Help: do credit limits on CCs affect your credit rating?

drewster_2

Hi everyone

I'm new here and have a question that has been bugging me.

I am in debt, but earn a decent salary and am attempting to pay things off and get my finances in order!!

My Virgin credit card balance transfer deal ends in October and I want to make sure I apply - and get! - a new card with a good transfer deal.

But, I'm worried about being rejected, so wondered if anybody could help: do the credit limits on your card affect the credit report you get?

My Halifax 'ONE' card have given me a limit of £11,000!!!! Which I obviously don't use in full (there's about £1,000 on there now), but do creditors see that as me having £11,000 of debt?

My Mint card, which I no longer use, has a limit of £5,000 - so that'll show up too.

Is this what might be making it harder for me to get new credit cards etc?

If anybody can advise, that'd be great.... thank you! :money:

markmc999

I'd say any spare cards you no longer use - get rid of.

Most lenders now look at the available credit you have, as well as what you actually use, when deciding on applications. This is to try and stop people getting too much into debt.

Amount of credit available does show up on credit reports. You can get copies of your own reports at https://www.experian.co.uk and https://www.equifax.co.uk for about £2 to see what info they are reporting.

Luke

I'd say the best thing to do is cancel the mint card.

By the way I have a Halifax One have noticed that balance trancefers are 2% max £50 (shows this on statement). For new customers its advertised as 3% uncapped. If you have still a while left of your Halifax card just switch the balance to that.

When your Halifax deal finishes give Virgin a call as they are usually good and may give you an offer.

This will prevent you applying for any new cards.

Moggles_2

My Halifax 'ONE' card have given me a limit of £11,000!!!! ... (there's about £1,000 on there now), but do creditors see that as me having £11,000 of debt?

They see it as available credit, which you could use at any time.

Is this what might be making it harder for me to get new credit cards etc?

Possibly, but (there's always a but)
It depends how many and which cards you've applied for unsuccessfully in the last 12 months? The answer could be as significant as your available credit.

If you have still a while left of your Halifax card just switch the balance to that.

If you've already applied for new credit cards this year and were turned down, this is definitely your best bet, providing you're still eligible for the 0% balance transfer that is.

aakayb

If you are going to cancel one of the cards, do it well in advance, as it can take 1/2 months to cancel a card.

jay78

You could reduce the limit if you don't want to cancel.

Moggles_2

If you are going to cancel one of the cards, do it well in advance, as it can take 1/2 months to cancel a card.

Good point. Some lenders develop extreme hearing/memory loss, when asked to close an account!

aakayb

Moggles wrote:

Good point. Some lenders develop extreme hearing/memory loss, when asked to close an account!

Yes they are like retailers, who are happy to have escalators into the store, but have normal stairs out.

The_Boss

In my opinion, and from experience, I'd reduce the Halifax card limit by £5000 rather than closing the Mint.

Then again, if you phone Mint and ask to close the card, then they may make you a good offer, which means no need to apply for a new card. If they do this, then definitely reduce the Halifax limit down.

The_Boss

Also, if you reduce the credit limit, then that should show up on the next credit file update. If you close a card, as said by someone else above, it may take a few months to be updated as 'settled'.

Moggles_2

Also, if you reduce the credit limit, then that should show up on the next credit file update. If you close a card, as said by someone else above, it may take a few months to be updated as 'settled'.

Whilst I don't disagree with your reasoning, people's circumstances vary. As far as we know, the OP has just three credit cards in total, which is not a lot.

I think reducing a credit limit may be unhelpful in this instance.

Is this what might be making it harder for me to get new credit cards etc?

This question implies that at least one credit card application has been declined. We need to know how many and which cards the OP has applied for unsuccessfully in the last 12 months?

IMO, the answer and other factors could be at least as significant, possibly more so, than the OP's available credit.