Can credit card limits be consolidated?

xmarksthespot · 9 February 2019 at 1:07PM

I have amassed many credit cards over the years from different providers - usually because one card had an offer - such as Avios - which was then reduced or withdrawn and better card options existed. Then I have a card I use for non-GBP transactions and cash withdrawals overseas.

I never have any problem getting credit and I always pay off my credit cards in full each month, but find that I'm only using 2-3 different cards (out of the 8-10 or so that are active).

Today I received a card from one of the card companies I tend not to use any longer (it was simply because the previous card was nearing expiry). It has a massive credit limit and I'd prefer if I had less cards and could perhaps distribute this limit to one or more of the other cards that I do use that have lower limits for the "just in case I need it" scenario.

1. Is 'consolidation' of the limits possible?
2. How does having multiple cards affect my credit rating currently?
3. How would closing some of these cards affect my rating?

Grateful for any help or insight.

[Deleted User] · 9 February 2019 at 1:18PM

You can't move limits between lenders - only sometime within the same company.

You have no credit rating to be affected by either cards or limits.

Lenders will assess your total limits, debts and other factor in making a decision. That will vary across lenders. All you can do is consider whether you are carrying too high a limit in regard to your income.

xmarksthespot · 9 February 2019 at 1:26PM

Thank you. Just to check my understanding, by having 'unused' but active cards, am I therefore hampering the credit limit I can get when I open a new card? And by closing an account does that better enable me to negotiate up one of my existing credit limits on one of the cards I do use?

One of the reasons I ask is because I opened a new card recently that has fee free withdrawals overseas and with no interest on that cash withdrawal until statemented. The card came with a credit limit and within that a cash credit limit (which they hadn't made explicit during the application or in their literature or website) which for me is about one third of the total credit limit. This constraint actually makes the card a bit ineffective for several cash withdrawals on long trips.

[Deleted User] · 9 February 2019 at 1:28PM

It depends on what you have. Closing card and having reduced limit can suggest that no one trusts you.

Having excessive limit in regard to your income can look like you couldn't handle any more.

There is no one size fits all solution.

If you post income, cards, balances and limits, then a more specific answer could be given.

xmarksthespot · 9 February 2019 at 1:38PM

"Closing card and having reduced limit can suggest that no one trusts you"

"Can suggest." To whom? Can you explain your one-liner please?

Surely if I call the bank, cancel the card and they see it hasn't been used there's no issue. Or is there someone somewhere in the murky world of finance without access to the reason, second-guessing why an account has been closed and making decisions on that basis?! Would be curious to understand how it works.

The credit limits when added together amount to about 70% of my income. As previously advised, all balances paid off in full each month.

[Deleted User] · 9 February 2019 at 1:43PM

xmarksthespot wrote: »

"Closing card and having reduced limit can suggest that no one trusts you"

"Can suggest." To whom? Can you explain your one-liner please?

Lenders will see you have had a number of cards closed and limits cut.

They may be generous and decide that you chose to do that.

Or they may take the more likely route and decide that others lenders are concerned about your credit and reducing or closing limits.

With the limits you have in relation to income, you could stand to lose a card or two, if you have no immediate credit application needs coming up.

xmarksthespot · 9 February 2019 at 2:12PM

Perhaps you can explain what you mean exactly by "you could stand to lose a card or two..."?

And having given you the proportion of my total credit limit vs income, how does that compare with the market in general or how lenders view risk?

I'm inclined based on my reading/interpretation of what you say to 'do nothing' as if I close cards then future lenders are likely to make uninformed decisions. How ridiculous. This is almost as irresponsible as them giving credit to people who can't afford it!

At the minute the unused cards do no harm - and in fact they provide additional credit options if I ever need it. I see no advantages whatsoever of making any changes, but perhaps I've missed something fundamental?

Verityspinelli · 9 February 2019 at 3:13PM

xmarksthespot wrote: »

At the minute the unused cards do no harm - and in fact they provide additional credit options if I ever need it. I see no advantages whatsoever of making any changes, but perhaps I've missed something fundamental?

There you go, you answered your own question.

Credit card companies don’t negotiate whether they’ll give you more money, you ask, they say yes or they say no.
And please don’t ask me to explain to you how I came to that conclusion or what I mean, i don’t think it’s to hard to Understand.

[Deleted User] · 9 February 2019 at 7:37PM

Some lenders will let you consolidate across their products.

You can’t consolidate across different providers.

Ben8282 · 9 February 2019 at 9:28PM

When you mention a 'massive' credit limit could you give us some idea of how much this credit limit actually is.
The lower cash limit is nothing to do with your credit standing. It will be a normal feature of the card.
The total of my credit limits has exceeded my income for some time. I have had no problem in obtaining new cards, although I don't apply that often, and the lowest limit I have on any card, which was the last card I applied for, is in the region of £7000.
Credit limits totalling 70% of your income is not excessive.
It is perfectly normal for a person with a long established credit history who habitually repays in full each month to have thousands and thousands of pounds unused available credit. It is said that the optimum utilisation is 10%.
You will not be able to consolidate credit limits between different providers but if you have more than one card issued by the same provider, two Barclaycards for example, they may be able to consolidate the limits on one card.
In your place I would not leave the cards completely unused as no use for an extended period could result in cancellation of the card. It would be better to put a small purchase through each card from time to time just to keep them active.
You ask how having multiple cards affects your credit rating currently. Although credit scores are worthless in themselves, if you are getting good scores that would imply that the CRAs cant see anything particularly untoward with your current situation. Your post also implies that you have not experienced any particular difficulty in obtaining further cards, so I get the impression that everything is OK with your current credit rating. Leaving aside the cash withdrawal limit situation, have the credit limits that you have been getting in recent applications consistantly become exceptionally low? If yes, then perhaps you are seen to have excessive available credit. If no, then no problem.
With regard to the consequences of closing some accounts, avoid closing any cards with high credit limits or cards which have been open for a long time. High credit limits show that lenders trust you with such limits. Old credit card accounts show stability and also show that you have maintained the account for a long time without defaulting it. You do have quite a lot of credit cards so if there are any particular cards with low limits or cards that for one reason or another you don't particularly like etc it wouldn't do any particular harm to close them.

A4445 · 9 February 2019 at 9:59PM

I’ve closed a number of cards recently as my available credit was ridiculous. I consolidated a few so some looked like I had credit reductions and them closed. It’s not caused me any issues and I’ve just been accepted for a Mortgage. I’d like to close a few more but I’m going to stagger it just in case.

Can credit card limits be consolidated?

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