 TITLE: What Happens When You Go Over Your Credit Limit? CONTENT: A credit limit is the maximum amount that you can charge on a credit card. As a revolving credit account, there is no predetermined payoff date for the amount you borrow. You can charge up to the credit limit and pay at least the minimum amount due, with any remaining balance shifted over to the next month—with interest added.\nThe credit limit that's attached to your card is determined by the issuer when you apply for the card, and depends on three basic factors:\n*   **Your credit report and score**: Your history with credit is a major factor in the card's credit limit. After you apply, the issuer will review one or more of your credit reports or credit scores provided by the three consumer credit bureaus: Experian, TransUnion and Equifax. If your credit score is low (or you don't have one), you might be perceived as more of a credit risk, so the limit will likely be on the low side. If your credit score is high, the issuer will perceive you as less of a credit risk and, in turn, could grant you a higher credit limit. The number of open accounts you have and their credit limits may also be factored in—a card issuer might want to see how you're doing with your existing cards.\n*   **Your financial circumstances**: The issuer also considers your income, existing debt and other financial obligations. You would list those details on the credit card application. If you have a lot of available cash you can use to cover your credit card bill, the card issuer may bump up your limit.\n*   **The credit issuer's internal factors**: The credit card issuer may extend higher or lower limits based on how much money it is comfortable lending. Broad economic conditions and the lender's own financial circumstances are generally taken into account. Additionally, some accounts are designed as starter cards that have predetermined credit limit maximums, such as a secured card where the limit matches the security deposit.\nBe aware that a credit limit and available credit are two separate concepts. The credit limit is the amount that you can borrow, but the available credit is the amount you can borrow minus any outstanding debt. So if your credit card has a $5,000 credit limit, and you owe $4,000 on it, your available credit is $1,000. END