Credit Cards Paid off, keep to boost rating or close?

dd501

Hi, I have two credit cards which I have had for a while and have been paying off debts on them. I want to start building my credit rating back up by using a credit card and paying it off in full at the end of each month by direct debit.

Please could you let me know which one of these is best to do...

- Set this up a monthly DD on one of my current credit cards I've just paid off, and close the other

- Close both credit cards and apply for a new one which I can use to build up my rating by paying off in full each month.

I'm not sure if its best to start with a new card, as my current two cards will have a history of charges. I thought by getting rid of my old two I could get rid of that history and start a fresh with a new credit card.

Thanks very much

CLAPTON

no you don't get rid of the history just by closing the cards

best to use both cards for normal purchases and pay them in full each month

dd501

thanks for your reply.

Is it best to keep both or just use one and close the other?

Would it be better if I only had one, so I would have less credit available.

Is there any advantage to switching to a newer one if I am going to pay it off in full each month?

thank you

Eonel

There is no advantage to switching to a newer one if you are going to pay it off in full each month.

IMO keeping both open or closing one would depend on the sum of credit limits vs your salary. If both cards combined already offer you significant credit then close one as together they may prevent you from getting other credit in the future.

If they are both low limit cards then keep both open & paid off in full each month.

dd501

Thanks for your reply, how much would you class as low and high limits.

The limits for each are £1000

thank you

Venusflytrap

Partly depends on income: A person earning £20000 pa with a single CC limit of £1k (5% of income) may be classed as 'low'; Whereas someone earning £5000 pa with a CC limit of £1k (20% of income) may be classed as 'high'.