Do Lloyds tend to cut limits / close accounts??

NewLeaf1986

I notice many threads regarding certain card providers cutting limits or closing accounts of people who infrequently use their accounts, especially Barclaycard.

OH had just been approved for a Lloyds Platinum card with £5,300 limiy and 9.9% APR. It isn't the highest limit he has but it is by far the lowest APR and could prove an asset in future once we've bought a house in case there's some refurbishments / improvements we'd like to finance.

We / He probably won't have a use for the card for a couple of years and it's likely to stay locked away in the envelope until we are homeowners...

What are other people's experience with Lloyds if they don't use their account for a while? I'd rather avoid a situation where they do a Barclaycard on him as it was an excellent deal he's been able to obtain and there's no guarantee such a deal will be available to him again if Lloyds decide to close this account.

On the flip side, I don't want to have to use the account just for the sake of using it, but will if others have experienced Lloyds withdrawing dormant credit facilities on the regular, although right now if we did use it it would likely be for less than 10% of its limit and cleared in full each month. 

[Deleted User]

While Lloyds don't particularly cut limits of active cardholders, if it's not going to be used for a couple of years, it's far more likely to be closed.

Either use the card now (especially if he's not using any card) or wait until you need a decent card and apply then. If he can build some solid history, he'll fell be able to get something better.

Nebulous2

I'm not sure what you regard as using it 'just for the sake of it' but starting to use a credit card gives you a one-off opportunity to defer expenditure for a month.

Use it for some normal expenditure, fuel perhaps, pay it off in full by direct debit and stick the money you save that first month in your house deposit. 

That will help improve his credit history. While 9.9% is extremely good for a credit card, I prefer to pay nothing on any money I borrow. Building up his record of paying will increase his chances of getting a 0% deal when you do need it. 

NewLeaf1986

Good tips, thanks both. 

PRAISETHESUN

In case it helps, I've had for a number of years at this point a Lloyds card with a substantial limit which I don't use much these days. I just make an effort to make a small purchase with it every few months or so to keep it alive and I haven't had any attempts to reduce the limit.

[Deleted User]

Even in a couple of years allowing for some interest rate rises, buying stuff for a house with the intention of leaving it on the CC at 9.9% is financially irresponsible and will cost you a lot, you'd do better looking at a loan at the time or a 0% BT card / money transfer card. Use the card monthly and pay off in full to keep the card active and build up the credit history and it will look good for future borrowing purposes and you may well get better rates in the future

NewLeaf1986

Deleted_User said:

Even in a couple of years allowing for some interest rate rises, buying stuff for a house with the intention of leaving it on the CC at 9.9% is financially irresponsible and will cost you a lot, you'd do better looking at a loan at the time or a 0% BT card / money transfer card. Use the card monthly and pay off in full to keep the card active and build up the credit history and it will look good for future borrowing purposes and you may well get better rates in the future

Well that depends on what you place value in.

Sometimes having a card that charges next to no interest on a permanent basis makes for a much simpler life than chasing 0% deals which may or may not continue to be available when a given offer comes to an end. 

OH really doesn't need to build up any credit history, he has plenty, and already has excellent cards in his arsenal. 

It's just reassuring to know from the anecdotal evidence of others that if he doesn't use the card for a while Lloyds are less likely to take it away that for example, Barclaycard. 

[Deleted User]

NewLeaf1986 said:

Deleted_User said:

Even in a couple of years allowing for some interest rate rises, buying stuff for a house with the intention of leaving it on the CC at 9.9% is financially irresponsible and will cost you a lot, you'd do better looking at a loan at the time or a 0% BT card / money transfer card. Use the card monthly and pay off in full to keep the card active and build up the credit history and it will look good for future borrowing purposes and you may well get better rates in the future

Well that depends on what you place value in.

Sometimes having a card that charges next to no interest on a permanent basis makes for a much simpler life than chasing 0% deals which may or may not continue to be available when a given offer comes to an end. 

OH really doesn't need to build up any credit history, he has plenty, and already has excellent cards in his arsenal. 

It's just reassuring to know from the anecdotal evidence of others that if he doesn't use the card for a while Lloyds are less likely to take it away that for example, Barclaycard. 

I place value in not wasting money paying interest unnecessarily, 9.9% isn't next to nothing. Who said anything about chasing 0% deals? I am talking about buying what can be paid off in full every month or saving for it, not living on the never never, spending money I could be saving or investing, on interest. You said in the first post you wouldn't need to use it for a couple of years, so why not budget the money you'd need to pay off the card and put that in savings (say £1000 each in the Virgin current account paying 2% APR for example) so you have the money ready so you don't need to borrow? This is the Money Saving Expert site, not the Money Wasting Expert

Purely as an example, say you put £5000 on the 9.9% card, paying £250 a month as a fixed sum, it will take 22 months to clear, paying £463 interest

Not sure what sort of history he has but it's probably not great given you consider an "excellent" card to be one that is paying more than 9.9% interest on balances. Using the card every month and paying off in full would likely lead to better offers and as I said, a loan would probably be cheaper anyway than leaving it on the CC

NewLeaf1986

Deleted_User said:

NewLeaf1986 said:

Deleted_User said:

Even in a couple of years allowing for some interest rate rises, buying stuff for a house with the intention of leaving it on the CC at 9.9% is financially irresponsible and will cost you a lot, you'd do better looking at a loan at the time or a 0% BT card / money transfer card. Use the card monthly and pay off in full to keep the card active and build up the credit history and it will look good for future borrowing purposes and you may well get better rates in the future

Well that depends on what you place value in.

Sometimes having a card that charges next to no interest on a permanent basis makes for a much simpler life than chasing 0% deals which may or may not continue to be available when a given offer comes to an end. 

OH really doesn't need to build up any credit history, he has plenty, and already has excellent cards in his arsenal. 

It's just reassuring to know from the anecdotal evidence of others that if he doesn't use the card for a while Lloyds are less likely to take it away that for example, Barclaycard. 

I place value in not wasting money paying interest unnecessarily, 9.9% isn't next to nothing. Who said anything about chasing 0% deals? I am talking about buying what can be paid off in full every month or saving for it, not living on the never never, spending money I could be saving or investing, on interest. You said in the first post you wouldn't need to use it for a couple of years, so why not budget the money you'd need to pay off the card and put that in savings (say £1000 each in the Virgin current account paying 2% APR for example) so you have the money ready so you don't need to borrow? This is the Money Saving Expert site, not the Money Wasting Expert

Purely as an example, say you put £5000 on the 9.9% card, paying £250 a month as a fixed sum, it will take 22 months to clear, paying £463 interest

Not sure what sort of history he has but it's probably not great given you consider an "excellent" card to be one that is paying more than 9.9% interest on balances. Using the card every month and paying off in full would likely lead to better offers and as I said, a loan would probably be cheaper anyway than leaving it on the CC

I'm glad you are just as innately familiar with the world of lending products as I am with a similar aptitude for simple arithmetic as myself.

Of course what you do with this knowledge is entirely your prerogative as is it mine, and most importantly my other half's.

It's his life, his choice; and some people, my OH included prefer a simple life in terms of finances even if at the end of the day it makes the bottom line 0.2% lower than it could have otherwise been had they invested more time and diligence in tweaking the minor details within their financial affairs.

Not everyone weights up the cost:benefit the same way as you; it's a cornerstone of effective relationships to appreciate that. 

I'm here to guide my loved ones in the right direction but I'm also here to respect who they are as individuals. 

Thing is, I can read your post and it makes flawless sense to me. I show your post to my OH his eyes glaze over and nothing goes in; which is fine. He's bloody amazing at plenty of things I can't figure out to save my life too. That's how these things work. 

You find the right product for the use case, and the use case in this scenario is someone who wants something they can use on a rare occasion to spread the cost of an infrequent large purchase over a handful of months without it costing them much and without having to worry about 0% offers expiring or faffing with credit card applications every 12-24 months. Not everyone wants that in their life. 

The Lloyds 9.9% APR card and TSB 7.9% APR cards are the best options for this use case currently on the UK market. 

[Deleted User]

I wish you good luck then, people who throw away money inevitably end up with problems in life

callum9999

NewLeaf1986 said:

Deleted_User said:

NewLeaf1986 said:

Deleted_User said:

Even in a couple of years allowing for some interest rate rises, buying stuff for a house with the intention of leaving it on the CC at 9.9% is financially irresponsible and will cost you a lot, you'd do better looking at a loan at the time or a 0% BT card / money transfer card. Use the card monthly and pay off in full to keep the card active and build up the credit history and it will look good for future borrowing purposes and you may well get better rates in the future

Well that depends on what you place value in.

Sometimes having a card that charges next to no interest on a permanent basis makes for a much simpler life than chasing 0% deals which may or may not continue to be available when a given offer comes to an end. 

OH really doesn't need to build up any credit history, he has plenty, and already has excellent cards in his arsenal. 

It's just reassuring to know from the anecdotal evidence of others that if he doesn't use the card for a while Lloyds are less likely to take it away that for example, Barclaycard. 

I place value in not wasting money paying interest unnecessarily, 9.9% isn't next to nothing. Who said anything about chasing 0% deals? I am talking about buying what can be paid off in full every month or saving for it, not living on the never never, spending money I could be saving or investing, on interest. You said in the first post you wouldn't need to use it for a couple of years, so why not budget the money you'd need to pay off the card and put that in savings (say £1000 each in the Virgin current account paying 2% APR for example) so you have the money ready so you don't need to borrow? This is the Money Saving Expert site, not the Money Wasting Expert

Purely as an example, say you put £5000 on the 9.9% card, paying £250 a month as a fixed sum, it will take 22 months to clear, paying £463 interest

Not sure what sort of history he has but it's probably not great given you consider an "excellent" card to be one that is paying more than 9.9% interest on balances. Using the card every month and paying off in full would likely lead to better offers and as I said, a loan would probably be cheaper anyway than leaving it on the CC

I'm glad you are just as innately familiar with the world of lending products as I am with a similar aptitude for simple arithmetic as myself.

Of course what you do with this knowledge is entirely your prerogative as is it mine, and most importantly my other half's.

It's his life, his choice; and some people, my OH included prefer a simple life in terms of finances even if at the end of the day it makes the bottom line 0.2% lower than it could have otherwise been had they invested more time and diligence in tweaking the minor details within their financial affairs.

Not everyone weights up the cost:benefit the same way as you; it's a cornerstone of effective relationships to appreciate that. 

I'm here to guide my loved ones in the right direction but I'm also here to respect who they are as individuals. 

Thing is, I can read your post and it makes flawless sense to me. I show your post to my OH his eyes glaze over and nothing goes in; which is fine. He's bloody amazing at plenty of things I can't figure out to save my life too. That's how these things work. 

You find the right product for the use case, and the use case in this scenario is someone who wants something they can use on a rare occasion to spread the cost of an infrequent large purchase over a handful of months without it costing them much and without having to worry about 0% offers expiring or faffing with credit card applications every 12-24 months. Not everyone wants that in their life. 

The Lloyds 9.9% APR card and TSB 7.9% APR cards are the best options for this use case currently on the UK market. 

I'm struggling to see how devising a plan to regularly use this card (which you don't currently want to be using) over the span of two years just in case you want to use it in the future is less "faff" than simply applying for a card when you need it? (On that subject, I had my credit limit slashed when I just left a Lloyds card idle for years - no one can accurately tell you whether thats likely to happen to you or not though)

Though I guess the issue could be he likes to spend large amounts (which he doesn't have) on a whim without waiting for a new credit card to arrive. In which case, good luck!