Close Old Account?

Anonymous · ‎08-21-2015

Hi guys,

A few months ago I decided to buy a new bed set which was a hefty 2.8k that I did not have at the time. RoomsToGo offered me 48 months of 0% APR. Naturally I applied for their finance option, which was just applying for their credit card (3.2k CL).

I have it down to 1.8k now and I hope to be done paying it in the next year. I dont ever plan to use that card again because the APR on it is stupid and really there is no benefit to it.

Since I dont plan to ever use that card again should I close it once Im done with it? Yes it will lower my total credit line, but assuming my utilization % is low anyway (sub 30 post closing the accont), would that be smarter than just letting the account sit there?

Also, is this credit card considered a department credit card?

Thanks

Anonymous · ‎08-21-2015

it'll show up as revolving credit or unknown. also, i would just let it sit until they close it for you since there's no fee. may as well milk the age while you can

Anonymous · ‎08-21-2015

So if I just do nothing for a while after paying it the account will close by itself?

And it wont have a negative impact on my score to sit there lifeles?

Thanks for your advise

Anonymous · ‎08-21-2015

it won't negatively affect it at all if you pay responsibly (which it sounds like you have and will)

Anonymous · ‎08-21-2015

Welcome to Myfico. Close it if you are not going to use it again. It will still report for the next 10 years.

Anonymous · ‎08-21-2015

^ also a true statement. some say to trim the fat (i have done that to two cards) and some say keep anything open not costing you money on annual fees. neither is right or wrong, just situational. regardless the 10 years from the day you close it is still a lot

taxi818 · ‎08-22-2015

@Anonymous wrote:
Welcome to Myfico. Close it if you are not going to use it again. It will still report for the next 10 years.

It will not report for 10 years. Staying on ones report and reporting are 2 different things. It will report once as closed. But it will factor into your AAOA. Just not in your utilization. Either way you would be fine close it or leave it open. Basically it will say. Closed by consumer. In good standing. That's the last time you will ever hear from them.

Anonymous · ‎08-22-2015

Opinions will always vary on this question. In my opinion, I would do as 2011xterror suggests, and keep it open. It doesnt hurt anything. It adds to your AAoA for however long you keep it open plus 10 years. It provides more available credit which will help if you are trying to keep utilization down at any time. Unless you are one of those people who just has to spend it because you have it available, it has 0 negative effects. It can only help.

kdm31091 · ‎08-22-2015

@taxi818 wrote:
@Anonymous wrote:
Welcome to Myfico. Close it if you are not going to use it again. It will still report for the next 10 years.
It will not report for 10 years. Staying on ones report and reporting are 2 different things. It will report once as closed. But it will factor into your AAOA. Just not in your utilization. Either way you would be fine close it or leave it open. Basically it will say. Closed by consumer. In good standing. That's the last time you will ever hear from them.

Taxi is right. "It will report for 10 years" is the common mantra, but really, it doesn't actively report for 10 years. It does exist on your report for 10 years, but the information won't be updated once the account is reported as closed.

With a limit of ~3k, there won't be much if any impact from closing it unless your util is otherwise very high or something. If it offers you no long term benefit (and such cards rarely do), then just close it. It doesn't hurt you to leave it open, since it has no fee and will age, but I'm a proponent of generally closing useless accounts. If it has no use to you, it's not going to suddenly have a use later, and it's just one more account to manage.

Anonymous · ‎08-22-2015

@taxi818 wrote:
@Anonymous wrote:
Welcome to Myfico. Close it if you are not going to use it again. It will still report for the next 10 years.
It will not report for 10 years. Staying on ones report and reporting are 2 different things. It will report once as closed. But it will factor into your AAOA. Just not in your utilization. Either way you would be fine close it or leave it open. Basically it will say. Closed by consumer. In good standing. That's the last time you will ever hear from them.

@taxi818,

What you are saying here is no different from what I stated just an FYI. A sensible person will know an account closed will report as closed.