Closing unused credit card accounts

MarkXy

Is it a good idea to close unused credit card accounts? My partner has a lot of these. If she closes a few, will it help her get higher credit limits in future applications?

She has not been rejected yet for any new cards, but I guess if she keeps on applying for the latest offers, she will eventually be rejected?? (even if her total debt is very low).

TrickyDicky

Yes, always cancel unsused cards. Providers use total unused credit as one of the main criteria, as it is an amount of debt you could suddenly be in tomorrow, which wouldjnt normally be a good thing.

WaxiesDargle

not sure I understand this thread...

I have an egg card with £9600 credit limit and I owe nothing on it...It's been like that for about three years and I have been able to get £10,500 from Virgin Money and £6,860 from Barclaycard to stooze with.... so having that unused card hasn't affected my credit rating

or isn't that what you are saying?

lisyloo

or isn't that what you are saying?

You've got the idea, but it hasn't got big enough yet for you to be a problem (for YOUR level of income).
If you continue you will eventually get turned down.

There is no magic figure, it would depnd on other factors like income and employment.

I would also say close cards because of fraud, theft, id theft risk.

NickX

Personally I think the decision to close down a dormant card depends very much on which card it is.

For example cards run by MBNA are known for excellent existing customer offers (repeat promotional deals) so I wouldn't close them down.

Also if you have a particularly high limit I would be tempted to keep the card because the chances of getting such a limit in the current economic climate may be slim.

lisyloo

Good points, but conversely with many lenders, new offers are only open to NEW customers so you have to close the card down and then re-apply, so as you say it depends.
In general I think everycard you have (without a specific reason) is a fraud risk.

Mr_K

Yes , you should close unused cards but don't assume they will actually totally close it.
See this thread:-
http://forums.moneysavingexpert.com/showthread.html?t=1362027
Charges can still be made to your account after its closed (which is unfortunate if someone gets hold of your old account details and you're no longer monitoring the account...)