Inactive card has negative impact to credit score?

speedydogs

Hi all, 

I had an email this morning from ClearScore indicating that my credit score had changed. When I went on to have a look, it had dropped. In looking on further there was a change on only one account - a Virgin Money credit account had changed to inactive. 

I have 0 balance on any of my cards, but Virgin did email me yesterday to say they were increasing my credit limit. 

Is this normal? I’ve never heard of something like this before 

Fingerbobs

I wouldn't concern yourself about it. The credit scores produced by the credit reference agencies are only seen by you. They're not seen or used by prospective lenders, who will each have their own internal scoring system based on the information contained in your file. 
That said, it's probably best to use your cards a little and pay them off in full every month, to create a positive credit history. 
I've got a couple of cards flagged as Inactive/Dormant, but never have any trouble applying for credit. 

eskbanker

speedydogs said:

In looking on further there was a change on only one account - a Virgin Money credit account had changed to inactive. 

I have 0 balance on any of my cards, but Virgin did email me yesterday to say they were increasing my credit limit. 

I'd have thought that availability of more credit is rather more likely to impact on credit rating than an account being marked as inactive?

If you have multiple cards without any balances, that suggests you have plenty more credit than you actually need, so it's unclear why you'd be concerned about your 'score', or are you perhaps going to be needing access to a mortgage or something significant in the near future?

Brie

Easy thing to do is to use each card in turn and pay them all off and see if that changes anything.  Not that it matters (as others have said).   But if you do have a number of cards you do not intend to ever use then I would cull a couple.  That way if you see a great deal like 24 months 0% interest on purchases just when you want to buy something special you are more likely to get that new card.

speedydogs

eskbanker said:

speedydogs said:

In looking on further there was a change on only one account - a Virgin Money credit account had changed to inactive. 

I have 0 balance on any of my cards, but Virgin did email me yesterday to say they were increasing my credit limit. 

I'd have thought that availability of more credit is rather more likely to impact on credit rating than an account being marked as inactive?

If you have multiple cards without any balances, that suggests you have plenty more credit than you actually need, so it's unclear why you'd be concerned about your 'score', or are you perhaps going to be needing access to a mortgage or something significant in the near future?

The credit limit won’t be increased until June, it’s just strange that email came through yesterday and then that card was flagged on my account. 

I don’t have a mortgage and I am on the lookout for a home so that’s why I’m concerned. 

eskbanker

speedydogs said:

I don’t have a mortgage and I am on the lookout for a home so that’s why I’m concerned. 

As mentioned above, changes to a fictional 'score', that isn't seen by lenders, don't matter, but no harm in discussing your credit situation with a mortgage broker for a more accurate picture about how you're likely to be seen by real lenders....

Chrysalis

I get these emails every month, ignore them, they move down one month, move up again, repeat the cycle.

The most useful thing about these agencies is checking your history to make sure its accurate.  Also provides a good summary of credit utilisation.

MalMonroe

Hi, if you don't want to use a card but don't want to close it either, you can always freeze it. I've done that with my Virgin cc and they never bother me.  I will be using it again but have chosen not to for a while, as I've been using a 0% purchase card via my current account bank recently. I'm attempting 'stoozing' - and am putting the money I'd use to clear the monthly balances on that card in a high interest savings account for 12 months. I think I'm doing it right . . . !  So far so good. Looking forward to being very wealthy in February. 

Ryan_Holden

I am convinced that the credit score checkers like Experian sometimes randomly adjust your score to make you curious so you buy a subscription for a month.

For example, I've had 999 on Experian for years, then about 3 months ago, out of no where, it dropped to 987. No activity, no explanation. If I want to know why, I can buy a month's membership for £14.99....

born_again

Ryan_Holden said:

I am convinced that the credit score checkers like Experian sometimes randomly adjust your score to make you curious so you buy a subscription for a month.

For example, I've had 999 on Experian for years, then about 3 months ago, out of no where, it dropped to 987. No activity, no explanation. If I want to know why, I can buy a month's membership for £14.99....

That is how they make their money, as well as recommending certain cards or loans. For which they get a tidy bribe referral fee.

visibility

I honestly, will not be concerned about your credit score dropping by a few points (especially if you are not looking to buy a house or take out a loan in the next couple of months). Just make sure you keep up your monthly payments and make sure your incoming cover your outgoings. 

Also, if you want to monitor your score you won't need to pay for a subscription. You can get clearscore for free and you will be able to get notifications on when score changes. If you really need to improve your credit rating, no point in paying these new apps just simply get a credit card and make sure you pay it in full.