First premier bank CC

[Anonymous]

I have a FP bank credit card opend on September last year.

I have no balance with the credit card, but the balalce is always $7 due to the finance service fee.

This is really annoying, so I decide to close the account after paying rest of the finnace service fee.

But when I called the FP bank to close my account, the financial manager said that if I closed the account, it would drop my credit score badly.

So I am really confused now.

Is it true what the financial manager said?

What do you think about this?

Please give me an advice.

Thank you in advance

[Anonymous]

do you have any other cards?

I don't think they are supposed to comment

on your score.

MODS????????

[hawkeye33]

The manager most likely does not have enough information on which to base a statement like that. The factors that play into just how much closing an account CAN affect your credit score include how long your credit history is (the impact is much less if you have longer credit history, higher if you have very short credit history); how many other lines of credit you have and what your overall utilization is (your score would be hurt worse if by closing your FP card account your utilization would go up significantly); and several other factors.

The answer to whether or not closing the card will impact your score is....it might. It might not. The manager was probably trained to tell you that to try to keep your $7 per month coming in. If the card was not a significant portion of your overall credit portfolio, the impact will not likely be significant, especially since you have a $0 balance on it.

Read the following thread from this site for good information on closing credit cards:

http://ficoforums.myfico.com/t5/Credit-Cards/Closing-Credit-Cards/td-p/347190

[Wolf3]

The terms of the First Premiere cards are horrendous.   But I would not close it unless I had 1 or 2 other major cards.   Do you?

[Anonymous]

yes. I have capitalone and chevychase.

so is it ok to close this FP bank CC?

[voidman]

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@Anonymous wrote:

yes. I have capitalone and chevychase.

so is it ok to close this FP bank CC?

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I would close the account, depending on thel limits on Cap1 and chevychase, either way even if both are $500, i would close FP.

$7/month is  lot of money, good fico is to help you save money (IMO)

If you do not have any debt on the cards and can pay in full, then you can get your score up to a good level maybe 700 soon (maybe 1 year) using those 2 cards alone. But in the next one year you might get better offers and higher CL cards to help you boost the score up. Trick is to report %util less than 9% and above 0%.

[Anonymous]

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@voidman wrote:

But in the next one year you might get better offers and higher CL cards to help you boost the score up.

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I agree with voidman - your scores can be high with just one or two cards, especially if you keep your utilization below 9%.  (DH had an 800+ EQ FICO with just one Orchard CC - $500 CL). 

But better offers and higher CL cards do not boost FICO scores.  (You will see that advice on fako sites - PLUS, for example, gives that advice frequently.  But CL's won't affect your FICO.)

FICO does like a bank card - CapOne meets the criteria and FICO only needs one bank/national cc to be happy. 

ETA:  IMO:  I would close the FP in a heartbeat.  Absolutely.  They are scoundrels - as evidenced by their credit policies and the smunchy comment by the CSR.  Ridiculous comment on his part - reminds me of those old fashioned snake oil salesmen.  Eeeek.  DH and I have both closed several accounts in the past year, have yet to see an accompanying credit score decrease.  Have seen a few score bumps with closures, though!

[voidman]

beamMEup,

yes higher CL does not really help in fico score, I should have been clear with what I meant. What I wanted to say was higher CL would help to maintain 9% util bit easiy. Also another card would help to meet another fico booster criteria, i.e. cards reporting 0balance on < 50% cards. I am not sure about it, I think I had read it somewhere on this forum long back.

[Anonymous]

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@voidman wrote:

beamMEup,

yes higher CL does not really help in fico score, I should have been clear with what I meant. What I wanted to say was higher CL would help to maintain 9% util bit easiy. Also another card would help to meet another fico booster criteria, i.e. cards reporting 0balance on < 50% cards. I am not sure about it, I think I had read it somewhere on this forum long back.

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yep - I'm with you on both counts!

[Anonymous]

 I closed my 1st premier immediately when I saw a $300 cl

and 178 in fees.  It still reports to cras.

Looks like I used it.............but I didn't.