Will Credit Card limit be dropped or Card cancelled?

Palonka

Hello,

Could anyone help? My situation is the following. I have unfortunately managed to get myself into quite a bit of debt. I have a £4k barclaycard that is maxed out, a £9k overdraft that is also maxed out and I recently applied for a credit card from one of the other main providers. I was given a card with an £8k limit. I made the big mistake of applying for a whole lot of credit cards at once, as I had no idea the damage this could inflict on my credit rating. The card mentioned above was my first application and the one that I was accepted for, all other applications were not accepted. This all happened around a month ago and my new card arrived a few days ago. My concern is that my credit rating has plummeted and is now shockingly bad, I have 10 applications, my score is 490 and about a week ago i missed a payment on my barclaycard, this hasnt shown up on my credit report but I expect it will. I dont have any CCJ's or anything really bad...

My concern is.... I expect to be paid a large sum that is owed to me by July ( i could eradicate all debt) and before that I have some pretty large expenses that I will need to cover and the full £8k will be required. My concern is that my new credit card company will pull a soft request and inspect my report and either cut my limit or cancel my card because they see me as too much of a potential risk, does anyone think this could be likely considering my position and that when my credit report updates it will be worse than it is now... I have also been offered a very good deal on a balance transfer from my barclaycard to my new card, but my concern is that apparently every time a balance transfer is done, that company will do a routine credit check. If I lose the use of this card I will be in a very dire situation and I simply cannot take the risk.

Thankyou in advance for any advice

P.

grumbler

Palonka wrote: »

Hello,

Could anyone help? My situation is the following. I have unfortunately managed to get myself into quite a bit of debt. I have a £4k barclaycard that is maxed out, a £9k overdraft that is also maxed out and I recently applied for a credit card from one of the other main providers. I was given a card with an £8k limit.
I made the big mistake of applying for a whole lot of credit cards at once, as I had no idea the damage this could inflict on my credit rating.

This is mainly because you already have £21K credit available, not because of the number of applications. You are extremely unlikely to get any more credit even in a few months.

The card mentioned above was my first application and the one that I was accepted for, all other applications were not accepted. This all happened around a month ago and my new card arrived a few days ago. My concern is that my credit rating has plummeted and is now shockingly bad, I have 10 applications, my score is 490 and about a week ago i missed a payment on my barclaycard, this hasnt shown up on my credit report but I expect it will. I dont have any CCJ's or anything really bad...

My concern is.... I expect to be paid a large sum that is owed to me by July ( i could eradicate all debt) and before that I have some pretty large expenses that I will need to cover and the full £8k will be required. My concern is that my new credit card company will pull a soft request and inspect my report and either cut my limit or cancel my card because they see me as too much of a potential risk, does anyone think this could be likely considering my position and that when my credit report updates it will be worse than it is now...

Well, if you keep missing payments everything is possible.

I have also been offered a very good deal on a balance transfer from my barclaycard to my new card, but my concern is that apparently every time a balance transfer is done, that company will do a routine credit check.

I don't think so as this doesn't affect your credit limit.

If I lose the use of this card I will be in a very dire situation and I simply cannot take the risk.

You are already taking it by planning 'large expenses', paying high interest on them and relying on money that you may or may not get in July.

Palonka

Thanks for your response grumbler. Could you let me know whether you think this may happen if I did not miss anymore payments or make any more mistakes? Unfortunately I need to spend this money as my business is dependent on it and I fear it may collapse if I do not have access to this credit.

grumbler

I think using personal credit cards for financing business is a bad idea and most likely against the CC T&C.

dalesrider

Palonka wrote: »

I need to spend this money as my business is dependent on it and I fear it may collapse if I do not have access to this credit.

So you are using a personal credit facility to fund a business...... As above very dangerous ground to be on. Which could see the facility pulled.

I expect to be paid a large sum that is owed to me by July ( i could eradicate all debt)

Would this be a debt someone owes the business???

How do you know that the money will be paid on time... And you won't get a sob story.
Which leaves you up the creak without a paddle.

Perhaps you need to have a long hard discussion with your accountant and business manager at the bank.
Before you saddle yourself with a debt, that could not only destroy your business, but also your personal finances.

Palonka

Ok, I will simply shut down then and tell my two employees they no longer have a job. Thankyou for your concern.

Palonka

Thanks for your response Dalesrider. The above was in response to Grumbler who seems very unsympathetic.

The money is owed to me by a family member and it is extremely unlikely that I will not be paid.

The question that I would really appreciate answered is assuming what I have mentioned above that I will not default on anymore payments and also assuming that the transactions made on the card will certainly not appear to be business transactions, do you think it is possible that my card provider will do a soft check on my report, see that my financial situation has got much worse and then decide to cancel the card or drop my limit?

Thanks

grumbler

Most providers do regular checks regardless.
If the card is maxed up, they can't do much except increasing the rate (that you can reject) and stop you from further spending.
IMO, your best way of acting is to transfer the balances to the new card and spend on the old ones.
However, IMO it's really crazy to use cash withdrawals from CCs to plug holes in your business.

Palonka

Thankyou, that is what I was thinking would be a good idea, but as I mentioned above. I have heard that they run a whole lot of checks before doing balance transfers and if they do this, realise that there are issues, they may decide to not do the balance transfer and also to drop the credit limit to my balance or/and cancel the card. What do you think? Is it worth taking the risk of the balance transfer?

grumbler

Nobody can guarantee you anything, bot IMO it makes no sense to give you some limit, offer some deal on BT and then make another check to make the transfer. Beware that it's usually can be up to 90% of the limit, not 100%.

Gurranes

I would think it unlikely that there will be any credit searches done while doing a balance transfer, providing you don't go beyond 90% of your limit and therefore require further credit.

What might show up and force action by them would be any arrears with other providers. They will get a monthly feed of your credit profile as standard, which the arrears will appear on (depending on timing of how quickly you brought it up to date).