To close credit card accounts or not?

Penny_pinching_piper

I'm getting conflicting information. Built up a lot of credit card debt over the last couple of years but really trying to get things sorted. I have several credit cards and have been swapping balances about when deals are offered but I'm getting to the point now where no deals are coming and I've been rejected for new credit cards that have offered 0% transfers. Recently went to my bank (Natwest) to see if they would give me a loan so I could consolidate but that was a no as well. They did however advise me to close any credit card accounts that aren't being used which amounts to £30000 available credit. Natwest said while ever these were open potential new lenders would look at this in a negative light beacause I could possibly run up more debt - which made sense. So I've gone about doing this to only find that after checking my experian report my score has dropped and not increased as I hoped it would.
Can anyone advise please?

Davie2909

It will take time to rebuild your credit report. Have you got a negative on credit searches on your credit report?
I would suggest keeping maybe 2 or 3 cards and don't max any of them out as that will be viewed in a negative light

rb10

Unless you are on a very high income, having £30k of available unsecured credit is a lot already, so it's little surprise that you are being declined for further applications.

The credit score that you see on Experian is not the same as the one that they provide to (potential) lenders - take it with a fair pinch of salt. You can rest assured that once the closures are shown on your report (this'll probably take a month or so), you will be more attractive to lenders.

Penny_pinching_piper

Thanks for the advice.

I've got no negatives on credit searches on my credit report. The negatives that do show are the amount of credit and number of accounts. This is the bit that I don't understand - my credit score has dropped 25 points after I closed one of the credit card accounts which now shows on my report as settled. My credit score is 'fair' at the moment. I've never missed any payments, had any defaults etc. I know I've got into this situation but I'm working really hard to get out of it.

YorkshireBoy

The reason for the change in assessment by the CRA is that your utilisation ratio has increased.

Getting rid of available credit means you're now using more of the credit available to you.

There are 3 important ratios in credit scoring:

(1) Used to available credit
(2) Used credit to income
(3) Available credit to income

Doing what you've done has reduced (3), kept (2) the same, but (greatly?) increased (1).

What's your income?...available credit?...used credit (debt)?