To close or not to close?

114 Posts
in Credit Cards
I have often read on here, that it is hard to strike the balance as to what to do with unused cards. On the one hand, I have a lot of unused cards, but on the other hand I do currently have a utilisaion of 47% and obviously closing some cards, will increase this utilisation. Furthermore, a lot of my unused cards are quite old, showing some stability. Am playing the balance transfer game, hence the top heaviness amongst cards
What cards, if any do people think I should close looking at below current state of affairs?
Card / Balance / Limit / Age
Aqua / £0 / £4950 / 8 yrs
Vanquis / £0 / £3000 / 12 yrs
Tesco 1 / £2857 / £3250 / 1 yr
Tesco 2 / £2800 / £2800 / 2 months
MBNA / £5182 / £5400 / 1 yr
MBNA 2 / £2585 / £3000 / 1 yr
Capital One / £0 / £2500 / 7 yrs
Santander / £0 / £3700 / 3 yrs
M & S / £143 / £5500 / 4 yrs
Barclaycard / £2687 / £2900 /4 yrs
Any advice welcome.
What cards, if any do people think I should close looking at below current state of affairs?
Card / Balance / Limit / Age
Aqua / £0 / £4950 / 8 yrs
Vanquis / £0 / £3000 / 12 yrs
Tesco 1 / £2857 / £3250 / 1 yr
Tesco 2 / £2800 / £2800 / 2 months
MBNA / £5182 / £5400 / 1 yr
MBNA 2 / £2585 / £3000 / 1 yr
Capital One / £0 / £2500 / 7 yrs
Santander / £0 / £3700 / 3 yrs
M & S / £143 / £5500 / 4 yrs
Barclaycard / £2687 / £2900 /4 yrs
Any advice welcome.
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Replies
As you say, there's a balance to be struck, in that you currently have access to £30K+ of credit, and, unless you're particularly well paid, that could cause issues when prospective lenders consider affordability.
What are the APRs of each card and if any are 0%, when do they expire?
And what are your plans to repay these debts, i.e. are you expecting a decent lump sum in the near future or are you hoping to continue to shuffle the debt around?
Well for some of the sub-prime cards, the APR's are very high. For all the others, range between 16-19%. All the ones with a balance apart from M&S are currently on BT and I plan to keep shuffling them., chipping away where I can. The expirys range from Feb 19 to June 21
My main worry is I am looking to re-mortgage in about a year so was wondering how the above and credit utilisation will affect my chances of that.
Of course it closing accounts down with high credit limits and applying for new ones is always a bit of a gamble i,ve done it closed a card down with 17k limit then got offered new one with 7k limit???? so up to you in the end.
Closing them and reducing available credit obviously increases utilisation ratio but improves affordability as measured by total credit v income.
In the context of remortgaging there are obviously a range of other parameters that are relevant, in terms of income, property value/equity, etc, so perhaps worth discussing your situation with a mortgage broker?
What you say makes sense, but Aqua and Vanquis are also cards that show a greater age, which I am led to believe increases stability as well as their generous limits. I have no intention of ever using them again due to their rates but keep them for the above reasons. Plus I am not sure if lenders can see the company names when they do their own checks
I will look into Virgin and Halifax though when some of my current ones expire.
Very true. It also makes sense why the credit club always says my affordability is weak.
I love my job
Ask MBNA if they can consolidate the 2 cards into one for a start.
Then do the same for Tesco.