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Closing cards that helped rebuild credit?

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majortom
New Member

Closing cards that helped rebuild credit?

I have two cards with super low balances that charge a monthly fee. I screwed my credit up years ago and have worked hard at fixing it. The two cards in question have balances of $600 and $1200. I just closed on a house, and have multiple cards with no fees with balances over $15000 each. My oldest card only has a balance of 350, but no fees, so I'm going to keep it open since it's been open over 10 years. I paid off my 2013 truck last year, and have no plans on buying a new one anytime soon. 

 

I called one card to see if they'd drop the fee and they said they couldn't, so I said I'd like to close it and they magically were able to waive the fee for three months. I'll try again in another three months. 

 

Having worked hard to rebuild my credit, I know all about the AAoA. Having just bought a house, paying off the truck, and having those fee free way higher limit cards (that I haven't paid a penny in interest on), I'm conisdering closing the two fee ones if I can't get the fees waived. The purpose of the post is to ask what you guys would do. I have no plans on big purchases any time soon. Only thing I forsee happening is maybe a busniess expansion loan (already have two locations) and a new vehicle if i get into an accident, but I don't think closing either or both would hurt the score that much. 

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2 REPLIES 2
Kevin86475391
Frequent Contributor

Re: Closing cards that helped rebuild credit?


@majortom wrote:

I have two cards with super low balances that charge a monthly fee. I screwed my credit up years ago and have worked hard at fixing it. The two cards in question have balances of $600 and $1200. I just closed on a house, and have multiple cards with no fees with balances over $15000 each. My oldest card only has a balance of 350, but no fees, so I'm going to keep it open since it's been open over 10 years. I paid off my 2013 truck last year, and have no plans on buying a new one anytime soon. 

 

I called one card to see if they'd drop the fee and they said they couldn't, so I said I'd like to close it and they magically were able to waive the fee for three months. I'll try again in another three months. 

 

Having worked hard to rebuild my credit, I know all about the AAoA. Having just bought a house, paying off the truck, and having those fee free way higher limit cards (that I haven't paid a penny in interest on), I'm conisdering closing the two fee ones if I can't get the fees waived. The purpose of the post is to ask what you guys would do. I have no plans on big purchases any time soon. Only thing I forsee happening is maybe a busniess expansion loan (already have two locations) and a new vehicle if i get into an accident, but I don't think closing either or both would hurt the score that much. 


Just to clarify you do mean the cards have credit limits of of $600 and $1200 versus your credit limit of $15000+ on the other cards right? Rather than 'balances.' The term balance is usually used to refer to what you owe on the card, not how much available credit you have. Not to be pedantic or anything, just wanted to make sure we were on the same page, it sounds like we are since you also said you haven't been paying any interest - Way to go!

 

Anyway, my advice is that yes, you should absolutely drop these fee cards now that you have much better options. They served their purpose in helping you rebuild, but it's definitely time to cut them lose. Regarding your account age, that likely won't be impacted for quite awhile anyway. Generally positve, closed accounts will remain on your credit report for 10 years. So it'll be a long time before they fall off anyway, and your other accounts will have aged up considerably by then. If you are also paying all your cards in full each month, which it sounds like you are, then you also won't have to worry about your score dropping due to higher overall utilization - plus as you said, they have much lower limits than your other cards anyway. So yeah, bottom line I definitely say drop them! The fact that you don't plan to make any big purchases or apply for new credit in the nearterm is just icing on the cake. No reason I can see at all to keep them.

 

 

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majortom
New Member

Re: Closing cards that helped rebuild credit?

Oops, I did mean limits. Thanks for the reply! I wanted reassurance that it's the right thing to do. 

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