Does lowering your overdraft limit affect Credit Rating?

rawkinrich

Hi all,

Simply question really (I think!) but by requesting your bank to lower your overdraft limit from say £2500 to £1000 affect your credit rating for the better?

Cheers,
Rich

AnonymousForObviousReason

Yes. It won't turn a terrible credit score into a good one though. Basically one of the checks is they look at all your available credit, the lower the better - but just because you've removed £1,500 doesn't mean you'll automatically get that much for the next application.

Wish I could be clearer but I don't think anyone knows the formula for how these things work.

rawkinrich

I see. Many thanks :beer:

choc_mouse

Another point to note is that they might do a full credit check if you ask them to lower you're overdraft. Natwest did that when I asked them to lower my overdraft (and tried to sell stuff whilst I hung on the line for the checks to be done). So if you're going to lower several overdraft accounts on the same day, it might affect your credit profile in the short term. Should be fine if you've only got 1 or 2 accounts to change.

rawkinrich

choc_mouse wrote: »

Another point to note is that they might do a full credit check if you ask them to lower you're overdraft. Natwest did that when I asked them to lower my overdraft (and tried to sell stuff whilst I hung on the line for the checks to be done). So if you're going to lower several overdraft accounts on the same day, it might affect your credit profile in the short term. Should be fine if you've only got 1 or 2 accounts to change.

I believe I should be ok - It's my current account that I'd like the overdraft limit lowered, and by then I will have no other outstanding credit (debt free!)