Close my Amazon synchrony store card?

Anonymous · ‎08-28-2017

So I came out of the garden and applied for and got the Chase Amazon visa.That means I won't be using my Synchrony bank Amazon store card anymore. Question is, do I close the store card? Or sock drawer it:

Pros of closing it: It's my ONLY store card, so if I close it, I will have zero store cards -- is that a good thing?

Cons of closing it: It's contributing $5k to my total util, which is not a lot, but it's something

The Chase card is giving me the same 5% back on Amazon, plus it's giving me extended warranties and purchase protection, and chase gave me $8500 whereas Synch only gave me $5000. So it's better. And I can use the Chase card when I travel outside the US to get 2% back on gas and restaurants (inside the US I have better cards for both those categories--but foreign fees make the Amazon card better outside the US.)

The Amazon store card has some financing deal / special rate on purchases that you can select at check out but I never finance anything, I'm a pay in full guy, so for me it's all about the cash back.

Anyway... normally I would keep cards open to keep the utilization... but in this case, what's the impact of it being a store card? Do I get a bonus for having no store card?

Anonymous · ‎08-29-2017

There is no FICO penaly for having store cards. The insurance industry uses non-FICO credit scoring models (e.g. the LexisNexis score) and in these there is some scoring penalty for having store cards. It's not clear that the penalty is softened by closing the card (though perhaps it is) -- i.e. to get the full benefit of having no store cards you may need to wait until a closed store card falls off your report.

You do not mention how old the store card is. To my mind that matters a lot more than the credit limit, since you can spend thousands of dollars a month with a small total credit limit and still have a reported utilization in the 1-5% range.

From your signature it looks like you have at least ten open revolving accounts, and all you realy need is three (arguably five) so you are fine there.

Anonymous · ‎08-29-2017

I would make the decision based on the age of the account. If it's one of your older cards, I'd keep it open and just take it out of the SD once every 6 months for a swipe just to keep it alive. If it's one of your oldest cards now, it will be one of your oldest cards 10 years from now, so you may as well keep it open to keep it aging which will positively impact your AAoA for a longer period of time.

AverageJoesCredit · ‎08-29-2017

Why not keep it. The sync version offers 6 months financing over $149 and at 5k that limit can easily be increased via sp whereas Chase is normally hard pull just to increase. I keep both mine for all the benefits of both plus the Sync one is good for utilization. In the end you must do what makes you comfortable. A $8500 offers abit more incentivw to keep over the Sync as opposed to my $1500 lol.

DantGwyrdd · ‎08-29-2017

If you decide to keep it make sure to use it every so often -- when I had it Synchrony severely CLDed it after a little over a year of no activity on it.

Anonymous · ‎08-29-2017

@DantGwyrdd wrote:
If you decide to keep it make sure to use it every so often -- when I had it Synchrony severely CLDed it after a little over a year of no activity on it.

Were there any other changes to your profile, score drop, or anything else that could have contributed to their decision to CLD that account of yours outside of simple non-use?

Anonymous · ‎08-29-2017

@AverageJoesCredit wrote:
Why not keep it. The sync version offers 6 months financing over $149 and at 5k that limit can easily be increased via sp whereas Chase is normally hard pull just to increase. I keep both mine for all the benefits of both plus the Sync one is good for utilization. In the end you must do what makes you comfortable. A $8500 offers abit more incentivw to keep over the Sync as opposed to my $1500 lol.

Well it can't easily be increased. It started out at $1000 and I CLI'd it up to $5000, but that was a year and a half ago. In the last 18 months Synch have consistently declined every attempt at a CLI. So one reason why I applied for the Chase card was frustration with Synch--and that paid off, Chase started me out at $8500. The importance of that ot me is now I can buy $750 or less of stuff a month on the card and not even worry about trying to pre-pay the balance -- it'll be such a low utilization, 9% or less, that unless I'm optimizing for a mortgage I can just let it autopay.

I don't really care about the financing, I don't buy anything unless I can afford to pay for it, I always pay in full, so that's a feature I will never use. I even saved up until I had enough cash to buy my last car without financing. Except for home buying, I try and never borrow money. I use credit cards for the cash back and points.

Anonymous · ‎08-29-2017

@Anonymous wrote:
You do not mention how old the store card is. To my mind that matters a lot more than the credit limit, since you can spend thousands of dollars a month with a small total credit limit and still have a reported utilization in the 1-5% range.

From your signature it looks like you have at least ten open revolving accounts, and all you realy need is three (arguably five) so you are fine there.

So it's 28 months old, and the AAoA of my account is now 23 months (with the addition of a 0 month Chase Amazon card).

One way to look at this -- of the cards I use and plan to keep long term, the AAoA is 20 months. There are 3 additional cards I will likely now never use (Amazon Store, FirstTech Visa, and RBC Bank) that are all >20months old, and they pull my AAoA up to 23 months. The RBC card is also my oldest card, being 3 months older than my Amex and BoA cards.

I guess then my plan will be this -- keep these three un-used cards open until the AAoA of my "keepers" is >2yrs. Probably keep the RBC card awhile longer since it has an $11k limit and since the extra 3 months age over my next oldest (BoA and Amex) probably still has some slight value. But I'll close the FirstTech and Amazon Store card once the AAoA of my "keepers" crosses the 2 year mark I guess. That means when they roll off my file in 10 years my AAoA will stay above 12 years on that day.

AverageJoesCredit · ‎08-29-2017

Easy peasy just close it then

DantGwyrdd · ‎08-29-2017

@Anonymous wrote:
@DantGwyrdd wrote:
If you decide to keep it make sure to use it every so often -- when I had it Synchrony severely CLDed it after a little over a year of no activity on it.
Were there any other changes to your profile, score drop, or anything else that could have contributed to their decision to CLD that account of yours outside of simple non-use?

Nope, I think I may have even gotten a letter to that effect (non-usage), but I really can't recall for sure since it's been a while, but it did happen at a time when my credit journey was just smooth sailing (no major varations in score, no new accounts, the only thing that stood out was the 15 months of non usage -- looked at a previous post from that time where I had the exact timeframe). Fun fact: they CLDed it to one M$ (i.e., $1024 -- you can tell a computer decided on the number).