Should I keep cleared down 0% balance transfer cards active after use?

Over the past 5 years I've made use of two balance transfer cards. The first I cleared down some time ago but left it active with £0 balance for months. My current one is coming to an end and I'm about to clear it down before the 0% period ends. Am wondering if its a good idea to close the accounts or just keep them active with the odd grocery purchase once a month?

I already have three other daily credit cards which I used on a more regular basis because they give better rewards returns, so other than the balance transfer cards allowing me a few extra thousand pounds worth of credit to hand - is there any point to keeping these two cards active?

I'm worried having too many credit cards (even if all in good shape) may not look great on a credit file, particularly as I recently had a request for the Santander balance transfer card declined, even though I have excellent credit history and no missed payments ever. The only reason I could imagine would be a) the original card was inactive or b) they could see I had another balance transfer card being paid down.

Replies

  • Card application could well simply be the current climate, BT cards are usually marked as a promotional rate and/or if you are not just paying the minimum so won't necessarily result in an automatic decline.

    It might be worth keeping one open for future BT offers and continuing to use it as credit utilisation will be much lower. Depends also on salary and how much the limits are on the cards
  • edited 3 March 2021 at 11:45AM
    skyscraper101skyscraper101 Forumite
    27 Posts
    Tenth Anniversary 10 Posts Combo Breaker
    Forumite
    edited 3 March 2021 at 11:45AM
    Card application could well simply be the current climate, BT cards are usually marked as a promotional rate and/or if you are not just paying the minimum so won't necessarily result in an automatic decline.

    It might be worth keeping one open for future BT offers and continuing to use it as credit utilisation will be much lower. Depends also on salary and how much the limits are on the cards
    Yeah I've kept the first one (Virgin Money) open, but realized when I checked Experian it noted it was 'inactive' (even though my score was near excellent), so I've taken to making a small purchase every month and paying off in full just to make it 'active again. 

    The second MBNA one, am about to pay down completely and I'm thinking to do the same, just in case I need to BT again and it'll save having to sign up (and possibly get declined).

    I was just wondering if this is 'bad practice' just having lots of cards on hand. My instinct says to keep as many lines of credit open as possible and all in good shape, but perhaps creditors view this differently if they can see someone with multiple cards paying them down every month (i.e. not making much money at all out of me).

  • It's a myth that card companies don't make money from you even if you pay in full, they get fees every time you spend on the card. You'll find lots of people on here have multiple cards, I have 4 as it happens, 2 normal, 2 BT, 2 are paid in full every month, the BT ones are paid at a fixed DD to clear down by the end of the period. CRAs say that credit utilisation being low is good so if you have 2 BT cards with say £10k credit and 2 normal with £2k credit then closing 2 cards will have a big impact on available credit and utilisation. Personally I am going to close one of my BT cards when offer ends if they don't give any deals - 1 does every month, the other is a fixed deal as I might want another card in the future
  • skyscraper101skyscraper101 Forumite
    27 Posts
    Tenth Anniversary 10 Posts Combo Breaker
    Forumite
    It's a myth that card companies don't make money from you even if you pay in full, they get fees every time you spend on the card. You'll find lots of people on here have multiple cards, I have 4 as it happens, 2 normal, 2 BT, 2 are paid in full every month, the BT ones are paid at a fixed DD to clear down by the end of the period. CRAs say that credit utilisation being low is good so if you have 2 BT cards with say £10k credit and 2 normal with £2k credit then closing 2 cards will have a big impact on available credit and utilisation. Personally I am going to close one of my BT cards when offer ends if they don't give any deals - 1 does every month, the other is a fixed deal as I might want another card in the future
    Oh I know they get fees. It was more about whether or not it was necessarily a good idea thing to have a stash of 'used' cards that are just kept alive with a small purchase once a month, and habitually paid down in full.

    If I were a BT card issuer I'd probably consider a quick analysis of all the card activity to be an unprofitable bet (and I'm wondering if that was the case with Santander - but they will never tell me why I was declined).
  • There's rarely any need to close old cards down, unless the limits dwarf your income or you have spending problems.
  • edited 4 March 2021 at 1:43PM
    skyscraper101skyscraper101 Forumite
    27 Posts
    Tenth Anniversary 10 Posts Combo Breaker
    Forumite
    edited 4 March 2021 at 1:43PM
    There's rarely any need to close old cards down, unless the limits dwarf your income or you have spending problems.
    Thanks. I'll just keep mine alive then I guess. That makes three active cards (Amex, Barclaycard Visa, and a Natwest Mastercard) plus an Amazon mastercard I have just for Amazon, a Revolut Card for foreign currency, A Virgin Money card (BT #1, cleared down), and the soon to be cleared down MBNA (BT #2 card).

    Collectively they must be worth tens of thousands but in reality only the Amex gets used for most things, with the others as backups for those that don't take Amex.
  • BossworldBossworld Forumite
    422 Posts
    Part of the Furniture 100 Posts Name Dropper Combo Breaker
    Forumite
    I closed three cards down over the last 12 months and I’m about to close off my last stoozing card.

    The only thing I’ve seen it affect is my credit utilisation % (based on my two remaining cards, but they’re used for day to day expenditure and paid off in full every month).


Sign In or Register to comment.
Latest MSE News and Guides

Did you know there's an MSE app?

It's free & available on iOS & Android

MSE App

Regifting: good idea or not?

Add your two cents to the discussion

MSE Forum

Energy Price Guarantee calculator

How much you'll likely pay from April

MSE Tools