Credit Cards

[RozBuds]

Hello, I am new to this board but do come by to read posts and replies and I love the information and advice given here. Everyone is always so helpful and polite. Here is my delima:

I just refied my home from 5.25 to 4.50. One of the conditions was escrow will pay off my CC debt which thrills me. Now I am frightened that with zero balances the CC companies will close my accounts. I have had two cut the limits and I am so, so with that. In your opinion do you think they will now close my accounts or just lower the limits? I have several credit cards and department store CCs but they are all zero bal. My department store CCs I use and payoff each month regardless. All my accounts are in excellent standing and have a long credit history. Always pay on time and much more than the min. due. The next statements that generate will all have no balance. I am tempted today to grocery shop and use a CC which I have never done. And on the others do a little online shopping to about $100.00 on each just so there is a balance and they won't close. I was listening to Suze Orman last night and she now thinks paying min. payments only is the way to go until the economy and CC companies get it together. She says the CC comapnies are opting to close accounts with no balances now more often than lower. Any advice or thoughts on this. Thank you.

[haulingthescoreup]

Hi, welcome to the ranks of the posters!

I wouldn't worry a bit about having $0 balances. However, if you want to hang on to your cards, you do need to keep using them. Then you just pay them off.

If you don't have a problem with managing CC debt, you can just stop using cash and put everything on CC's, ideally on a rewards cards so that you get something back. I also run my cell phone, etc through CC's. But I have $0 CC debt. I usually pay before the statement so that they also report $0, but the lenders don't care about that --that's strictly a scoring gimmick.

IMO, as long as you keep using each card and then paying it off, you'll be fine. For those with good credit histories, CLD's seem to come by across-the-board company policy, such as with BofA cutting limits by 50%, or for complete non-usage of the card.

Just keep them aired out, and you should be fine. If anything does happen, I'd say it would be due to that bank tweaking its balances again, as opposed to something on your part.

And congrats on the mortgage refi! Very nice rate.

[marty56]

I have 2 GEMB cards and a National City Visa.  I havent been the victim of CLD yet.  They are all at 0 balance and while in the best I revolved a balance on all of them, I havent done so in over a year.

PIF everything and as HTSU says you will be fine.

[Creditaddict]

and when Suze Orman talks about paying min. on credit cards, she is simply referring to someone who has credit card debt but no savings.  She then says pay min. on credit card debt and take the difference in monthly payments and put it into savings until you have 8 month emergency fund.  But if you already have savings, she is not suggesting you carry debt just for the sake of carrying debt and pay interest