Which is worse - high available credit or high ratio of debt to available credit?

ilikewatch

I'm guessing that the answer is going to be that there is no "one size fits all" and that each potential creditor views your circumstances according to their own, individual criteria...

Anyway I currently have 4 credit/store cards with a total available credit of £5K, and about 1.4K of debt being paid off interest free on one of the cards.

Looking to apply for another BT card in a few months and wondering if it would have a positive/negative/undetermined effect to close down some of my existing lines of credit.

i.e. can it be said that "in general" a potential lender would "prefer" to see:
Available credit of 5K with debt of 1.4K (28% exposure)
or
Available credit of 1.5K with debt of 1.4K (93% exposure)

I appreciate that many other factors are in play, such as the affordability of the available credit against my income/expenditure etc.

[Deleted User]

I'd say they'd generally prefer the former, but that's based on your specific example.

ilikewatch

Deleted_User wrote: »

I'd say they'd generally prefer the former, but that's based on your specific example.

Thanks, that broadly echoes my guess that the algorithm probably looks at "spare" income against total available credit to determine a potential credit limit, then probably looks for a lower percentage of exposure to determine how responsible you have been with your current borrowing - maybe generally preferring under 40% exposure or something like that?

[Deleted User]

Under 40% sounds a good figure. Someone already being maxed out is a concern for future lenders.