Do you hold an American Express Card and think that there are no spending limits? If yes, this is the high time you need to come out of this wrong notion. You need to know that American Express cards do have spending limits. However, the main thing you need to know that the calculations on the spending limits of these cards. What happens if you hit the spending limit of American Express Cards? Find it here!
The first thing that you need to be aware of is American Express cards are not credit cards. These are termed as charge cards. This means the balance you charge on the card is due for each month. People make money on these cards by charging an annual fee and from the merchants who pay the fee after each transaction.
American Express Cards DO Have Spending Limits
Therefore, the prime benefit of these cards is the allowance of charging whatever it thinks you can afford to pay off each month. However, there are certain American Express Cards like the Blue Cash or Everyday cards are kind of best credit cards with designated credit limits, not charge cards.
However, read on to know how the American Express Cards with undeclared spending limits. Know here how American Express calculates your charge card limits.
The first thing is that American Express determines the spending limit based on your annual income report. They also take your payment history with their cards under consideration. Typically, you’re an AmEx spending limit is three times your highest-paid EMI balance over the six months. This card also provides with your flexibility of paying your pending charges. If you pay the charge for the first month without any default, you can add points on your cards. When you pay the amount without any fault, you can add points and later get a proper discounted amount while paying your dues.
If you want to make a large purchase by using AmEx cards, you can increase the charging point of your card. It means, gradually the spending limits also get increased and so is your reward points. Apart from that, if your annual income increases with a specific increment, you can update to the customer care and get your spending limits high.
This excellent credit card will allow you to make purchases without any hassle. You can go for it with an annual fee.
Why it is best to keep American Express Card?
In American Express Card, you can enjoy a lot of benefits. The first and foremost thing is the annual fee is very affordable. As it is a charge card, you can also enjoy the offer of paying the annual charge on each month. That means you do not have to pay a lump sum amount at the end of the year.
This advantage is only for the charge card. Credit cards do not allow paying the annual charge on an EMI basis. You can enjoy an amount of good credit when you use this card on a regular basis.
American Express Cards and Your Credit Scores
You can always opt for a charge card if you find your credit card access has been denied for high balances. This charge card is always good for your credit limits as they do not report a credit limit. You have to pay the entire debt of your credit card when you urge to opt for an American Express Card. Otherwise; it may be harmful to you if you try to get a new AmEx card with a huge amount of debt to pay in your credit card.
To maintain additional safety, when you plan to opt for new credit, don’t use the card before you apply for a new one. This will not harm your credit scores and you do not have to pay any extra charges as well.
Apart from that, if you merge your credit card with the AmEx card, your credit scores will be optimized accordingly.
However, there are still a huge number of advantages of using the American Express Card. Do not waste your time thinking about how to buy Apple Mac Pro with no money. Get the card and pay it off monthly. What say? Are you ready for it?