Credit score

Pat38493

If I have multiple credit cards, is it the credit limit that I have, or the actual outstanding debt, that counts for credit checking?

For example if I have 5 credit cards each with £5K limit, but the current total balance across them is is £10K.

If I then applied for a 6th card, will they see my current debts as £10K or £25K (or both)?

My question really relates to whether I should cancel old credit cards that I don't use anymore, but are still technically active.

DullGreyGuy

Both... they will see what your limit is on each card and what your utilisation is on each card. 

Each lender has its own preferences and so there is no simple do X and you'll be more likely to be accepted (other than the most basic things like pay on time)

born_again

Forget the credit score.
Lenders will look at you used & aviaible credit against your income. Then decide if you meat their risk appetite.

th081

Pat38493 said:

If I have multiple credit cards, is it the credit limit that I have, or the actual outstanding debt, that counts for credit checking?

For example if I have 5 credit cards each with £5K limit, but the current total balance across them is is £10K.

If I then applied for a 6th card, will they see my current debts as £10K or £25K (or both)?

My question really relates to whether I should cancel old credit cards that I don't use anymore, but are still technically active.

They see a lot of info. The original credit limit, limit now. Balance each month, if payment was late, if you are on a promotion etc. From that wealth of info they make an assessment on if you will pay them back and the risk. If you have lots of unused credit relative to salary that is a risk as well.

Nebulous2

I've never been convinced that available credit is an issue. I've had over my salary in credit limits for more than 20 years. At times I've had more than twice my salary in credit limits. Now I'm mainly retired I've closed a couple of cards, but I still have over £50k in credit limits. 

Usage is a different matter. Having over 50% of your salary in consumer debt makes getting more increasingly difficult. 

daivid

Nebulous2 said:

I've never been convinced that available credit is an issue. I've had over my salary in credit limits for more than 20 years. At times I've had more than twice my salary in credit limits. Now I'm mainly retired I've closed a couple of cards, but I still have over £50k in credit limits. 

Usage is a different matter. Having over 50% of your salary in consumer debt makes getting more increasingly difficult. 

Typically I've had credit limit totals just over double my salary and utilisation around 1/3 of my salary. As I usually shut down cards in groups at times my limits have totalled 3x salary. It may be coincidental but the more available credit I've had the more generous new cards have been with their limits. Will be testing out the effect of usage over the next few months if stoozing's current attractiveness continues.

Pat38493

Is it still like the old days where if you approached your credit limit they automatically increase it if they are happy with the risk?  I just applied for a 0% Barclaycard and the credit limit they gave me initially was pretty low - less than 10% of my annual salary.

WillPS

Pat38493 said:

Is it still like the old days where if you approached your credit limit they automatically increase it if they are happy with the risk?  I just applied for a 0% Barclaycard and the credit limit they gave me initially was pretty low - less than 10% of my annual salary.

As with everything, each lender has their own criteria the only people who know definitively what the criteria are for any individual lender are not at liberty to say.

It's a fools errand trying to determine patterns like this when there are so many variables at play.