Reducing credit limit damaging chances of credit??

cjmurray

Hi all!

I'm finally living within my means and have 4 credit cards left to pay off. I don't make any purchases on any of them. One has quite a hefty balance on it and the other 3 have "low lifetime APR" deals on them. My current system to pay these off involves paying the minimum balance on all cards each month, and then as much extra off the card with the worst APR as I can afford.

I wish to also reduce the rate on the highest APR card (works out as around 11%), but I do get knocked back when applying for new cards on the grounds of being over-committed.

I think part of the problem may be that on the 3 cards that I'm only paying the minimum balance, I frequently reduce the credit limit so that it just covers the current balance plus a month's interest.

Can anyone confirm whether this would affect a card issuer's decision on me being over-committed? What looks 'worse' to them:
1. Having a high amount of total credit available to me?
or 2. The fact that I've used up 99% of the credit that I have available?

Many thanks!
Chris

jay78

cjmurray wrote: »

Hi all!

I'm finally living within my means and have 4 credit cards left to pay off. I don't make any purchases on any of them. One has quite a hefty balance on it and the other 3 have "low lifetime APR" deals on them. My current system to pay these off involves paying the minimum balance on all cards each month, and then as much extra off the card with the worst APR as I can afford.

This is good practice.

Can anyone confirm whether this would affect a card issuer's decision on me being over-committed? What looks 'worse' to them:
1. Having a high amount of total credit available to me?
or 2. The fact that I've used up 99% of the credit that I have available?

Many thanks!
Chris

There has been a lot of discussion about this on the website, but honestly both of them can been seen as negatives. Obviously if you do have a high amount of credit available as well as being maxed-out on them doesn't look good, it looks as if you are struggling. Incidently what percentage of your income do you have on credit cards? If you have been turned down for cards and they have said it's because of over-commitment then you have your answer.