# Credit Limit

*Borrowing & Credit — Finicade finance glossary*

A credit limit is the maximum balance a card or line of credit allows. Raising it lowers your utilization ratio, which can lift your score without you borrowing a cent — provided the increase doesn't require a hard inquiry and doesn't quietly increase your spending. Issuers cut limits during downturns and after missed payments, which mechanically spikes utilization and can drop a score sharply through no new behaviour of your own.

**Also known as:** credit line, spending limit

**Related terms:** [Credit Utilization](https://finicade.com/glossary/credit-utilization), [Credit Card](https://finicade.com/glossary/credit-card), [Revolving Credit](https://finicade.com/glossary/revolving-credit), [Credit Score](https://finicade.com/glossary/credit-score)

Source: https://finicade.com/glossary/credit-limit