Reducing Credit Limit

TakingControl

Hello
I have finally paid off my credit card :j I would like to reduce my credit limit but was wondering if this would have a negative impact on my credit rating?

Thank you

[Deleted User]

Depends. If you have a lot of unused credit, it could be positive. If it means you will always be using a large proportion of your available credit, it could be negative.

stephane_2

If that is the only credit card that you have then it might not be in our benefit to reduce its limit....
What is the card limit? Any other debt? What is your income?

StuC75

potential either way..

Credit Ref agencies do report credit limit history on cards (know virgin \ mnba show on mine).. but there would be No info as to why reduced..

with lower credit limit your credit utilisation may show as a higher % when weighed up with other accounts you have..

so more a case of weighing up what earnings are, what the available credit is as % of this, and what your left owing on other commitments.. along with what your intentions may be in the meantime...

TakingControl

Thanks everyone. Right, by the end of the year I will be debt free (now paying off a defaulted credit card). The credit card is a main stream credit card which I managed to never default or have late payments.

Once the default is paid off, I have no outstanding debts or open accounts other than this credit card.

Current Card limit is £5200
Current Income is £44600 per annum before tax

Edited to add: I have no intention of taking out any other credit and will use this card monthly for fuel/food and pay in full to start rebuilding my credit file as I will next start saving for a deposit for a house.

CLAPTON

leave well alone especially if your credit files show defaults etc.

[Deleted User]

I'd keep it at its current level. It's not a massive limit and it's always good to have something for when your boiler blows up.

TakingControl

CLAPTON wrote: »

leave well alone especially if your credit files show defaults etc.

Could you please explain?