Too many lines of credit?

RBYHS

Hello everyone!

long story short, I am 19. Trying my best to build my credit and looking to buy in winter/ beginning of next year. 

I am now worried that I might have too many lines of credit? 

At the moment I have the following:

Capital One: £200
Capital One: £1200
Aqua 1: £600
Aqua 2: £600
Zopa: £300
Vanquis: £250 
Very: £950 (£35 balance)
Studio: £450 (0 balance)
Creation Currys my plan: £2500 (£500 balance)

I use my credit card for everything I buy and I always pay the bill in full! 

My annual salary is 35k and with overtime and bonuses I get about 38k

I am worried that I might have too much credit and will affect my eligibility for a mortgage. 

And I have a £12.5K car finance (8.7k left to pay). 

Should I close some credit cards? Maybe the ones with the lowest limits? 

Thank you 😊 

RBYHS

Just to add, everything is affordable for me. As I don’t Max any line of credit! Always below 30%. Thank you 😊 

Nebulous2

Your credit limits are very low, so although you have a lot of accounts your limits are nothing to be concerned about. 

Of more concern is the fact you are carrying debt, including low value, presumably high interest debt.  Try to repay all your credit accounts in full every month.

It will depend how close to your limit you are flying for the mortgage, but the car loan will knock a chunk off how much you can borrow.  

The mortgage forum is a better place for checking mortgage affordability, as there are a few brokers who post there, but carrying debt would be more concern to me than the number of accounts. 

RBYHS

Nebulous2 said:

Your credit limits are very low, so although you have a lot of accounts your limits are nothing to be concerned about. 

Of more concern is the fact you are carrying debt, including low value, presumably high interest debt.  Try to repay all your credit accounts in full every month.

It will depend how close to your limit you are flying for the mortgage, but the car loan will knock a chunk off how much you can borrow.  

The mortgage forum is a better place for checking mortgage affordability, as there are a few brokers who post there, but carrying debt would be more concern to me than the number of accounts. 

Thank you for your reply. The only debt I carry is Creation which is on a 12 months interest free which I will pay off in the next two months. I don’t carry any credit card balance and Very will be paid off when the statement generates. I know about the car finance but I can’t pay it off yet as I am building my savings for the deposit. However I am only looking at shared ownerships so the mortgage would be very low as I am thinking of starting with owning 25%. 

Thank you for the advice ☺️

cymruchris

I'd keep everything as it is for now as your limits are low - use each of the cards for a couple of items a month - don't let any stay dormant - pay off the balance in full by DD if you can - and over the coming year you should find your credit limits increase through your pattern of good management. The only one that might not rise is the Capital One at £1200 - they seem to not go up very often for those in a similar position. At about the 6 month from now mark - you could combine both Capital One credit limits into one card - and close one account. They do allow you to consolidate your credit limits into a single account (they did it for me). When it gets closer to you wanting a mortgage - you should try to avoid asking for any other NEW credit in the 6 months leading up to your application. 

kimwp

I'd personally look to close a few for several reasons - simplicity, opening up the possibility of new customer offers and it would be better for larger purchases to have higher limits on fewer cards so you don't need to split a purchase between cards. I'd personally look to close any that aren't giving you a benefit in some way, noting that it (seems to be) a good idea to keep your oldest one open for the length of history it provides.