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Clearing credit card effect on credit rating

11 Posts
Afternoon
I have just consolidated large credit cards debts, so paid off £50k across 5 cards.
Credit limits are:
Card 1 £11000
Card 2 £6000
Card 3 £10700
Card 4 £16400
Card 5 £16500
So around £60000 worth of credit.
I left a few hundred pounds on each card just to cover any left interest / planned minimum payments.
My issue is I have just been refused credit on a PCP card loan, the excuse was something like close to my full credit capacity.
My concern is that I have acted stupidly in clearing cards and it might negatively affect my credit rating (I see the comments regarding ratings not existing - so simply mean the ability to get a pcp deal).
Any thoughts on what effect clearing these cards will have to my credit position, and is it in my interest to encourage my card companies to speak Experian ? assuming that is heavily reduced balances will help my credit rating.
Thanks in advance.
I have just consolidated large credit cards debts, so paid off £50k across 5 cards.
Credit limits are:
Card 1 £11000
Card 2 £6000
Card 3 £10700
Card 4 £16400
Card 5 £16500
So around £60000 worth of credit.
I left a few hundred pounds on each card just to cover any left interest / planned minimum payments.
My issue is I have just been refused credit on a PCP card loan, the excuse was something like close to my full credit capacity.
My concern is that I have acted stupidly in clearing cards and it might negatively affect my credit rating (I see the comments regarding ratings not existing - so simply mean the ability to get a pcp deal).
Any thoughts on what effect clearing these cards will have to my credit position, and is it in my interest to encourage my card companies to speak Experian ? assuming that is heavily reduced balances will help my credit rating.
Thanks in advance.
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Alternatively, it could be that your credit reports have not been updated with the credit card pay offs. So the lender might have seen you are in £60k worth of credit card debt AND £60k worth of unsecured personal loan debt. It can take 6-8 weeks for a credit account balance to be updated with the CRAs.
Sorry - I was not clear. I have £60000 available credit (combined credit limits), was previously around £10000 available as I had a combined £50000 balance (across 5 cards). The total balances now sit at around £1500 which I have left for now.
As around £32000 of the balance paid was across 2 Barclaycard's, is there anyway to persuade Barclaycard to contact Experien to update details. And will a picture of both cards more of less being paid off help my rating ?
My nett monthly income is £4200.
Thanks
The lender for whatever reason doesn't want you as a customer of theirs.
The CC's clearly aren't paid in full each month - I am guessing they are accruing interest as well each month?
Are there any defaults or late payment markers against any of them?
It sounds like there just hasn't been enough time for your credit report to update with the paid off balances. It could be worth calling the PCP lender and saying you have paid off the credit cards. Although they may still look at your situation and decide you are overexposed as you could potentially go out tomorrow and spend £60k on your credit cards and be £110k in debt. Consider closing the the cards you don't need....
Edit:
You can't speed up the credit reporting process.... so asking Barclaycard to update your details won't make a difference.
the cards were for some time only covered by minimum payments (up to now !) so yes interest was built up - but now paid off.
No defaults or late payments .
I was told they were making a decision using the Experian report so I guess I just have to wait for the card companies to update the credit file as there is no way to speed up the process.
Frustrating.
Thanks
Paying only the minimum and not being covered by a 0% promo offer will instantly set alarm bells ringing.
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