Your browser isn't supported
It looks like you're using an old web browser. To get the most out of the site and to ensure guides display correctly, we suggest upgrading your browser now. Download the latest:

Welcome to the MSE Forums

We're home to a fantastic community of MoneySavers but anyone can post. Please exercise caution & report spam, illegal, offensive or libellous posts/messages: click "report" or email forumteam@. Skimlinks & other affiliated links are turned on

Search
  • FIRST POST
    • flammable999
    • By flammable999 12th Aug 18, 11:46 AM
    • 102Posts
    • 21Thanks
    flammable999
    To close or not to close?
    • #1
    • 12th Aug 18, 11:46 AM
    To close or not to close? 12th Aug 18 at 11:46 AM
    I have often read on here, that it is hard to strike the balance as to what to do with unused cards. On the one hand, I have a lot of unused cards, but on the other hand I do currently have a utilisaion of 47% and obviously closing some cards, will increase this utilisation. Furthermore, a lot of my unused cards are quite old, showing some stability. Am playing the balance transfer game, hence the top heaviness amongst cards

    What cards, if any do people think I should close looking at below current state of affairs?

    Card / Balance / Limit / Age

    Aqua / 0 / 4950 / 8 yrs
    Vanquis / 0 / 3000 / 12 yrs
    Tesco 1 / 2857 / 3250 / 1 yr
    Tesco 2 / 2800 / 2800 / 2 months
    MBNA / 5182 / 5400 / 1 yr
    MBNA 2 / 2585 / 3000 / 1 yr
    Capital One / 0 / 2500 / 7 yrs
    Santander / 0 / 3700 / 3 yrs
    M & S / 143 / 5500 / 4 yrs
    Barclaycard / 2687 / 2900 /4 yrs

    Any advice welcome.
Page 1
    • eskbanker
    • By eskbanker 12th Aug 18, 11:58 AM
    • 7,842 Posts
    • 8,657 Thanks
    eskbanker
    • #2
    • 12th Aug 18, 11:58 AM
    • #2
    • 12th Aug 18, 11:58 AM
    Does your concern about utilisation ratio and age of cards signify that you're planning on continuing to seek further credit, even if just for BTs?

    As you say, there's a balance to be struck, in that you currently have access to 30K+ of credit, and, unless you're particularly well paid, that could cause issues when prospective lenders consider affordability.

    What are the APRs of each card and if any are 0%, when do they expire?

    And what are your plans to repay these debts, i.e. are you expecting a decent lump sum in the near future or are you hoping to continue to shuffle the debt around?
    • flammable999
    • By flammable999 12th Aug 18, 12:05 PM
    • 102 Posts
    • 21 Thanks
    flammable999
    • #3
    • 12th Aug 18, 12:05 PM
    • #3
    • 12th Aug 18, 12:05 PM
    Does your concern about utilisation ratio and age of cards signify that you're planning on continuing to seek further credit, even if just for BTs?

    As you say, there's a balance to be struck, in that you currently have access to 30K+ of credit, and, unless you're particularly well paid, that could cause issues when prospective lenders consider affordability.

    What are the APRs of each card and if any are 0%, when do they expire?

    And what are your plans to repay these debts, i.e. are you expecting a decent lump sum in the near future or are you hoping to continue to shuffle the debt around?
    Originally posted by eskbanker
    Well for some of the sub-prime cards, the APR's are very high. For all the others, range between 16-19%. All the ones with a balance apart from M&S are currently on BT and I plan to keep shuffling them., chipping away where I can. The expirys range from Feb 19 to June 21

    My main worry is I am looking to re-mortgage in about a year so was wondering how the above and credit utilisation will affect my chances of that.
    • onlyfoolsandparking
    • By onlyfoolsandparking 12th Aug 18, 12:40 PM
    • 47 Posts
    • 12 Thanks
    onlyfoolsandparking
    • #4
    • 12th Aug 18, 12:40 PM
    • #4
    • 12th Aug 18, 12:40 PM
    I have 9 cards which i play the B/T shuffle and all 9 are interest free, its tricky to keep them all 0% but not impossible. Looking at your cards and if it was me i would definitely get rid off Aqua, Vanquis and maybe Capital one too i think the first two hurt your credit worthiness, they are credit builder cards with extortionate rates. then i would look at opening a couple of new ones more mainstream card/s that offer great 30-40 months B/T deals. Virgin and Halifax would be an obvious choice if it were me in your position. Actually just re-reading your post maybe keep the Capital one as you've had it a long time, lenders like us having cards a long time, maybe get rid of the M&S one instead.


    Of course it closing accounts down with high credit limits and applying for new ones is always a bit of a gamble i,ve done it closed a card down with 17k limit then got offered new one with 7k limit???? so up to you in the end.
    Last edited by onlyfoolsandparking; 12-08-2018 at 12:45 PM. Reason: additional info
    • eskbanker
    • By eskbanker 12th Aug 18, 12:41 PM
    • 7,842 Posts
    • 8,657 Thanks
    eskbanker
    • #5
    • 12th Aug 18, 12:41 PM
    • #5
    • 12th Aug 18, 12:41 PM
    As you recognise, there's no right or wrong answer to this, but personally I'd have thought that prospective lenders would be able to see that, while the sub-prime cards may have been open for a relatively long time, they're clearly no longer in active use and therefore aren't really signifying the positive picture of credit management that's usually cited as the reason to retain cards.

    Closing them and reducing available credit obviously increases utilisation ratio but improves affordability as measured by total credit v income.

    In the context of remortgaging there are obviously a range of other parameters that are relevant, in terms of income, property value/equity, etc, so perhaps worth discussing your situation with a mortgage broker?
    • flammable999
    • By flammable999 12th Aug 18, 12:43 PM
    • 102 Posts
    • 21 Thanks
    flammable999
    • #6
    • 12th Aug 18, 12:43 PM
    • #6
    • 12th Aug 18, 12:43 PM
    I have 9 cards which i play the B/T shuffle and all 9 are interest free, its tricky to keep them all 0% but not impossible. Looking at your cards and if it was me i would definitely get rid off Aqua, Vanquis and maybe Capital one too i think the first two hurt your credit worthiness, they are credit builder cards with extortionate rates. then i would look at opening a couple of new ones more mainstream card/s that offer great 30-40 months B/T deals. Virgin and Halifax would be an obvious choice if it were me in your position.
    Originally posted by onlyfoolsandparking
    What you say makes sense, but Aqua and Vanquis are also cards that show a greater age, which I am led to believe increases stability as well as their generous limits. I have no intention of ever using them again due to their rates but keep them for the above reasons. Plus I am not sure if lenders can see the company names when they do their own checks

    I will look into Virgin and Halifax though when some of my current ones expire.
    • flammable999
    • By flammable999 12th Aug 18, 12:44 PM
    • 102 Posts
    • 21 Thanks
    flammable999
    • #7
    • 12th Aug 18, 12:44 PM
    • #7
    • 12th Aug 18, 12:44 PM
    As you recognise, there's no right or wrong answer to this, but personally I'd have thought that prospective lenders would be able to see that, while the sub-prime cards may have been open for a relatively long time, they're clearly no longer in active use and therefore aren't really signifying the positive picture of credit management that's usually cited as the reason to retain cards.

    Closing them and reducing available credit obviously increases utilisation ratio but improves affordability as measured by total credit v income.

    In the context of remortgaging there are obviously a range of other parameters that are relevant, in terms of income, property value/equity, etc, so perhaps worth discussing your situation with a mortgage broker?
    Originally posted by eskbanker
    Very true. It also makes sense why the credit club always says my affordability is weak.
    • onlyfoolsandparking
    • By onlyfoolsandparking 12th Aug 18, 12:52 PM
    • 47 Posts
    • 12 Thanks
    onlyfoolsandparking
    • #8
    • 12th Aug 18, 12:52 PM
    • #8
    • 12th Aug 18, 12:52 PM
    From what i can gather and other people may know better than me on this one, prospective lenders cant see in detail who else lends to you but they can see payment history and maybe credit limits/utilisation although i don't believe they can see credit limits as they they would never offer me anything ever again if they knew my card limits add up to 120k!!! so i work this way i NEVER miss any payments, don't go over limits, try and keep utilisation 30% or below and only apply for a new card when needed once in a 12 month period
    • Willing2Learn
    • By Willing2Learn 12th Aug 18, 1:14 PM
    • 789 Posts
    • 609 Thanks
    Willing2Learn
    • #9
    • 12th Aug 18, 1:14 PM
    • #9
    • 12th Aug 18, 1:14 PM
    ...although i don't believe they can see credit limits
    Originally posted by onlyfoolsandparking
    Potential lenders can see credit limits as that is a data field, recorded on your credit file.
    I work within the voluntary sector, supporting vulnerable people to rebuild their lives.

    I love my job

    • onlyfoolsandparking
    • By onlyfoolsandparking 12th Aug 18, 1:33 PM
    • 47 Posts
    • 12 Thanks
    onlyfoolsandparking
    thanks, I said I wasn't sure about that one but makes sense for them to see it I guess
    • Gary_Dexter
    • By Gary_Dexter 12th Aug 18, 3:28 PM
    • 1,736 Posts
    • 1,004 Thanks
    Gary_Dexter
    Lenders can see your limits and the account age but not whom the account is with.

    Ask MBNA if they can consolidate the 2 cards into one for a start.

    Then do the same for Tesco.
    • nic_c
    • By nic_c 12th Aug 18, 3:50 PM
    • 1,615 Posts
    • 878 Thanks
    nic_c
    Lenders can see your limits and the account age but not whom the account is with.

    Ask MBNA if they can consolidate the 2 cards into one for a start.

    Then do the same for Tesco.
    Originally posted by Gary_Dexter
    Quite correct, so don't close your older cards, it makes no difference that they were builder cards, they don't see provider or APR ( I suppose they could work out the APR if you had a running balance).

    If any cards have new customer BT offerings that appeal, you could consider closing so that they would be available for future BT offers as a new customer.

    I'm not sure the utilisation will be as much of a concern for your remortgage as the level of debt that needs to be serviced, that will affect affordability.
    • flammable999
    • By flammable999 12th Aug 18, 4:07 PM
    • 102 Posts
    • 21 Thanks
    flammable999
    Lenders can see your limits and the account age but not whom the account is with.

    Ask MBNA if they can consolidate the 2 cards into one for a start.

    Then do the same for Tesco.
    Originally posted by Gary_Dexter
    Will consolidating work if they have BT offers that expire at two different dates?
    • flammable999
    • By flammable999 12th Aug 18, 4:10 PM
    • 102 Posts
    • 21 Thanks
    flammable999
    Quite correct, so don't close your older cards, it makes no difference that they were builder cards, they don't see provider or APR ( I suppose they could work out the APR if you had a running balance).

    If any cards have new customer BT offerings that appeal, you could consider closing so that they would be available for future BT offers as a new customer.

    I'm not sure the utilisation will be as much of a concern for your remortgage as the level of debt that needs to be serviced, that will affect affordability.
    Originally posted by nic_c
    Very true on all points
    • Gary_Dexter
    • By Gary_Dexter 12th Aug 18, 5:54 PM
    • 1,736 Posts
    • 1,004 Thanks
    Gary_Dexter
    They usually won!!!8217;t honour them and you!!!8217;ll lose them.

    You!!!8217;ll need to ask and check regarding any existing promos before consolidating
    • sparkey1
    • By sparkey1 13th Aug 18, 9:01 PM
    • 424 Posts
    • 181 Thanks
    sparkey1
    As they can see your limits, and your balances they can calculate your utilisation. They can also see if the balance is on a promo rate, and if you only pay the minimum each month.

    Only ever close an old card if the fee structure changes. Ie its was free and they now want you to

    Never lower a limit, it stuffs your utilisation. It does nothing for your affordability. A debt of 1000 is stilll a debt, but its a lot more damaging if your limit is 1100 pounds and not 11000 pounds.

    Garys advice on consolidating your cards with MBNA and Tesco is worth looking at, in order to help make it easier to keep a track of things. Just make sure the consolidated card, has the same limits as the total limits on the separate cards. In an ideal world you want to keep the oldest MBNA / Tesco cards. Ask to do a deal on rates etc. Look at all options. MBNA are good with new offers for existing customers. However I have noticed that the offers dont come if your high across overall utilisation with all providers. At 47% overall you should still be getting offers.

    Are alll your cards 0%? If not, clear the balances. No point in paying interest without a plan!
    • GM1880
    • By GM1880 15th Aug 18, 10:09 PM
    • 154 Posts
    • 57 Thanks
    GM1880
    I!!!8217;d be interested to hear views on my situation.

    A year ago I had two defaults and a CCJ on file. So got a Vanquis and latterly a Barclaycard which were my first credit cards in years. One default has dropped off and I got the CCJ set aside and got an Amex and an HSBC card.

    The main thing I want is two cards with a high enough limit to rent cars in Europe given the huge deposit. I want to collect Avios with Amex and of course want to build a good credit history to apply for a mortgage next year.

    So, I have.

    Vanquis - 2500 limit - 12 months old. Never really use it.
    Barclaycard - 1200 limit - 8 months old. Use about 500/month and pay off in full
    Amex - 7400 limit - 4 months old. Use about 4000 per month and pay off in full
    HSBC - 3000 limit - 3 months old - barely use it because their systems are rubbish.

    The Barclaycard and Amex are most user friendly. But Barclaycard won!!!8217;t increase my limit which i!!!8217;d prefer, then I can get rid of HSBC or Vanquis or both. Would closing Vanquis be a poor move given their my oldest card? Would closing HSBC be bad given it!!!8217;s relatively new? Should I just keep Vanquis/HSBC even if i!!!8217;m Using sporadically?

    Is part of the reason Barclaycard aren!!!8217;t increasing my limit because I have a relatively high unused limits with other cards?
Welcome to our new Forum!

Our aim is to save you money quickly and easily. We hope you like it!

Forum Team Contact us

Live Stats

2,674Posts Today

8,465Users online

Martin's Twitter
  • Ta ta... for now. This August, as I try and do every few yrs, I'm lucky enough to be taking a sabbatical. No work,? https://t.co/Xx4R3eLhFG

  • RT @lethalbrignull: @MartinSLewis I've been sitting here for a good while trying to decide my answer to this, feeling grateful for living i?

  • Early days but currently it's exactly 50 50 in liberality v democracy, with younger people more liberal, older more? https://t.co/YwJr4izuIj

  • Follow Martin