Should I close my CC accounts?

Sally22_2

I currently have 5 credit cards, but only have balances on 2 of these. Looking to get a mortgage next year, will it benefit me (and my credit score) to close the CC accounts I dont use?

Egg - £4500 limit - £0 balance
Virgin - £1500 limit - £0 balance
Post Office - £1000 limit - £0 balance
Tesco - £950 limit - £850 balance
Barclaycard - £1900 limit - £1500 balance

Bit of background, I can pay the balances off by October this year, and would like to keep the Tesco one as I use it to collect Clubcard points but the others Im not fussed about. also my salary is £19150 before tax so my limits add up to nearly 50% of my salary...

Also if I do close the cards, do I just write to the card issuers and they will close them?

Thanks in advance for any responses.

DizzleUK

You can cancel them by phone, which is surprisingly hassle free.

It won't hurt to close one or two of them, but before you do, check that the 2 cards with balances are the lowest APRs out of the 5. No point paying more interest than necessary.

When choosing which one(s) to close, choose the ones with highest APR first (regardless of whether you use them) followed by the ones you have have had the least amount of time. Keep the ones you've had the longest as these strengthen your credit record.

Sally22_2

Thanks for the help

Degenerate

What are the interest rates? You should definitely look at the possibilty of shuffling the debt before you decide which ones to close. Virgin (MBNA) in particular offer some good balance transfer deals to existing customers. It's often worth a chat with their "customer loyalty" department as they are empowered to offer deals on the spot, and having zero balance and the intention to close the account puts you in a position to negotiate. Barclaycard make good offers too sometimes, although they are by invitation only - their call centre is useless. You'll need to do some maths to see whether this can work for you taking BT fees into consideration.

See the "credit card shuffle" article here:

http://www.moneysavingexpert.com/cards/cut-credit-card-interest

Looking at your debt/income ratio I would maybe close the Egg card for starters to get that down. Then you may be able to get MBNA to increase your limit and move everything to that, assuming a worthwhile BT is on offer.

MBNA's customer loyalty department can be contacted directly on 0800 783 1116 8AM - 7PM.