cancelling credit cards

TOOMUCHWORRY

Over the years myself and my husband have taken out various credit cards to take advantage of 0% balance transfers. We are currently using one each to pay of our debts : mine barclaycard £1500 and my husband virgin card £4000. These are currently at 0% but are due to expire in December and March respectively. I am thinking of applying for Nationwide 20 months at 0% in the next couple of months and transferring both outstanding balances to this. Firstly, how do we go about cancelling our other cards which all have £0 balance and secondly is it wise to do this before applying to nationwide? Once these cards are paid off we do not want to use a credit card ever again (we havent used any credit since having a lightbulb moment this time last year) so we have proved to ourselves that we can live within our means and feel sooooo much better for it.

If anyone can advise me I would be grateful
Thanks

lisyloo

Call the lenders and cancel. Most do it over the phone and ask you to cut up the card.

is it wise to do this before applying to nationwide?

If you don't need the credt then yes it's wise.
There are many reasons to close cards including fraud, id theft, dormancy fees, accesss to new customer list and also after a few months reducing the available credit on your credit report although that won't happen immediately.

we do not want to use a credit card ever again

There are advantages to using cards in some cases.
Specifically - Section 75 protection can be valuable for some purchases. This would be really useful if say a holiday company or airline goes bust.
Some cards offer benefits like extended warranties or purchase protection.

From a money management perspective I understand wheree you are coming from and it's FAB to live within your means, but don't overlook the valuable protection. You'd be gutted if you lost thousands on a holiday.

[Deleted User]

Dormancy fees? I didn't know about these. Presumably the card has to have been dormant for a number of years?

lisyloo

Dormancy fees? I didn't know about these. Presumably the card has to have been dormant for a number of years?

There is no set rule, any company can definie it's own terms and conditions and CHANGE them giving you appropriate notice of course.
So for example a company you invoke a £20 dormancy fee for 6 months of no-use to encourage people to close their cards (some have this).
Of course they need to inform you of any change in Ts&Cs but how many people actually read the small print they are sent through the post - very few I suspect.

I don't think this is the biggest issue.
A bigger issue is that if you aren't checking statement (or even the prescence of your card if it's in a drawer) then fraud can build up before you notice. In most cases this would be when you receive a statement but if you don't get paper statements or forgot to change your address it could be longer.

Personally I always close cards I'm not using as soon as I stop using them but that has to be balanced against not needing the line of credit anymore.

I see every card and every piece of data on a computer as a potential fraud and id theft threat, but of course there are great advantages to using cards.
I jsut don't keep any unnecessarily.

TOOMUCHWORRY

Thank you for your replies.

I am going to dig out all the dormant cc's and start phoning to cancel.
At least then I can prevent fraudulent use of our accounts. I did not know about possible dormant charges either.

Many thanks.

exel1966

TOOMUCHWORRY wrote: »

Over the years myself and my husband have taken out various credit cards to take advantage of 0% balance transfers. We are currently using one each to pay of our debts : mine barclaycard £1500 and my husband virgin card £4000. These are currently at 0% but are due to expire in December and March respectively. I am thinking of applying for Nationwide 20 months at 0% in the next couple of months and transferring both outstanding balances to this. Firstly, how do we go about cancelling our other cards which all have £0 balance and secondly is it wise to do this before applying to nationwide? Once these cards are paid off we do not want to use a credit card ever again (we havent used any credit since having a lightbulb moment this time last year) so we have proved to ourselves that we can live within our means and feel sooooo much better for it.

If anyone can advise me I would be grateful
Thanks

Cancel your unused cards over the phone NOW. Each company should confirm in writing that the accounts have been closed. It usually takes the CRA's up to two months to update credit files, therefore come November when you apply for the Nationwide card they will see a lot less available credit to you which may help you get the limit you require for the two BT's, though that's not certain.

Not using credit is unwise and could hinder future credit card applications/loans etc. Lenders like to see a 0-24 month history of an applicants ability to repay finance. Spend within your means but only occasionally use the card if it's a problem to you. You should look at cards in a postive light, cards are not evil. There are many more positives to having them than negatives.

TOOMUCHWORRY

exel1966 wrote: »

Cancel your unused cards over the phone NOW. Each company should confirm in writing that the accounts have been closed. It usually takes the CRA's up to two months to update credit files, therefore come November when you apply for the Nationwide card they will see a lot less available credit to you which may help you get the limit you require for the two BT's, though that's not certain.

Not using credit is unwise and could hinder future credit card applications/loans etc. Lenders like to see a 0-24 month history of an applicants ability to repay finance. Spend within your means but only occasionally use the card if it's a problem to you. You should look at cards in a postive light, cards are not evil. There are many more positives to having them than negatives.

Thanks for your advice. I completely understand what you are saying about using cards but I have always used them incorrectly and I am scared of running up debt again. I will have to practise using them and paying them off at the end of each month,

lisyloo

Another potential reason or having a credit is booking hotels, emergencies abroad and booking car hire.

Car hire comapnies and some hotels want to put a "reserve" on your card.
This is in case of damage.
There are ways round this for hotels, but in the case of car hire you may find it extremely difficult to operate without a credit card.

As already said good management of credit provides good history on your credit report.

I have always used them incorrectly

If you got food poisoning would you give up food? :-)

Understand your reasons but don't overlook all the advantages already mentioned.

Also some benefits (like extended warranties or cashback) can be valuable.

System

As an aside, Nationwide allow you to do a quotation search before the full credit check so you can get an idea of whether or not you are likely to be accepted before putting a credit search on your credit file.

Regards
UNDERGROUND

TOOMUCHWORRY

Thank you for all your replies. They have all helped me a great deal.