Advice on when to Apply for Criedt Card

davidmaiden18183

Hey all,

My Virgin Credit Card's 0% on Purchases has ended and I have paid it off. Balance is now £0 of £5500 available Credit.

I have an M&S Credit Card which has 0% purchases and is using about £3800 of a £4500 Credit limit.

I’ve slowly been spending on the M&S card to free my cash account up to clear the virgin card (thus avoiding a balance transfer fee to pay the card off)

Question is I now need to replace the virgin card with a new card with 0% on purchases. But am I best applying with the virgin card still open stating £0 of £5500 used on my credit report, or close it and wait until that shows on my credit report as settled.

If I apply now (without closing the virgin card) I’m worried it will they will see I already have fair credit limit on two cards already (not that one is being used), and they wont offer me much. However if I settle the virgin card and then apply I’m worried it will look like I am using a high percentage of available credit I have and that would reduce what I am offered.

I just want to apply at the right time to give me the highest possible available credit limit from a card provider.

Any advice or thoughts?

Thanks

guesswho2000

I wouldn't worry, as long as the rest of your CRA file is good. My total available credit limits were over £20k when I applied and was accepted for a Tesco CC last week.

I think utilisation (high balances to limits) would be a bigger issue, but whether they are concerned with the high balance to limit on one card or whether they take the balance to total limits is something I'm sure others can answer?

davidmaiden18183

guesswho2000 wrote: »

I wouldn't worry, as long as the rest of your CRA file is good. My total available credit limits were over £20k when I applied and was accepted for a Tesco CC last week.

I think utilisation (high balances to limits) would be a bigger issue, but whether they are concerned with the high balance to limit on one card or whether they take the balance to total limits is something I'm sure others can answer?

So if utilisation is lets say the biggest issue then really I am best applying not closing the virgin card. I just am concious it may be taking up available credit someone else may offer me.

I was told that providers generally will not give you credit if your available credit (being used or not) accross providers is around half your salary. My salary is around 30k.

msallen

davidmaiden18183 wrote: »

I was told that providers generally will not give you credit if your available credit (being used or not) accross providers is around half your salary. My salary is around 30k.

I'm sure all providers are different, but Tesco gave me a new 0% card a few weeks ago when I had approx 50K of total credit limits and a salary of 40K. (Admittedly circa 25K of that limit was on cards that I had rejected rate hikes on and are closed to new spend, but that fact doesn't appear on your credit report)

tink_1983

Wouldnt a balance transfer offer be better for you, so you can pay off balance gradually without running up purchases on another card? Just a suggestion, but mbna just gave me a card with like 15months 0% on bt.
Oh and i have like 4 cards, aslong as used credit is low seems they dont mind, sister has 6 credit cards!

fozmcfc

Couple of things.

Virgin in my experience are very good at giving repeat offers on balance transfers/money transfers and occasionally purchases. In each case for 12 months.

So in effect, you could get a 12 month loan and pay £40 per £1000 transferred into a bank account in the case of a money transfer. Or £35 per £1000 on a balance transfer.

Because of these constant repeat offers (I have 2 available, after 2 have just expired for instance) I have kept my card.

Secondly, I've had a Virgin card, Tesco, Halifax and M&S card all on 0% purchases over the past 3.5 years. I had £25k of credit available to me on a £30k salary.

Just applied for another 0% card, this time from Lloyds and been accepted with a £5k limit, thus £30k available on £30k salary.

So as others have said, if you have a great credit rating with absolutely no blemishes, you don't have to always close a card down first.

And in my experience if you ever feel you may need to borrow a £1000 + for 12 months and pay only 4% APR, it's worth holding onto the Virgin card.

sfax

If you close the Virgin card you'll be left with a high debt to credit limit ratio of about 85% which might be a problem. You could leave it open but get the limit reduced but I'm not sure how much this will help.

You will probably get 2 lives on credit applications before the number of credit searches acts against you and then you'll probably have to wait 6 months before applying again.

Personally, I would apply now and:

1. if you get rejected, try reducing the limit on the other card (or even closing it), waiting for this to appear on your credit reports and then apply again

2. if you are successful but get a limit that is too low, you can then reduce the limit on your other card and ask the new card issuer to review your limit once the change registers on your credit reports

If it was me and I got accepted for one card with a limit less than I wanted, I would immediately apply for a second card (before the first new card registers on your credit reports)

sfax

sfax wrote: »

If it was me and I got accepted for one card with a limit less than I wanted, I would immediately apply for a second card (before the first new card registers on your credit reports)

Incidentally, this last part isn't just guess work. I have 5 credit cards with a total limit of about £35k and recently made 2 back to back applications (both successful) when switching between 0% BT deals