05-07-2011 11:40 AM
When you say "close", I assume you mean which to pay off first, and then close. Normally it makes the most sense to pay off the highest interest cards first.
This doesn't necessarily hold true in your case, however, because of the annual fee - besides the fact that the (obscene!) interest rates are all roughly the same (about 2% per month, say $4 a month per card right now). So I would focus on paying off as much as you can on the card which has the earliest annual fee due date. You sure don't want to pay an annual fee on top of the interest!
It so happens that Orchard has the earliest anniversary date AND the highest interest rate. This should be followed by HSBC, and then Credit One. Credit One has a higher interest rate than HSBC - but who cares in this case?
If it weren't for the annual fee, it would make sense to keep them all open, as you will have low utilization on them as you pay them down and off (assuming you rarely use them again!) But the annual fee of $75 and $59 on a very low limit card is not worth it. Taken together, that's $209 - enough to pay off a complete card balance. By closing them, you will eventually lose a tiny bit of credit history, but, IMHO, you are in a rebuilding phase anyway. Clean slate!
NOTE: It might make sense to close all three right now, providing there is no penalty or demand for immediate payment for doing so. This may freeze your CL's right where they are now, and as you pay down your balances, it will decrase your your utilization. BUT CHECK WITH THE CC COMPANY FIRST TO MAKE SURE THERE WILL BE NO PENALTY OR DEMAND, AND ASK HOW THEY WILL REPORT THE CREDIT LIMIT ON THE CLOSED ACCOUNTS TO THE CREDIT REPORTING AGENCIES.
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