Credit Card, Close or Keep Open?

CraigAbdn

Hello,

I took out a Virgin Credit Card last year, within a few months I had pretty much maxed it out, im now in a position where I have been able to pay off the 5k on it. Question is should i now close it or keep it open for a few months to use it properly ie pay off full amount each month, would it look better on my credit file to have a few months of using it properly prior to closing or does it not matter, can the damage of having it maxed out for a year not be undone?

Cheers.

fozmcfc

As far as the card is concerned, I would keep it open.

Virgin offer many customers repeat offers on 0% balance and money transfers and occasionally on purchases. There was hardly a month went by when I did have an offer available to me and many others have posted similar on this forums.

The main advantage of the card, is if you get 0% offers for transfers, it allows money transfers to a bank account for a small fee, which is normally 4%. Then you have xx amount of months to clear the balance before the 0% runs out.

That means you can purchase something, then transfer the money to your bank account to cover it. For instance, buy something for £1000, transfer £1000 to your bank account from the card. The card balance is then £1040 and you have xx amount of months to pay it back without interest, providing you at least pay the minimum amount due each month.

However, if like this time, you will max the card out and have trouble paying it back, then I would close it, to save temptation.