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Established Contributor
snowkitty
Posts: 985
Registered: ‎09-10-2012
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Preparing to close cards.....please advise

I'm about 18 months into my credit rebuild and have accumulated a really good line up of cards that I am happy with. I have a few cards that I want to close because I am not really getting anything out of them at this point. I am going to close 3 of the cards within the first 3 months of 2014. My plan is to close 1 per month. So my first question is will that be ok or should I stagger them over 6 months instead?

 

Also, together the cards equal 2300.00 in available credit that I don't want to lose. I have been eyeing the Boa travel rewards card for a while now and they are offering me  20,000 points for a 500.00 spend in 3 months. That's 200.00 in travel credit and I would like to take them up on that. If I app'd and am approved for that, I'm sure that would make up for the credit amounts I am about to lose. So would it be smart to app for that now to be prepared? Normally the spend bonus is only 10,000 point so I think it's a good deal.

 

But I do worry because my available credit is 20,000.00 above my income so am I in a place where opening another card will cause cld on other cards? My utilization right now is at about 10% because I am carrying Christmas shopping and a balance transfer for 0% interest.

 

Just in case it matters, here are the cards at I am going to close.....

 

BP  400.00

VS  900.00

Brylane Homes  1000.00

TU Fico 714 | Sesame 742 | Credit Karma 762 | Wal-Mart FICO 734 | EX FICO 695 (1/28/13) | EQ 740 (3-21-13)

Amex Blue Sky 7.2k | Amex BCE 13.1k | Citi Diamond Preferred 10.2k | CSP 5k | Bofa Cash 9k | Boa Travel 10k | Discover More 3k | Chase SW 5k | Wal-Mart 3.3k | Amazon 5k | Old Navy Visa 5k | Shell 1200 | BP 400 | VS 1500 | Sam's Discover 8.5k | FNBO Amex 16k | Chase Freedom 1.3k | Home Depot 5k | Brylane Homes 1600 | BML 2820

App free since 12/11/13*
Established Contributor
chwebb1
Posts: 558
Registered: ‎10-11-2013
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Re: Preparing to close cards.....please advise

If your total credit lines are $20,000 over your annual salary, I wouldn't worry about losing $2300. Also, why not just close them at the same time?

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$5000 ............ $4300 ............ $4000 ............ $2750 ............ $2500 ............ $1000 ............ $1000 ............ $1000
In the Garden until at least May 2015.
Established Contributor
snowkitty
Posts: 985
Registered: ‎09-10-2012
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Re: Preparing to close cards.....please advise


chwebb1 wrote:

If your total credit lines are $20,000 over your annual salary, I wouldn't worry about losing $2300. Also, why not just close them at the same time?


If I were not running balances for the next year, I would not be worried about the 2300.00. I don't want my utilization to go any higher than 10%. I'm not going to be requesting any cli's on other cards next year. Those 3 cards are my first cards to close but I have my eye on a few others for later in the year.

 

I just don't know how it would look if I closed them all 3 at one time. I thought it would be better to stagger them out a bit.

TU Fico 714 | Sesame 742 | Credit Karma 762 | Wal-Mart FICO 734 | EX FICO 695 (1/28/13) | EQ 740 (3-21-13)

Amex Blue Sky 7.2k | Amex BCE 13.1k | Citi Diamond Preferred 10.2k | CSP 5k | Bofa Cash 9k | Boa Travel 10k | Discover More 3k | Chase SW 5k | Wal-Mart 3.3k | Amazon 5k | Old Navy Visa 5k | Shell 1200 | BP 400 | VS 1500 | Sam's Discover 8.5k | FNBO Amex 16k | Chase Freedom 1.3k | Home Depot 5k | Brylane Homes 1600 | BML 2820

App free since 12/11/13*
Valued Contributor
FinStar
Posts: 6,922
Registered: ‎10-21-2012
0

Re: Preparing to close cards.....please advise


chwebb1 wrote:

If your total credit lines are $20,000 over your annual salary, I wouldn't worry about losing $2300. Also, why not just close them at the same time?


+1

 

You don't need to stagger them unless your utilization will increase based on losing $2,300 in CLs.  Alternatively, you could apply for the BOA CC now, and if approved, then close them.  If the cards are no longer providing any benefit to you and do not foresee using them or you feel it would be too much upkeep then you can close them.

Valued Contributor
RockinRay
Posts: 1,947
Registered: ‎08-13-2007
0

Re: Preparing to close cards.....please advise

Just close them and do not look back!

 

I have been doing this for the past 6 months or so, and my scores have gone UP as a result.

Ray

** Every Card has a Job, and Every Card does its Job **

Established Contributor
snowkitty
Posts: 985
Registered: ‎09-10-2012
0

Re: Preparing to close cards.....please advise

I really do need to close the cards. The BP card is just not growing and I get better rewards by getting my gas on other cards. The vs was just a stepping stone card but I only use it at bath and body works which brings no rewards. I just went in to bbw this week for Christmas shopping and spent 100.00 and put it on my amex for the points. The brylane home was also a stepping stone and I struggle to use it because their merchandise is more expensive than it is in stores, plus I get no rewards for what I do purchase. I have to close that one in March or April of next year because I just ordered something there using deferred billing so that the card did not close on it's own. I want the closed accounts to show that I closed them, not the creditor.

 

I do think the boa travel rewards card will benefit me because I am trying accumulate points on other cards to pay for a vacation next summer. I have banked points on my Amex Blue Sky and CSP which will take care of hotels but the boa travel rewards card lets you use points for amusement parks and places like that which the others don't. I'm just worried about having more available credit. Am I too far over my annual salary already? I don't want any accounts closed or cld's because of it.

TU Fico 714 | Sesame 742 | Credit Karma 762 | Wal-Mart FICO 734 | EX FICO 695 (1/28/13) | EQ 740 (3-21-13)

Amex Blue Sky 7.2k | Amex BCE 13.1k | Citi Diamond Preferred 10.2k | CSP 5k | Bofa Cash 9k | Boa Travel 10k | Discover More 3k | Chase SW 5k | Wal-Mart 3.3k | Amazon 5k | Old Navy Visa 5k | Shell 1200 | BP 400 | VS 1500 | Sam's Discover 8.5k | FNBO Amex 16k | Chase Freedom 1.3k | Home Depot 5k | Brylane Homes 1600 | BML 2820

App free since 12/11/13*
Senior Contributor
alvon123
Posts: 9,028
Registered: ‎09-24-2013
0

Re: Preparing to close cards.....please advise



You don't need to stagger them unless your utilization will increase based on losing $2,300 in CLs.  Alternatively, you could apply for the BOA CC now, and if approved, then close them.  If the cards are no longer providing any benefit to you and do not foresee using them or you feel it would be too much upkeep then you can close them.


+1


Valued Contributor
takeshi74
Posts: 3,217
Registered: ‎06-05-2013
0

Re: Preparing to close cards.....please advise

[ Edited ]

snowkitty wrote:

I'm about 18 months into my credit rebuild and have accumulated a really good line up of cards that I am happy with. I have a few cards that I want to close because I am not really getting anything out of them at this point. I am going to close 3 of the cards within the first 3 months of 2014. My plan is to close 1 per month. So my first question is will that be ok or should I stagger them over 6 months instead?


I doubt it really matters either way.  Your score will be immediately impacted by the increased utilization.  Staggering won't make any difference aside from spacing out the utilization increases.  Closed accounts in good standing continue to report for 10 years so AAoA isn't immediately affected.

 

If you're looking to eliminate or reduce the impact on utilization then see if you can PC or transfer the credit limits.

 


snowkitty wrote:

 

If I app'd and am approved for that, I'm sure that would make up for the credit amounts I am about to lose. So would it be smart to app for that now to be prepared? 


Your call.  You could possibly regain the limits or somewhat mitigate your losses (no guarantees) but you'd take a hit to AAoA from opening a new account plus the hard pull.

 


snowkitty wrote:

 

But I do worry because my available credit is 20,000.00 above my income so am I in a place where opening another card will cause cld on other cards?


Seems unlikely but it's impossible for us to say.  I can give you some anecdotal evidence that my available credit is ~$50K above my income with no adverse action.  However, that probably means nothing considering our credit isn't the same and it's not a matter of "X over income" but the ratio of X to income.

 


snowkitty wrote:

I don't want my utilization to go any higher than 10%.


Have you done the math?  It might help you in your decision making.  If your signature is up to date (and I didn't make any mistakes despite running the numbers through my calculator twice) then your available total credit is $89,270.  10% is $8,927.  $8,927/($89,270-$2,300) = 10.3%.  Is that worth fretting over to you?  You indicated that you were not requesting any CLI's and you don't seem interested in apping for anything aside from possibly mitigating lost limits from closures.  I wouldn't worry over a delta of 0.3% and I don't see the point in obsessing over 10% (my utilization tends to fall at about 12% anyway though) when not apping or requesting CLI's but it's ultimately your call.

Established Contributor
snowkitty
Posts: 985
Registered: ‎09-10-2012
0

Re: Preparing to close cards.....please advise


takeshi74 wrote:

snowkitty wrote:

I'm about 18 months into my credit rebuild and have accumulated a really good line up of cards that I am happy with. I have a few cards that I want to close because I am not really getting anything out of them at this point. I am going to close 3 of the cards within the first 3 months of 2014. My plan is to close 1 per month. So my first question is will that be ok or should I stagger them over 6 months instead?


I doubt it really matters either way.  Your score will be immediately impacted by the increased utilization.  Staggering won't make any difference aside from spacing out the utilization increases.  Closed accounts in good standing continue to report for 10 years so AAoA isn't immediately affected.

 

If you're looking to eliminate or reduce the impact on utilization then see if you can PC or transfer the credit limits.

 


snowkitty wrote:

 

If I app'd and am approved for that, I'm sure that would make up for the credit amounts I am about to lose. So would it be smart to app for that now to be prepared? 


Your call.  You could possibly regain the limits or somewhat mitigate your losses (no guarantees) but you'd take a hit to AAoA from opening a new account plus the hard pull.

 


snowkitty wrote:

 

But I do worry because my available credit is 20,000.00 above my income so am I in a place where opening another card will cause cld on other cards?


Seems unlikely but it's impossible for us to say.  I can give you some anecdotal evidence that my available credit is ~$50K above my income with no adverse action.  However, that probably means nothing considering our credit isn't the same and it's not a matter of "X over income" but the ratio of X to income.

 


snowkitty wrote:

I don't want my utilization to go any higher than 10%.


Have you done the math?  It might help you in your decision making.  If your signature is up to date (and I didn't make any mistakes despite running the numbers through my calculator twice) then your available total credit is $89,270.  10% is $8,927.  $8,927/($89,270-$2,300) = 10.3%.  Is that worth fretting over to you?  You indicated that you were not requesting any CLI's and you don't seem interested in apping for anything aside from possibly mitigating lost limits from closures.  I wouldn't worry over a delta of 0.3% and I don't see the point in obsessing over 10% (my utilization tends to fall at about 12% anyway though) when not apping or requesting CLI's but it's ultimately your call.


Thanks for breaking that down. I've worked numbers but am concentrating too much on overall credit available rather than the utilization. 0.3% does not make that much of a difference. I'm also really tempted to app for the travel rewards card but where I once was not afraid to app for a new card, I am now terrified! Now instead of worrying about obtaining credit to establish myself, I am worried about hp's, too much credit, aaoa, etc. The card will benefit me but I am also afraid to lose what I have worked so hard for. I know I mentioned closing the 3 cards but later next year I would like to close amazon, walmart & my freedom card. Amazon & Wal-Mart are not earning me anything and now since I have the CSP, I would like to move the credit line from my freedom to my CSP and then close it. I'm just not sure if that is a good idea to close so many in a year. I opened so many in 2012 and then would be closing so many in 2014. I don't want to look reckless. I'm just at a point right now where I only want to use cards that benefit me if that makes any sense.

TU Fico 714 | Sesame 742 | Credit Karma 762 | Wal-Mart FICO 734 | EX FICO 695 (1/28/13) | EQ 740 (3-21-13)

Amex Blue Sky 7.2k | Amex BCE 13.1k | Citi Diamond Preferred 10.2k | CSP 5k | Bofa Cash 9k | Boa Travel 10k | Discover More 3k | Chase SW 5k | Wal-Mart 3.3k | Amazon 5k | Old Navy Visa 5k | Shell 1200 | BP 400 | VS 1500 | Sam's Discover 8.5k | FNBO Amex 16k | Chase Freedom 1.3k | Home Depot 5k | Brylane Homes 1600 | BML 2820

App free since 12/11/13*

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