Having multiple Credit cards vs credit file 3 October 2022 at 7:07AM edited 3 October 2022 at 7:42AM in Credit file & ratings 8 replies 261 views

Casper7

Hi…
I have 4 credit cards, from 4 different providers. But I am mainly using two of them only.

I was reluctant to close the other two as they come with good borrowing amount. 

Although I wouldn’t use their allowance as the first two are suitable for my needs and affordability for now, I was wondering if keeping them is “healthy” for the credit score? Or just keep them if one day I needed them for urgent matter.

Can someone please advise if that is true? Or how to deal with a such situation?

Thank you

MovingForwards

Your credit score and rating are not seen or used by financial institutions, it's the credit history they see and use when assessing applications.

Providing your available credit is used responsibly, paid off in full each month and the cards are no maxed out with minimum payments being made, having 4 CC's makes no odds.

Ebe_Scrooge

As above, ignore your score.  But long-standing, well-managed lines of credit are seen as a positive on your credit history.  Assuming you can be disciplined enough to only spend what you can afford, then it's worth keeping the cards open.  Use them all occasionally and always repay in full - after a long period of inactivity, most lenders will close the account anyway.

phillw

Casper7 said:

I was reluctant to close the other two as they come with good borrowing amount. 

At what interest rate? Are you ever going to borrow money at that rate?

Brie

If you might use them at some point for a 0% balance transfer then that's a reason to keep them open.  If they are the type of card that never offers these (like my Barclaycard for the last few years) then maybe you want to close them in case you want a 0% card of some sort in the future.  Getting one may be easier if you have less credit available.  

[Deleted User]

Brie said:

If you might use them at some point for a 0% balance transfer then that's a reason to keep them open.  If they are the type of card that never offers these (like my Barclaycard for the last few years) then maybe you want to close them in case you want a 0% card of some sort in the future.  Getting one may be easier if you have less credit available.  

There is some argument about credit utilisation which closing cards will increase, it's maybe worth closing one if you think there is the chance of a new card holder offer though how long you have to wait for does depend on the lender, NatWest told me it was possible immediately when I closed that card as, like you, it stopped giving offers and was of no use to me when I had other cards that did. Weird that Barclaycard don't give you offers though, I have a balance on mine and currently have 2 years 0% for a 3.1% fee or 18 months MT offer at 2.9% fee

MalMonroe

Hi, can you just temporarily 'freeze' the two you don't use much? That's what I've done. I have three cards but only use one and don't want to cancel the others. Both CC companies suggested freezing my card for a while so I did that. To date it hasn't had any adverse effect on my credit reports.

[Deleted User]

MalMonroe said:

Hi, can you just temporarily 'freeze' the two you don't use much? That's what I've done. I have three cards but only use one and don't want to cancel the others. Both CC companies suggested freezing my card for a while so I did that. To date it hasn't had any adverse effect on my credit reports.

It won't make any difference to how it's reported as both cards are not used, all freezing does is prevent spending on it, it doesn't have anything at all to do with your credit history. Both lenders are likely to close the card if not used for 12 months anyway.

Alex9384

Casper7 said:

Can someone please advise if that is true? Or how to deal with a such situation?

Thank you

If those accounts have a good history (no late payments, etc.), keep them all open.

I would suggest to keep them active by making at least a small purchase every other month, or occasionally a larger purchase, otherwise your providers may decide to slash your credit limits if they come to the conclusion that you don't need them. If you don't use the credit, they may decide to offer it to someone else who will make use of it.