to the limit.
- Review statements frequently to stay aware of your balance.
- Track spending against your limit in a budgeting app.
- Ask for credit line increases periodically.
- Divide payments between multiple cards to avoid maxing out one.
Exceeding your credit limit occasionally happens to most people. But making it a habit will continually suppress your credit score. With caution and planning, you can avoid costly overages.
The Bottom Line
Going over your credit limit always affects your credit score negatively due to the resulting 100%+ utilization. However, the damage is reversible if you quickly pay down your balance and maintain good credit habits going forward. Be proactive by opting out of over-limit transactions when possible and setting alerts. With diligence, you can avoid maxing out your credit cards.
How Going Over Your Credit Limit Can Affect Your Credit
Going over your credit limit can have a negative impact on your credit due to your credit utilization rate. Your credit utilization rate is the amount of your available revolving credit youre using on a per-card or total basis. The amount you owe on your accounts makes up 30% of your FICO® ScoreΠfor free for good reason: Credit scoring models tend to view higher credit utilization ratios as an indication you might be financially strapped and a risk to the lender.
To reduce your credit card balances impact on your credit scores, its wise to keep your credit utilization ratio below 30%, but the lower, the better. Those with the highest credit scores tend to have a credit utilization in the single digits.
But if you spend, say, $11,000 on a credit card with a $10,000 limit, your credit utilization for that card would be over 100%. If the card is your only revolving credit account, or if you have other accounts with balances near or beyond their maximum limits, your overall credit utilization ratio could also be near or even over 100%. The effect of such high credit usage could be severely harmful to your credit score.
How to Avoid Spending Over Your Credit Limit
There are a number of actions you can take to safeguard your account against overspending beyond your credit limit, such as:
- Disallow overdrafts. Perhaps the most straightforward way to avoid spending above your cards credit limit is to disallow overdrafts when you sign up for your card. Similarly, if youve opted in to permit overdrafts, consider updating your account online or over the phone to disallow the option to allow overdrafts.
- Set up alerts. Many credit card issuers offer the option to set up email or text alerts that let you know when your account balance is getting close to its limit. Having alerts in place could help you avoid making transactions that exceed your limit. Alternatively, you may not need notifications if you have the habit of regularly checking your account balances.
- Request a credit limit increase. If you have a strong history of on-time payments on the account and sufficient income, your credit card issuer may approve a credit line increase to give you some extra breathing room. The additional credit could also lower your credit utilization ratio, which may positively affect your credit.
- Follow a budget. Set up a budget for your credit card that ensures youre managing your balance appropriately. While youre at it, you might set up autopay to ensure your monthly credit card bill is paid on time. Ideally, your budget allows you to pay off your credit card balance in full each month to avoid interest charges and to keep your credit utilization ratio low.
What Using 50% of your Credit Limit Does to Your Credit Score
FAQ
What happens if I accidentally go over my credit limit?
If you go over your credit card limit by accident, you might have to pay fees, have transactions declined, and your credit score might go down.
Does your credit score go down if you go over the limit?
Your total credit utilization determines about 20% of your credit score, so going over the limit on one card can add to the negative reporting to the credit bureaus.
How much does over-limit affect credit score?
Will it hurt my credit score to increase my credit limit?
… payments on time—in addition to other responsible credit habits—your credit scores shouldn’t be negatively affected by a credit limit increase in the long runFeb 25, 2025.