Multiple cards, no balance

MaxiMum_3

Over time, I have amassed quite a wealth of cards / overdrafts with varying rates of interest. This was to take advantage of offers at the time and I have just not cancelled the cards / closed the accounts. The credit cards are almost always paid in full and one overdraft is sometimes taken advantage of for short periods of time.

Does it make sense to just identify one or two of the best ones and then cancel all the rest, or just leave them all open? I don't forsee needing them and if I did I would like to be able to re-apply. Also sometimes, they send through special offers, which I take advantage of. My credit rating is excellent.

In summary, this is what I have - all have standard interest rates

Credit card - Limit
MBNA Platinum Visa - £10,000
Alliance & Leicester Visa -£5,000
Nationwide Gold Visa - £5,200
Sainsburys Bank Visa - £7,300
Barclaycard Platinum Visa - £3,500
Cahoot Visa - £6,000
HSBC Mastercard - £4,500
NatWest Mastercard - £4,700

Overdraft - Limit - Rate
HSBC - £1,250 - >20%
NatWest - £2,250 - >20%
Alliance & Leicester - £1,300 - <10%
Cahoot - £2,000 - <10%

I am currently using less than £300 of my Cahoot overdraft and I am trying to spend on my NatWest Mastercard as there is an introductory cashback offer of 2% on purchases. I spend about £1300 per month on credit card but will pay it off fully each month.

any advice would be appreciated...otherwise I will just leave things as they are now

Mozette

Well as you clearly don't have a problem, and you already get offers to take advantage of, I'd leave well alone. Though you might find some of the providers reduce your limits out of the blue.

PBA

Having lots of available credit that you don't use can certainly count against you. At the moment you've got £46,200 of credit limits available that you don't use. If you wanted to apply for a new card the lender would certainly take that into account. I'd say HSBC and Barclaycard are certainly worth getting rid of, as when they bring out special offers existing cardholders are usually excluded. The others are up to you, but I'd certainly get rid of all but 1 or 2, and then make sure you spend something on the ones you keep each month so your credit file shows that they're being used.

Moggles_2

If you take no action, the cards show on your credit file as available credit. Depending on your income, this doesn't necessarily affect your chances of acceptance by other card companies, but it may influence the credit limit you're likely to be offered.

A phone call to customer services should be all that's required, but best practice is to ask the lender to confirm closure in writing

If the promised confirmation letter does not arrive within a couple of weeks, phone once again to ask why.

Finally, if your credit reports do not show the card(s) in question as "settled" contact the lender(s) once again and ask them to make the necessary changes.

The whole process (from the initial phone call ) can sometimes span a couple of months, so allow plenty of time.

Moggles_2

Another good reason to cancel your unused credit cards is that occasionally you're offered an incentive to stay

sujman

I seem to recall reading one of Martins articles where he advises that having cards with credit limits you don't use can work to your advantage (as long as you cut them up and never use them).

As a previous poster said, the total of all your credit limits will be viewed as you having plenty of available credit which can be then interpreted as you being a lower risk and therefore worthy of further credit (just as the rich - the people who dont need credit - find it easier to get cheap rates versus those that don't have credit and pay high rates)

For example, someone who has one card, credit limit of £1,000 and a balance of £900 pounds on the card indicates that they have streched their credit to 90% of what they have available.

In your case, if you had the same £900 pounds outstanding but with £40k+ worth of credit, you would be using only 2.25% of your credit, making you more of an attractive risk.

So in summary, perhaps keep the spare cards, just cut them up and dispose so you're never tempted to use them.

exel1966

The availbale credit you have access to will have a massive effect on any further credit you wish to obtain. You're more than likely to get lower limits than you currently have or maybe even possibly be declined.
It's just as important not to have too much available credit as it is to have spent what you do have.
I would say dispose of most of the cards and just hold a couple back. Keeping spare cards and cutting them up so you don't use them is absolutely pointless as the cards will still be active and possibly hampering further credit. It will also stop you being able to take advantage of new customer deals.