Closing a bank account - negatives?

Fang_3

I've got two current accounts with overdrafts that I'm going to pay off before August. I've had one since 2003, and one since 2005/6 (can't remember the exact date, it was around the new year). Obviously I've had these for quite a long time, with the majority of recent years being in my overdraft.

What I want to know is if it's wise to just close the accounts down and have done with them, or to keep a small balance in the accounts so that it goes onto my credit report as having a balance? I also remember reading about closing down bank accounts with credit facilities too soon having a negative affect on my credit report and this is something I want to avoid.

I would be eternally grateful for any advice on this.

Thank you.

apt

I doubt it would harm your credit report. It might even slightly benefit it. However, how long you have had your current account is a question that is often asked when applying for new products and it would presumably benefit your application if you've run a current account responsibly for a long time. So it might make sense to keep the older account.

YorkshireBoy

Fang wrote: »

...or to keep a small balance in the accounts so that it goes onto my credit report as having a balance?

Current account credit balances aren't reported to the CRAs.

And keeping a negative balance may cost you money, whilst serving no purpose whatsoever.

Fang_3

YorkshireBoy wrote: »

Current account credit balances aren't reported to the CRAs.

And keeping a negative balance may cost you money, whilst serving no purpose whatsoever.

I meant a positive balance. I was just thinking that keeping the account open may give me access to certain other financial products such as mortgages in the future? Thank you for replying.:)

Fang_3

apt wrote: »

I doubt it would harm your credit report. It might even slightly benefit it. However, how long you have had your current account is a question that is often asked when applying for new products and it would presumably benefit your application if you've run a current account responsibly for a long time. So it might make sense to keep the older account.

Thank you for replying. I have a different main current account that I use for all my day to day banking, which also has an overdraft on it, but has another three years at 0% so I'll be paying that off slower. I'm just trying to do what's best for my credit rating for when I come to apply for mortgages in a few years.

CLAPTON

mortgage companies like - no debts, high deposit, secure employment, good salary, a couple or so of CC used but paid in full each month and probably don't care whether you have 1, 2 or 3 bank accounts

however, personally I run three bank a/cs and use them regularly in case of random a/c difficulties (e.g. debit card arbitarily declined, foreign exchange fees on overseas purchases etc)