Closing my credit card accounts

JJM236

Hi MSE community.
I have a 5 credit cards with a combined limit of about £50,000.
I only use one that gets paid off in full monthly so total balance is generally about £2000.
With this in mind, should I close the other accounts or is it good to have it available and a low credit utilisation?
Thank you,

Josh

dr_adidas01

JJM236 said:

Hi MSE community.
I have a 5 credit cards with a combined limit of about £50,000.
I only use one that gets paid off in full monthly so total balance is generally about £2000.
With this in mind, should I close the other accounts or is it good to have it available and a low credit utilisation?
Thank you,

Josh

It’s best to keep them open especially at the moment where lenders are being more strict with there lending criteria due to coronavirus and the current economic uncertainty. 

It would be advisable to use all your credit cards once a month even for a small purchase just to keep them active and pay them in full. 

As for utilisation as long as your paying them in full it won’t matter how much you use, as it will show on your credit files that you use X amount and payed the full X amount when the statement balance was due. 

cymruchris

Additionally - where are you in terms of mortgages? Will you be needing one any time soon? Do you not have one, and will never have one? If you have any planned large financial applications to make over the next year or so - it's best to keep them open as a sign that lenders trust you with the limits you have. If you're done with finance - and won't ever need another mortgage, there'd be no harm in closing a couple of cards down if you don't see yourself ever needing that much credit again. The answer really needs to be tailored to your personal circumstances rather than just simply I have £X credit limit - should I close down some cards. Give a bit more context and the advice can be a little more specific then  

phillw

I use old credit cards with one purchase a month as DD for current accounts that reward with cash....

yksi

You didn't mention your income. If you're planning on a mortgage anytime soon, having a very large available credit limit in comparison to your income might go against you. I wouldn't reduce the limits individually because it might look as if the lender was the one doing the limit reduction, but if you're not earning a lot of money then you might want to close some to cut the overall limit back to somewhere close to your annual income. I've seen several people in here say they had no problem getting mortgages with CC limits 3x their income, but in my case it was only just over my income and two seperate major lenders told me my access to (unused) unsecured credit was the reason I was rejected.