How do credit card minimum repayments affect my credit rating

DebtFreedom_2

Hi all

I went on to my Credit Report on Experian today (and cancelled my account on the same day:D), and noticed that there's a section against credit cards which asks 'Only paying minimum balances?'.

I have 2 0% credit cards, and I only pay the minimum balance, but will need to make a balance transfer to another card when my 0% comes to an end on one of these in June. Is it worth me increasing my minimum repayment by a notional amount so that I'm not just repaying the minimum...:think:

I know that repaying minimum balances is bad, but when you're on a 0% rate, it makes sense!

Any views gratefully received!

Thanks

MrsTinks

I have to admit I don't know... and just for that reason I have set my repayments at a fixed amount (usually what the first payment is as the minimum amount drops each month then but my debt decreases more LOL) since they started this
As you say it may only be minimally over the minimum but until I work out if my credit worthyness is a affected by minimum only payments when I think I'll continue with it Irritating on a 0% debt but hohum

ceejaydee23

I would seriously concider paying more to get the balances down before you exchange cards, as tbh the more your borrowing the less likely you are to be excepted on another 0% deal, being a rate tart isnt always the greatest thing, especially if you spend on them, or is it purely paying off the debts, that your tarting them? As i tried that and now i have 2 maxed out cards, that i was paying minimum payments on, BUT now cos of other more important debts i've had to call up n arrange a different smaller repayment to release some "more cash"

DebtFreedom_2

Thanks folks.

And another question... In order to reduce my available credit, I've been reducing my credit limit in line with my repayments each month. That means I have less credit available for when I need to re-arrange my cards. However, it also means that I'm close to my credit limit...

Which is best?!_pale_

By the way, I've been tarting the cards for some time, hoping to repay as soon as my HP is repaid.

MFWannabe

Hi
I would say it looks worse on your file if you are close to your credit limit

FLAPJACK

I agree with the last poster...but as long as you are paying regular it should reflect on you ok...maybe every other month pay just a bit more than the minimum though.

DebtFreedom_2

Thanks everyone.

It sounds like I've been doing it all the wrong way - and I thought I was doing the right thing!!

What a minefield...

From now on, I'll pay just over the minimum, and not reduce my available credit.

Cheerio!