How having too much credit can affect you

Yes, you can have too much available credit. There’s not a specific dollar amount of credit that’s considered too much. But, the factors normally come down to your financial and credit history and, of course, the lending guidelines of your financial institution.

Every financial institution has their own underwriting policies. What’s considered “too much” credit at one company may not be a concern at another company.

Your personal financial and credit history are probably the biggest factors in the decision to deem you as having too much available credit. The lender will want to limit its exposure to your risk of defaulting on your payment obligations. So, if they feel that approving your request for credit or a loan would overextend you, they’re likely to decline your application. 

Although there’s not exactly a set dollar amount that creditors like you to have in available credit, most companies have debt-to-income ratio thresholds that aid them in their underwriting decisions. You should be able to contact the lender to find out what their debt-to-income ratio requirements are.