How Many Cards

[Ariel]

I am about to pay all of my credit cards off (about $9k total) this week.  I currently have 12 cards... this is too many.  I think I need to close at least half of them... how should I determine which ones I close?  Some of them have high limits, but also high APR's... some of them have low limits and low APRs.. others have low limits and high APR's... My oldest one was opened in 2001, my newest in 2008 (Jan).  

A little background.... used to have good credit, got a conventional mortgage loan in '04, got a little crazy with the cards... my scores went down to the mid/low 400's for a while.. Last November (2007), I decided to start improving my credit.. have not had any late pays since then, corrected some errors on the credit reports, wrote PFD letters, etc.  Right now I'm back at 600 for all three, but the high util I have is really killing me, which is why I'm going to just bite the bullet and pay this stuff off.   I plan to PIF on the cards  I keep (I think I'll put one small recurring charge on each card so they show activity and then PIF).  

I don't want my score to go down because I close cards... I am worried about my average age of accounts too (some of my worst APR cards are ones that I've had for a few years).  Or, should I not even worry about APR, since I'll be PIF every month?

[haulingthescoreup]

I wouldn't close anything, unless it has an annual fee and they refuse to budge.

As you said, look for recurring bills that your can pay by CC. Assign one to each card that you don't want to use on a regular basis, and then stick these cards into your sock drawer. And don't forget to pay your bills each month!

Congrats on the decision to pay off your cards. For scoring purposes, only let one or two cards actually report balances. Don't let them all report!. Pay the others as soon as the charges hit, and several days before the statement will drop. Except for HSBC/ Orchard bank cards, that will ensure that they report $0.

This way you're not going out and randomly charging things that you wouldn't normally buy, but the cards will stay alive. You can do something similar with buying gas. One tank per card, etc.

Before you do anything, please read fused's Closing Credit Cards. It's stickied up above, and it's also linked in my siggy.


eta: After you look at the possibilities, it's fine to go ahead and close the duds. Just make sure that your total CL isn't affected too badly. For instance, I have a Best Buy store card that I hardly ever use, and I don't like HSBC (the bank behind the card), so I keep flirting with closing it. But it has a $2500 CL, which is hard to blow off. But I got a CLI on a different card, so I can afford to close it if I decide to do so. I just haven't figured out why, other than HSBC is a PITA and has lots of little challenges involving paying your account on line and getting it credited promptly.

Message Edited by haulingthescoreup on 12-06-2008 10:19 AM

[Anonymous]

i would kill anything under $1k(unless its your oldest account) personally if they wont increase it or if there is high annual fee. can you make a list of bank limit year open

[wmarat]

If you have multiple cards from the same lender, you can combine them.