Why not close unwanted credit card accounts?

Guest: mouse
SENIOR MEMBER (Member for 2 yrs.+)
Post subject: Why not close unwanted credit card accounts?
Posted: Mon Jun 12, 2006 1:05 am

Quote:

"cameron"
http://www.sfgate.com/cgi-bin/article.cgi?file=/chronicle/archive/2002/01/27/BU146130.DTL&type=business

I keep hearing this mantra never close a card. In my opinion its overdone. While closing a card wont necessarily help your credit score, if you do it right it doesnt need to hurt it either. Some people dont like to have 50 credit cards, and would prefer to just close the ones they are done with, if nothing else for simplicity. Also, there is more to getting credit than a credit score. If you want to get a mortgage, they look at other factors than FICO (such as income, etc).

I posted an article, food for thought...

NOW YOU CAN ALSO BE DENIED CREDIT or A CLI FOR...

"EXCESSIVE CLOSED TRADE LINES"

JUST FOOD FOR THOUGHT............

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Guest: Brammy
Posted: Mon Jun 12, 2006 6:56 am

[quote="WellManicuredMan"]Also remember to charge something to each card at least every few months so that the bank doesn't close them from inactivity. The amount doesn't matter. I have a card I don't care to use anymore but I have automatic payments set up for one of my regular monthly bills so the account stays open and my credit history remains longer.[/quote]

I have the same thing on a card that I plan to close in a year. The bill is for my VOIP telehone and less than 30 bucks but it causes them to report it every month with good payment.

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Guest: Brammy
Posted: Mon Jun 12, 2006 6:59 am

[quote="cameron"]http://www.sfgate.com/cgi-bin/article.cgi?file=/chronicle/archive/2002/01/27/BU146130.DTL&type=business

I keep hearing this mantra never close a card. In my opinion its overdone. While closing a card wont necessarily help your credit score, if you do it right it doesnt need to hurt it either. Some people dont like to have 50 credit cards, and would prefer to just close the ones they are done with, if nothing else for simplicity. Also, there is more to getting credit than a credit score. If you want to get a mortgage, they look at other factors than FICO (such as income, etc).

I posted an article, food for thought...[/quote]

I agree Cameron. My understanding is that too many open lines of unutlized credit will cause a lendor to give you a second look. Even though you are not using them currently, its available so they consider what would happen if you suddenly Maxed them all out. Could you still maintain payments on them?

My understanding is that if you are going to close any, make sure it is not your oldest account and consider what effect closing said account will have on the average age of your credit.

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CardRatings.com is the most comprehensive source for comparing credit card offers.  Please visit CardRatings.com to view the best rated credit cards!

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