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Old May 12, 2024 | 2:04 am
  #17  
rtv4
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Join Date: Jan 2023
Posts: 209
Originally Posted by JamesBigglesworth
That's NOT how credit lines work with mortgage applications.

Lenders *want* to see credit lines because credit lines *INCREASE* your credit score. They want to see the lines in place AND NOT USED or with very low utilisation levels. Most credit score systems (And ALL the American ones, which make up the two major ones used in NZ) regard under 5% utlisation as ideal. Your credit score *increases* the more unused credit you have.
It isn't about credit score though, you have to disclose the credit limits to the lenders which factor into their affordability calculation.

Just having a credit card open but never used will cause them to reduce your maximum borrowing capacity.
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