Show Notes
Why would a lender raise your credit limit when you're already struggling to keep up?
Credit approval algorithms look at your credit report and payment history, not your entire financial picture. You may be making every minimum payment on time while using a line of credit, cash advance, or buy now pay later plan just to keep up. To the lender, you can look like an ideal customer even while your debt grows every month. In this episode, Doug Hoyes and Ted Michalos explain how lenders decide who gets more credit, why credit limits can keep increasing, and what happens when the borrowing finally stops.
To learn more about debt relief options, please visit us at Hoyes Michalos Start Exploring Debt Relief in Ontario
They discuss: • Why being approved for credit doesn't mean you can afford it • Why lenders offer automatic credit limit increases • How borrowing to make minimum payments can hide financial trouble • The warning signs that your debt is becoming unmanageable • When a consolidation loan can help, and when it can make things worse • Why your bank account can be at risk if you owe money to the same bank • How to measure whether your financial situation is actually improving The key takeaway: don't use a lender's willingness to give you more credit as a measure of your financial health. Look at your total debt, your interest costs, and whether your balances are going up or down. Debt Free in 30 is hosted by Licensed Insolvency Trustees Doug Hoyes and Ted Michalos of Hoyes Michalos.
Hoyes Michalos Repayment Calculator Credit Rebuilding Course and Other Free Resources Start Exploring Debt Relief in Ontario Watch Our Library of Free Videos on YouTube! Time Stamps:
00:00 Why do lenders keep giving you more credit? 01:16 How lenders decide whether to approve you 02:16 What your lender doesn't know about your finances 03:31 Why credit limits keep increasing 05:01 Should you accept a credit limit increase? 06:44 How lenders encourage you to borrow more 07:42 How the debt cycle begins 10:00 How people accumulate debt while staying current 11:07 Robbing Peter to pay Paul: modern-day kiting 13:12 What happens when the credit finally stops 15:36 Can a consolidation loan help? 16:50 The risk of consolidating credit card debt 19:34 Why your bank account could be at risk 21:21 Warning signs your debt is becoming a problem 23:51 Make a list of your debts 25:47 Look at what you own, too 26:47 Think about interest in hours worked 28:25 The key takeaway If you need credit card debt help, start by listing every debt, rate and payment — and track your total, not just minimums. To learn more about debt relief options, please visit us at https://www.hoyes.com
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