Egg Card - to keep or close

Megalomaniac

Hi all,

A couple of months ago I went through my credit reports. I thought I had been the victim of identity theft as I received an email to an unused email account (my ISP account) from Virgin saying I had successfully applied for a credit card with them etc... (it was even in my name). This 'application' did not display on my Experian or Equifax credit reports so I assume someone with the same name used an incorrect email address.

Anyhoo... I am a PhD student and on a fixed income of £12,000 NET - before this I worked for a while and have three credit cards, available credit ~ £10,500. One with Nationwide (for use abroad), one with Egg Money (for majority of spending) and the other is the Egg Card which is hardly used and has an available credit of £5000 on it (I may make a £5 purchase on it each month to keep it ticking over).

When I got my credit score from Experian, it was 999 (the best, flawless) but when looking at what other credit cards I was eligible for based upon my credit report, the only cards that were suggested were prepay cards and high interest such as Vanquis and Capital One. I can only imagine this is due to my very high level of available credit. I pay balances in full each month.

So what I am wondering is whether I should:

a) Close my Egg Card account (reducing available credit to me to ~ £5500)
b) Reduce my Egg Card available credit (to around half or less?)
c) Stick with what I have got

I don't expect to be making any credit card applications in the near future but could be missing out on offers/incentives from other companies and may need to consider finance for a car purchase in 6 months time. One thing I do like about Egg is that they have reduced my APR to 10.9% on the card, and is still 7.9% on Egg Money so I know I am looked upon favourably.

Any thoughts/advice appreciated

Karl.H_2

Stick with what you've got. Never reduce balances because it will affect your available credit vs. debt percentage – and future credit card providers will wonder why your limits are so low. Always keep your first card because it shows a longer history of responsible borrowing.

td_007

Megalomaniac wrote: »

When I got my credit score from Experian, it was 999 (the best, flawless) but when looking at what other credit cards I was eligible for based upon my credit report, the only cards that were suggested were prepay cards and high interest such as Vanquis and Capital One. I can only imagine this is due to my very high level of available credit. I pay balances in full each month.

To be fair the suggestion for cards is just indicative.If you feed in your details for e.g. in moneysupermarket.com you will come out with a different set of cards! However, 10.5K is really not a large credit to hold - I have that on just one card and have never had problems getting new ones (I never carry a balance unless it is 0% offer). So I would not bother reducing number of cards or credit limit at the moment.

Moggles_2

When looking at what other credit cards I was eligible for, based upon my credit report, the only cards that were suggested were prepay cards and high interest such as Vanquis and Capital One.

Suggested by whom?

Megalomaniac

Moggles wrote: »

Suggested by whom?

Experian through their website which looks at your credit report and suggests the cards you are most likely to be accepted for. Admittedly they are cards with incerntives for Experian if I signed up for them with their links, but there are other cards advertised on the site with much better offers on them.

I must say I didn't think about holding my first card. In fact, I closed my first credit card with natwest a year ago or so, after having it for 7 years. I guess I have had the Egg Visa since 2005 so probably is a good idea to stick with.

Thanks for all your thoughts!

CannyJock

Karl.H wrote: »

Stick with what you've got. Never reduce balances because it will affect your available credit vs. debt percentage – and future credit card providers will wonder why your limits are so low. Always keep your first card because it shows a longer history of responsible borrowing.

Wouldn't say never. Total credit (used + available) is making more of a difference than % used on new applications from what I'm seeing.

Barclaycard are a good example where you would reduce the credit limit to £5000 because that's the maximum 0% amount you can get for stoozing (reduce it after doing a BT of £ 5000 )

Karl.H_2

CannyJock wrote: »

Wouldn't say never. Total credit (used + available) is making more of a difference than % used on new applications from what I'm seeing.

Barclaycard are a good example where you would reduce the credit limit to £5000 because that's the maximum 0% amount you can get for stoozing (reduce it after doing a BT of £ 5000 )

Yes I see your point. However, having low credit limits on cards you have had for a long period of time will flag a problem to potential lenders because normally people who manage their accounts 'well' will be rewarded with credit limit increases. In this case, perhaps there would be no negative implication of reducing the balance.

Megalomaniac wrote:

... the only cards that were suggested were prepay cards and high interest ...

Megalomaniac, I seriously don't believe the site recommending these cards is accurate and in practice you will be eligible for 'better' credit cards / loans in the future.