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Experience tells us that almost anything that’s unlimited (from bottomless coffee to eat-all-you-can buffet meals) has a hidden cost. Instead of drawing us near the goal, not setting a limit throws us into different directions. That’s because “no limit” is almost synonymous with “no control.” So in the murky world of credit cards, it only makes sense to treat terms such as “no limit” as suspect.

But why put a cap on credit usage if we can spend more and pay for it? This sounds logical but if we’re to look at the bigger picture the issue’s not just about whether you can afford to pay your expenses in full every month.

Can No Limit Credit Cards Ding Your Credit Score?

The answer varies since the effects a no limit credit card are mostly unpredictable. You have to remember that credit scores operate on a credit-utilization model, that is, the ratio of the amount of credit used to the total credit available. With no limit credit cards, you have to wonder how it is able to factor in this ratio. CardHub.com studied such credit cards including offerings from American Express, Visa Signature and World MasterCard and found that they either had no influence on a credit score or were just as capable of raising a score as lowering it. All in all, it was found that the impact on credit score differs depending on the credit card issuer. Discrepancies in how revolving credit limits are considered, as actual credit restrictions or maxed out limits even if you have spending allowance left, also figure significantly. They’re all dependent on policies adopted by lenders and credit score companies so it’s best to check how they deal with a particular no limit credit card.

How Responsible Are You When It Comes To Managing Credit?

Even if a no limit card won’t affect your credit score, as is usually the case with certain American Express, Chase and Citibank cards, unlimited credit demands immense responsibility. You can’t afford to be ignorant of what’s in the fine print. Check if the account is revolving or open. If it’s revolving, check if there’s a limit or high balance reported. A limit is usually factored in your credit utilization while a high balance is used for figuring utilization.