Pay off outstanding balances in full or not

mick15

I'm in  position to clear all my four Credit card balances in full, approx £4000

1 Should I go ahead and clear the outstanding balances in full and close the accounts

2 Almost clear the balances just leaving say a £10 - £15 balance on each card and retain the cards

3 Almost clear them off (as above) and ask for a reduced credit limit on each

Will any of the above have a negative impact on my credit score and which if any would improve my credit score currently 'Fair'

molerat

Are you paying interest on those balances ?  If yes clear them off completely. If no just pay minimums and keep the cash in a, preferably high interest, savings account.  Never carry an interest bearing balance on a card, not even £1.

Keep the cards and available credit if you can trust yourself not to run up further debt. Assuming these are "normal" credit cards with the usual interest free period then use for normal spending and pay off each statement in full each month which will improve your credit file.

Clearing the debt off will likely reduce the worthless seen only by you score but will improve your credit file, something lenders see.

born_again

mick15 said:

I'm in  position to clear all my four Credit card balances in full, approx £4000

1 Should I go ahead and clear the outstanding balances in full and close the accounts

2 Almost clear the balances just leaving say a £10 - £15 balance on each card and retain the cards

3 Almost clear them off (as above) and ask for a reduced credit limit on each

Will any of the above have a negative impact on my credit score and which if any would improve my credit score currently 'Fair'

Clear them off = no interest.
If you have 4 cards, do you need them all? Maybe keep the 2 with highest balances, or one Visa & 1 Mastercard in case of system outages. Close the rest.

Credit score means nothing to lenders, they never see it.

retiredbanker1

Clear them all but IMO keep them open and keep the limits as they are.

Your credit reports will show you are using a very small % of your credit limits - showing you as a responsible customer.

maxximus75

Clear them if paying interest.

Don’t lower the limits.

Keep them all open.

Set them all to pay-in-full.

Use a different card, each month.

Brie

Any 2 or more in the same banking group?  if so close one of them.  gives you more leeway if you want to BT anything in the future.

mick15

retiredbanker1 said:

Clear them all but IMO keep them open and keep the limits as they are.

Your credit reports will show you are using a very small % of your credit limits - showing you as a responsible customer.

Thanks, Great advice which I will implement