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16. 3 million consumers in the UK have typically 2. 3 credit cards they no more use - that's a total associated with 38 million cards, with an enormous collective borrowing limit of £ 200 billion, according to analyze from independent price comparison site uSwitch. Nevertheless, in today's economic climate, should we be leaving these abandoned credit accounts open 'just in case' or closing them the moment we switch to a new charge card? With unemployment on the rise and credit increasingly tricky to find, it might seem like a wise decision to keep an old credit card account open like a financial safety net, in case you lose your work, have your application for a new card declined or simply 'for a rainy day'. However, this is probably not the bright idea it seems - keeping credit cards you will no longer use could have a negative effect on your credit report, and even put you prone to fraud. Unused credit accounts can damage your credit score, because providers look at the total amount you may choose to borrow across all your credit company accounts. Therefore credit you aren't even utilizing, as well as what you actually owe as well as your repayment history, will be taken into account when you're applying for credit. It is also worth noting that providers sometimes near down these unused accounts or might even charge a fee to customers who avoid using their cards. Keeping credit cards you don't use anymore could also put you prone to fraud. Periods of recession tend to determine an uplift in fraud cases, and based on Credit Action, last year alone the shocking £ 54. 1 million was spent by fraudsters on lost and stolen charge cards and another £ 10. 2 million on cards intercepted within the post. This type of fraud could go undetected on charge card accounts that you aren't checking regularly - especially if you move house and forget to notify the card provider of the new address. Here are five tops tips that will help you avoid the credit card closure snare.
Check your credit report - it will highlight all your credit accounts and could alert you to definitely an old credit card you've overlooked about. It'll also help you to identify unfamiliar credit applications and unexplained amounts, which could indicate that you've already been a victim of fraud.
Close down accounts you do not use, particularly if you're applying for credit score - the available balance on these accounts will be taken into account when you are applying for a brand new card. You don't necessarily have to close all of your old credit cards - but if you have more than one or two, a spring clean is actually a good thing.
Sometimes, the best deals available on the market are only available to new cardholders, and by canceling your existing charge cards, after a short period you will be able to qualify as a 'new cardholder' once again.
Cutting up a credit card isn't just like us cancelling it. Cutting up a card might stop you from utilizing it, but you also need to get in touch with the card company and tell them you need to cancel. It's also a good idea to request a written confirmation of the cancellation too.
Sometimes, even though you've cancelled your card the account might not be closed. Credit card companies sometimes leave accounts dormant for some time in case any payments you've created haven't come through yet, so it's worth making a call a couple of months later to double check it's truly closed.







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