Quote Originally Posted by Bretsky
I don't think individuals are penalized at all credit wise if they have access to 40G but only have balances of 2500. In reality the reason they have so much available is because their credit is good.
Far be it from me to argue with a banker, but I will!

I don't think that is entirely correct. Its not a serious penalty, but your credit score can be decreased for high outstanding available credit lines. I was real curious when the annual free reports came out last year, so I called and talked to a couple. One of the things I found out was that if you have a lot of unused credit cards, such that you could, if you were of a mind to do it, go out and charge $50,000 tomorrow using 25 different cards, you will lose some score points because of it.

The solution is simple. You call some of the unused card companies, and formally cancel the card. You can even request them to report that to the credit agencies.

It's kind of a Catch 22, though, because it also is not good if you have no available credit, or so I was told. It's good to have some, but not too much!