Halifax reducing overdraft

1884

I have received a letter from Halifax informing me that they will be reducing my overdraft from £2000 to £400 in the middle of February. I have not used my overdraft in 5+ years since my university days however I am worried that this might impact my credit rating as I think that your unused credit capacity is considered? I am looking to buy my first house this year and therefore my credit score is something I have been trying to get as high as possible in recent months.

The letter also says "If you expect to start using your overdraft more in the future, please call us on the number below. ... If you'd like to talk to us about your borrowing needs you can call x. If you'd like us to reconsider our decision we will treat this as a new application but your credit score will not be affected"

In terms of my credit limit as a whole, I have this £2000 overdraft + £500 overdraft on another bank account + £4,500 credit card + £8,300 credit card + £500 credit card.

Any advice would be greatly appreciated. Thank you

eskbanker

As is frequently pointed out on here, credit scores are essentially made up numbers that aren't seen by lenders, so there's no point in obsessing about them.

Perhaps your 'score' may be affected by having less available credit, but the actual debt you have at any point is likely to be more significant when considering a mortgage - either way round, if you don't need the larger overdraft facility then I wouldn't go looking for it to be reinstated if you're considering doing so solely for the purposes of how your credit files may appear.

born_again

Look on it as a bonus.
You are not going to be paying as much interest if you use it.

Why have a overdraft if you have not used it for 5+ years? Then why think it is going to effect your credit report?