does having other credit cards affect applications?

Etccarmageddon

I have 4 credit cards. One with a credit limit of around £10k which I spend up to £2k on and pay off fully each month. And another with a limit of £3k which I also pay off each month.

A couple of others with balance transfers totalling around £10k on 0% offers.

One of those balance transfers is coming to an end in around 3 months - so my plan is to apply for another balance transfer card and move it to that.

In order to improve my chances of getting that card which I think will be a barclaycard, should I close the £10k limit card - does having that card even though I don't go anywhere near the limit make the credit card companies likely to decline applications or give me a reduced credit limit?

your advice is appreciated.

[Deleted User]

It depends.

You need to balance debt to limits ratios, as well as limits to income ratio.

Etccarmageddon

Deleted_User wrote: »

It depends.

You need to balance debt to limits ratios, as well as limits to income ratio.

I'm sorry, I haven't got a clue what that means!

MallyGirl

if your available credit limits sum to more than half your gross salary you might start to struggle getting additional credit.

on the other hand if you close the big empty card your percentage of credit used (balance vs credit limit) will increase across the remaining ones - and this can also make you looked upon less favourably.

Hence the need to balance these 2 factors

Etccarmageddon

thank you, I will think about getting rid of that card with the massive credit limit as it might look like I already have too much available credit.

agrinnall

Etccarmageddon wrote: »

...does having that card even though I don't go anywhere near the limit make the credit card companies likely to decline applications or give me a reduced credit limit?

The answer to this is yes. Each card issuer will use the information in your application and from other sources to calculate your overall credit worthiness, and if your existing available credit limit is near, at or over that figure then they will either decline to offer you a card or set a limit that won't take you over the total.

Getting rid of a £10K card will obviously give a lot more leeway in what can be offered by a new issuer, although I don't know how long you will need to wait for that to be reflected by the relevant CRAs.

Etccarmageddon

cheers, much appreciated

Nebulous2

I've never believed in this. I've had in excess of my salary in available credit for at least 20 years. Often it's been over twice my salary. I'm not very good at closing cards, stopping spending on them but leaving them open.

After finding my way on here I closed a couple including MBNA which had my highest ever limit. That brought my total down. It is now creeping up again though.

This weekend I've reapplied to MBNA for a money transfer and I've been given an £11k limit, which takes me above twice my salary again.

So my experience has been that available credit doesn't affect limits or acceptance- and may even help it.

HarlowC

People who don't use much of their available credit are considered much less risky borrowers than those who are near their credit limits

Debt to limit ratio should should never be above 30% and ideally should be always under 10%

Ben8282

Do not under any circumstances get rid of the £10k card or reduce the credit limit.
If you spend around 2k pm on this card and (presumably) pay by direct debit your actual balance will probably get up to about 3.5k before the DD is taken. Remember that it is not the statement balance which is taken into consideration by lenders but the 'balance' reported on the day that lenders report. You may well find that the 'balance' being reported each month is almost twice your monthly spend. A 3.5k balance on a 10k limit card is 35% utilisation. In order to keep the utilisation % down, you need a large unused amount available within your credit limit.
In addition, lenders will take existing high credit limit into consideration when deciding on the credit limit to be given. If you have high limit cards (and to be honest 10k is not really a high limit), you will be seen as a 'high limit' kind of person. If all your limits are low, then you will be seen as a 'low limit' kind of person.
Personally I am not convinced about the idea that the total of a persons credit limits should not exceed half of their salary. I would wait until you see some evidence that this is causing you problems before you take any action based on this assumption.
You say that you will need to do this balance transfer in about 3 months time.
In your position I would immediately do everything possible to reduce the balances reported. That means getting the balances as low as possible on the day of the month that the lenders report the balance. I agree with HarlowC above about the debt to limit ratio. You said that you don't understand this but it is easy to explain. If the total of your credit limits is 20k and your total balances 10k, your debt to limit ratio would be 50%. To work out your ratio, add up your total balances and divide them by the total of your credit limits.
Apart from that, there is not much that you can do apart from using an eligibility checker and applying for the best card that you have a good chance of being accepted for.
And good luck ...

Dobbibill

Does your card with a £10k limit not have a BT offer?
May be worth giving them a call to ask and rotating CC usage to suit your needs, rather than applying for more.

Some cards do BT offers more frequently than others. I know BC are always offering BT deals to existing customers when the balance drops.