Do I have too much available credit?

Yuzo

I currently have 4 credit cards, I always keep them open for when promotions come to an end and need to do a balance transfer. However my cards have been set to auto increase credit limit and now seem very high available credit.... the available on all cards is £27,700,... my balance on cards is only £5000.

I have a Barclaycard on £0 with a £12,000 limit, should I close this down to bring my available credit down? and maybe this will improve my credit score and chances of getting accepted for credit in the future? It’s seems very hard to get accepted for good rates on cards recently.

Thanks.

[Deleted User]

Your limits are low and you only have 4 cards. Keep them all.

Disregard your credit score. You can seek to manipulate it, but it will serve no purpose as it's only provided for entertainment.

Nebulous2

It depends to some to some extent on your income, but I have had high limits, in excess of my income, sometimes over twice my income, for many years. I don’t see any problems with it. Using a lot of it would be a different story! 

pjread

Every lender will have their own criteria. None will care or even see the 'credit score' number you are sold by the CRA's platforms.  At the very, very most they're a rough guide to how some lenders might perceive you.  But Lender A and Lender B only see the actual accounts, balances, payment info etc - and might very well make different decisions from the same information based on their own risk policy etc.

example;

Yuzo has £5k used over 4 cards with £27k limit and applies for a new card

• Lender A - Great, they've £27k available and using <20%, must be able to manage credit well, here's another card!
• Lender B - Hmm, they could go grab £20k tomorrow and they're asking me for more??  No thanks, sounds risky

Yuzo closes a £12k limit card - some fictional number moves (up or down...) on a credit agency's portal so Yuzo feels happy about that so waits a few months then decides to apply for another card

• Lender A - Hmm, they're £5k in the hole on £15k available credit, and that's over 30% up from under 20% 3-6 months ago...  and we don't know why that other account closed, maybe that bank knows something we don't - might be a risk they're overextending...  Sorry, that's a no
• Lender B - Right lets look - oh right, so the worst they could do is rack up another £10k?  That doesn't sound so bad, sure lets approve that.

(except less dialogue and emotion since it'll just get piped through an automated process 99 times out of 100)

Alex9384

Deleted_User said:

Your limits are low and you only have 4 cards. Keep them all.

Disregard your credit score. You can seek to manipulate it, but it will serve no purpose as it's only provided for entertainment.

I'm not sure what do you mean by "your limits are low"?

By what measures is 12k a low limit? Or perhaps you meant his other cards? If they all had the same limit, they would still be over 5k each. I wouldn't call that a low limit either. What's the typical limit for an average UK person then?

Alex9384

Nebulous2 said:

It depends to some to some extent on your income, but I have had high limits, in excess of my income, sometimes over twice my income, for many years. I don’t see any problems with it. Using a lot of it would be a different story! 

I've been wondering about this for some time now... What is too much and what is still OK.

I too have combined limit exceeding my gross annual income by cca 40%.

6 credit cards and 1 charge card. I'm going to close the CC with lowest limit and after that my combined limit will be exactly 33% over my GAI. Not sure if that's considered good or bad or none of the two.

Dandytf

I'm dong rather well. At closing Higher Limits.
Short term pain, long term sensible gain.
In my instance it means avoiding running into Temptation in future years.
Gone recently are 2850/2650/4250 and one or two smaller ones.
Replacing with 3650/3750/1700 and existing 600 Limits.
Only 618 pounds to contend with from 1st of those cards, Interest Free 15 Mths.

[Deleted User]

Alex9384 said:

Deleted_User said:

Your limits are low and you only have 4 cards. Keep them all.

Disregard your credit score. You can seek to manipulate it, but it will serve no purpose as it's only provided for entertainment.

I'm not sure what do you mean by "your limits are low"?

By what measures is 12k a low limit? Or perhaps you meant his other cards? If they all had the same limit, they would still be over 5k each. I wouldn't call that a low limit either. What's the typical limit for an average UK person then?

I think he has a copy/paste answer for these common questions and forgot to tweak it. 12k on one card and 27k overall is not low unless you earned a lot. For me it would be over 100% of my pre-tax salary though that said I do have about 80% at the moment!