Should I reduce CC Limit in order to improve Credit Rating?

LollyLou_2

Hi Everyone

I have 3 credit cards which I no longer use (I have cut them up!:T ) but they all still have outstanding balances on them.

What I am wondering is whether I should call each of the providers and get them to reduce my credit limit to an amount just about the outstanding balance? For example, my halifax credit card has an outstanding balance of approx £3K however the current credit limit is £4.5K. If I were to call Halifax and get them to reduce the limit to £3,100 would this look better on my credit file?

I didn't know whether it would be better to do this or leave it as it is and show that although I have available credit, I don't (and won't) use it.

Hope that all makes sense!

LollyLou

YorkshireBoy

Lowering the limits will give the impression you're maxed out, meaning future credit facilities may be denied.

Additionally, you'll lose out on flexibility for shuffling your debts if one or more of them make you an offer on your account.

Assuming your income, and other circumstances, will stand it, then leave the limits where they are.

CLAPTON

No, it will look as if you are then using a very high percentage of your available credit which make you look a bit desperate and unable to manage your finances.

LollyLou_2

Thanks Clapton and Yorkshire boy! I guessed you were going to say that but I just wanted to check. I will leave the credit limits as they are.

This site really is the bee's knees!!

:j

LollyLou.

Stubbsy055

Wow thanks for this info! Was going to ask exactly the same question!

I have £200 outstanding on one of my credit cards with a £5,950 limit.

I have another 2 cards that are not maxed out, but one comes out of its 0% deal in April. I therefore want the best chance in being successful in qualifying for a 0% card with another company to transfer the balance from that card to it!

Any additional advice for my situation muchly appreciated.