Leveling grey mods, regardless of how usefull you think they are, will inevitably result in running out of credits sooner rather than later. Selling grey mods (with the exeption of speed primary arrows and crit dmg primary triangles) may feel like you're wasting cantina energy, but it's in fact saving you credits.
Given the fact that you reached the cap (1000 mods) it's safe to assume you don't have nearly enough credits to level them all. That's why most players don't give a hoot about the mod cap. Sell junk, only level potentially good mods. You could keep the ones you leveled but turned out to be not so great without comming close to reaching the mod cap for a good while and keep the option to equip them if need be.
Having more than a 1000 un-equiped mods isn't a "good" thing.