Mortgage and Credit Cards

hunte78

Hi all,

We are currently looking at our options for a mortgage. We are waiting until the new year as the marketh as slowed in our area, this should give us some time to ensure that no frivolous expenditure goes through our current accounts. However I have a general question about credit cards. I have 8 credit cards, all open and all with a zero balance, the total credit available across the cards is £34,500. Should I be looking to close some of these cards, or is it in my interest to keep them open?

TIA

jaelato1

Why have open 8 open CC? I'll close some down although I doubt it would impact your application when you do decide for apply for mortgage.

Thrugelmir

hunte78 wrote: »

is it in my interest to keep them open?

For what purpose?

hunte78

Thanks for the replies. To be honest I am a complete amateur when it comes to this.

There's no real reason why I have 8 cards other than the fact that I have had numerous BT cards, but have since paid them off and just never got around to closing them down.

Thrugelmir - I have then read stuff on MSE about it being good to show that you are not fully utilising your available credit so it benefits you more - although I am probably way off the mark with that.

As I say, hopefully in the new year we will be applying for a mortgage, we have a current DIP but plan to tidy up our account before seriously applying. Our credit files look pretty strong, no defaults or missed payments. My wife could maybe do with getting some kind of other credit source as she has old credit cards that haven't been used in years so doesn't show current credit management (MSE credit club report shows this as an amber warning) but we don't want to go down that route putting another credit search on file if it isn't necessary.

Thrugelmir

hunte78 wrote: »

Thrugelmir - I have then read stuff on MSE about it being good to show that you are not fully utilising your available credit so it benefits you more - although I am probably way off the mark with that.

I'm in the camp of keep what you actually need. Good housekeeping in closing what you don't. Having a large unutilised credit line raises more questions than answers. Makes credit file far cleaner.

Nebulous2

Are you using a broker? If so ask them.

Lenders don't like change. I wouldn't mess about with accounts close to an application, without being told the benefits would outweigh the disadvantages.

I'm not good at closing credit cards, also had 8 until about 4 months ago, when I closed 2.

Thrugelmir

Nebulous2 wrote: »

Lenders don't like change.

CRA's report sudden changes on a credit file as a negative factor. As they don't know the reason behind it. After a couple of months has passed and nothing untoward is subsequently reported. The credit file returns to normal.

hunte78

Thanks again for the advice.

I think I will look at closing a few of the cards this month, hopefully by the time we look at purchasing then any negative impact will have rebalanced. I certainly don't want lenders worrying about how much unsecured credit I have access to.

Sibz

I see where you are coming from - having longer credit associations can also be positive on your record. Alongside what you're saying about amount of utilized credit.

Best to discuss with your mortgage broker/FA I'd imagine as they're dealing with these things regularly.

csgohan4

more bank accounts/ credit cards means more risk for identity fraud