3 credit cards,what shall i do?

thares07

I currently have 3 credit cards with 3 different company's. They have 3 different credit limits one has 5700,another 4300 and last 4800. The last one I've just been advised will be increased to 7800 at end off me month. Shall I let the increases happen or keep them lower (what helps with getting other credit?). We have been trying to get a loan for an extension for past year,we keep getting denied but these company keeps putting up credit on cards. Can someoneexplain how tthis works also please.

grumbler

The way it works is as a rule of thumb two ratios have to remain below ~50%:
(total credit available)/(income)
(total credit used)/(total credit available)

As you can see higher credit limit has contradictory effect on these two ratios - depending on other factors.

MrJester

grumbler wrote: »

The way it works is as a rule of thumb two ratios have to remain below ~50%:
(total credit available)/(income)
(total credit used)/(total credit available)

As you can see higher credit limit has contradictory effect on these two ratios - depending on other factors.

Interesting rule of thumb. Is 'income' per annum?

grumbler

Yes..........

thares07

What would be the best thing for me to do. I don't used the credit cards so don't see why they would keep upping them or to the point in me having them as the available credit is having an adverse effect.

thares07

Or would I be a negative to lower them.

Candyapple

thares07 wrote: »

What would be the best thing for me to do. I don't used the credit cards so don't see why they would keep upping them or to the point in me having them as the available credit is having an adverse effect.

If you have no need for them - close them. Or perhaps keep one and lower the limit, assuming that all 3 cards are empty and don't have balances on them?

As you've found out, too much available credit is detrimental to obtaining further credit (being declined for loan).

The reason the card companies keep upping the limits is because they hope you will start to spend on them and incur interest, thus making them money.

If you close any/all of the cards, wait at least 3 months and obtain copies of your credit reports to make sure that the accounts are showing in the settled section of your accounts.