Which account to close?

[wizzywig27]

I am looing at closing some accounts:

I am trying to cut down on my credit (when applying for cards I am told that I have a high level of credit)....

I have two accounts:

Barclays: Premier account, £200 overdraft and £150 reserve usage
Halifax: Ultimate Reward with £300 overdraft.

I would like to get rid of my barclays as I have a dispute with them at the moment in regards to charges on my account, however I am wondering if I should remove the overdraft and reserve usage and make it a non fee paying current account with no overdraft, or if I should close it completely?

I definately now want to bank with Halifax (it was them that declined my credit card application based on having to much credit) so I am thinking if I pay my salary into it, plus close this account and another catalogue account that has a zero balance, this will help.

Come April I am also due to receive some money, so I will also be hoping to closing my Aqua credit card, my Capital One classic card and my Very or K&Co account, what does everyone think?

I currently have 3 defaults which drop off in the following order, Jan, Mar and Aug.

Vanquis - £3000 limit (once I sort out finances and defaults drop off I am hoping to do a B/T on this) – 54.9% APR
Aqua - £500 limit 34.9% APR
Capital One Progress - £200 limit 34.9% APR
Capital One Classic - £200 limit – 27.9% APR (which drops every few months to a minimum of 17.9%)
K&Co - £1000 limit – no APR
Very - £1700 limit – 39.9% APR
Next - £1500 limit – 29.9% APR (unless someone knows any different)?
2 x O2 contract lines
Barclays - £350 overdraft – no APR
Halifax - £300 overdraft – no APR

Recently closed:
Jacamo
Isme
JD Williams
Fashion World
Lloyds TSB
Santander
Nationwide

My monthly income is roughly £1900

[Diasflac]

Re: Which account to close?

Remove the barclays reserve, I used to have one and accidentally had to use it. The costs of using it are extortionate, I wouldn't advise anyone to use it ever, it's cheaper to get a payday loan - and that is saying something (I wouldn't use those either). My reserve was £0.50p a day of usage, thats £15.00 a month to use, regardless of how much.

Credit file improvement, I've been doing this for 3 years now, I have 18 defaults and an IVA, so where I can I try to improve my credit because I'd like a mortgage. There's a backstory to my defaults I'll write a thread in a bit.

If you clear your overdrafts, keep them but stay out of them (get rid of the reserve though) this improves your credit score more than closing them, with bank accounts especially. Your score is based on several things, address history and electoral roll. Payment history, amount of credit you have available, amount of that credit you're using. As well as any court judgements or insolvency. Lastly, credit searches.

The best way to keep your score up is to have a moderate amount of credit available with only about 15% per agreement of it used and no missed payments. With this you will be making regular sizable payments, and not using all your available credit. With an overdraft though, I'm not 100% on why this is but using your overdraft damages your credit file worse than having balance on a credit card. Someone else will probably be able to say why that is.

If you keep your overdraft, but don't use it you bring your available credit to used credit to a nice level, if you have a credit card with say £1,000 on it and you spend £150 and just make minimum payments of... about £5? A month this will slowly boost your credit score and you will find the company will probably keep boosting your card limit.