Credit card / Credit rating

[GrizzlyBear]

Just a quick query,

I have had cashback credit cards for well over a decade, I currently have two of them and bot have reduced the cashback percentage in the last few months, so I am looking around for a new card. I found one that looks like an improvement, but do I need to stop one of the cards before I apply?

One of my current cards may not pay out the cash back until next year (and probably won't pay out if I leave), so I was thinking of reducing the credit limit on the card by a couple of grand to get the next card up and running?

Anyone know how to change things to minimise the effect on my credit rating?

[colin79666]

As long as you otherwise have a good history (no long list of other loans, no missed payments etc.) then you will probably get on fine applying for another. I had 3 cards for a bit when I went the Amex route to get the cashback deals. I'm assuming you always pay off in full as otherwise the cashback is wiped out by interest payments and there are better cards for that.

[GrizzlyBear]

Thanks for the reply, well I have never actually looked at my credit history, but I have never been turned down for anything, and I have never missed a payment usual story; everything paid off in full each month (Cashback cards are a bit pointless if you are paying interest yourself). So I am assuming it can't been too bad.

The last card I took out probably about a year ago, they didn't actually ask what limit I wanted, I assumed they would ask before sending the card, but no... it arrived with a massive credit limit, hence why I am thinking of lowering its limit to something nominal (say £500), then once that cashback is paid out then cancel it.

[leef44]

Your credit score has probably dropped slightly due to very little credit activity i.e. not taking out big loans. But the drop should be minimal, such that it should not impact you getting another credit card or upping the limit.
Again, having a number of credit cards also reduces your score but probably to a minimal effect so of no consequence to you.

[gumshoe]

It doesn't matter if the limit is high, as long as it is not used. It's if you max out all your cards or are at a high saturation on all/lots of your credit lines that can cause an adverse effect on your credit.

[GrizzlyBear]

leef44 said:

Your credit score has probably dropped slightly due to very little credit activity i.e. not taking out big loans. But the drop should be minimal, such that it should not impact you getting another credit card or upping the limit.
Again, having a number of credit cards also reduces your score but probably to a minimal effect so of no consequence to you.

My current card provider has cut the cashback percentage so I am looking for a new card.

gumshoe said:

It doesn't matter if the limit is high, as long as it is not used. It's if you max out all your cards or are at a high saturation on all/lots of your credit lines that can cause an adverse effect on your credit.

I am never anywhere near the limit on my cards, they have always been paid in full every month.

So basically I should just apply when I find a card I like. I was thinking of reducing the credit limit on the credit cards, but if that is not required, that is fine. I will be getting rid of at least one of the cards once the annual cashback payment has been recieved, oh well, learn something new every day. Cheers.

[WattsieST170]

If it's a Barclaycard there is a feature somewhere in the online banking dashboard to view your credit score.

If not, there are free credit reference agencies like noddle.co.uk which will list your credit score and also any accounts, credit cards etc. that exist for you. It will also show credit history such as missed/defaulted payments and any other info, like if you are 'connected' with a 3rd party (e.g. if you have a partner and you share a join bank account)