Close credit card account for mortgage?

Dandydon83

I have 2 credit cards & i'm in a position to close the accounts as i've just cleared them both. I intend to apply for a mortgage so I wondered if I should close the cc accounts?
I've heard that some mortgage lenders use a ratio of balance vs available credit limit.
Is this true?

lisyloo

I've heard that some mortgage lenders use a ratio of balance vs available credit limit.

Lenders look at all sorts of things.
Maxed out credit cards would indeed be a red flag as it looks like you cannot manage debt.
Having well-managed credit cards is no barr to having a mortgage, in fact having a good payment history shows you can manage debt.

I don't think you'll get any benefit from closing the cards.
The last 6 years history will be there regardless even if you close them.

Lenders do take exisiting commitements into account, but if your cards are clear then that shouldn't be an issue either.

I don't think you'll get any benefit by closing them and credit cards have many good features e.g. section 75 protection.

YorkshireBoy

In my experience, mortgage lenders aren't interested in potential debit (ie available credit), only actual debt (ie used credit).

So I wouldn't close off a source of emergency funds, should you need them.

Dandydon83

Ok, thanks very much for your replies