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So I was just approved for a USAA Rewards Visa and I am unsure as to if I should close my USAA Platinum MC (opened in October 2012) and my AMEX BCE (backdated to January 2009). The interest rate on the USAA Visa I was just approved for is the exact same as it is on the USAA Platinum MC...so I figure I don't really need it since the Visa has rewards and has the same interest rate and higher limit. The AMEX BCE I don't use at all...however, according to my CR, it is the oldest account.
I am wondering if I have too many lines of credit open. I know especially within the past 12 months, I have racked up some inquiries and my AAoA has taken a dive...I've opened 5 accounts (I have closed 1 of the 5) within the last 6 months. I do plan to possibly purchase a home sometime in 2015.
So what should I do, should I close both the USAA Platinum MC and AMEX BCE? On a side note, I do plan to close my newly opened Citi ThankYou Premier card after the first AF (will be in December) and depending on whether I think the ThankYou Premier card is worth it, I'll convert my older Citi ThankYou Preferred MC account into Premier.
Any and all comments, suggestions are greatly appreciated!
I see no reason to close anything at this point, I am a believer in you cant have too many cards. If your going to go for a house next year they may actually help you out in getting qualified for your loan.
@gdale6 wrote:I see no reason to close anything at this point, I am a believer in you cant have too many cards. If your going to go for a house next year they may actually help you out in getting qualified for your loan.
True...however, I don't think I will have a problem getting a loan for a home but I am worried that too many open lines of credit might be seen as more of a risk and cause me to have a higher interest rate on that loan.
Just out of curiosity, why do you prefer the USAA cards over the BCE? USAA's rewards structure is terrible in general, let alone compared to the BCE. I support the idea of closing accounts you never plan on using, but I would think the BCE is one of the better rewards cards in your wallet.
@GeneralCucumbre wrote:
@gdale6 wrote:I see no reason to close anything at this point, I am a believer in you cant have too many cards. If your going to go for a house next year they may actually help you out in getting qualified for your loan.
True...however, I don't think I will have a problem getting a loan for a home but I am worried that too many open lines of credit might be seen as more of a risk and cause me to have a higher interest rate on that loan.
Another way of looking at it if you have low utilization it shows you handle credit responsibly.
@GeneralCucumbre wrote:
I am wondering if I have too many lines of credit open. I know especially within the past 12 months, I have racked up some inquiries and my AAoA has taken a dive...I've opened 5 accounts (I have closed 1 of the 5) within the last 6 months.
That's up to you to determine. There's no "X is too many" that applies to everyone. You need to decide based on what you can reponsibly manage, what you need/want and your goals and priorities. Some use the strategy of keeping as many accounts open as possible. Some prefer closing accounts that are no longer useful. It's not a one-size-fits-all matter and you have to do what works for you.
Closing accounts will not help your AAoA. The impact from the inquiries won't be an issue once they're over a year and at two years they'll fall off.
What you don't seem to be considering is utilization. Utilization changes due to account closure will immediately affect your credit. Make sure you calculate your utilization changes before making any decisions.
@GeneralCucumbre wrote:True...however, I don't think I will have a problem getting a loan for a home but I am worried that too many open lines of credit might be seen as more of a risk and cause me to have a higher interest rate on that loan.
You'd have to verify that with the creditor that will handle your mortgage.