To keep or cancel credit cards?

BrightonAmEx

Hi Guys,

I will say sorry now, because I'm sure this has been asked before, but...

I have just made a balance transfer to a Natwest Platinum card from my Natwest Mastercard and Barclaycard Visa of about £1000 of debt I have had since the start of uni. I graduated this year and am paying the debt off now (helped by the 15 month 0% BT).

My question is: for my credit record's sake, is it better to keep the credit cards unused, or is it better to close the cards? I had heard somewhere that if you cancel the cards it looks good on your record, but is it better to see that you have available credit?

I'm not worried about running up more debt, because I have an AMEX card that I use and clear every month.

Thanks in advance...

CannyJock

If these are your only 2 cards then just keep them. Cancelling or keeping them (unless they've got a £25k credit limit each) won't make much difference. To ensure that both cards continue to report a perfect payment history, make a small purchase on the card and clear it each month.

What sort of credit limits are we talking about?

BrightonAmEx

The Natwest Mastercard Platinum card (with the BT now on it) is £1500
The AMEX that I use for food shopping etc. is £1500
The Natwest Mastercard and Barclaycard Visa are £750 and £500 respectively.

CannyJock

Small limits - nothing to worry about either way.

The Platinum card you shouldn't use for spending now you've done a BT to it. Stick it in a drawer so you're not carrying it around

It's best to have a backup card for the places Amex isn't accepted.

To continue building a rosy credit picture, use the Natwest and Barclaycard for a small purchase each month and clear in full.

If you'll be applying for credit in the future and you're concerned that the £1250 available credit will affect the decision then cancel them a couple of months before you apply. Personally I wouldn't bother.

BrightonAmEx

Thanks for your advice.

And you are very right on the draw-treatment for the Platinum card. I have seen people that freeze their card to stop them from using it instantly though that seems a bit extreme!!