Credit Cards

[ferferhess]

I know this question has prob been asked, but I can't seem to find it.  My sub-prime cards are only 3 years old or less.  Now I am qualifing for prime.  When do I close the sub-prime cards?  (I want to have 4 cards, with no AF.  Right now I have 3 sub-prime and one prime.) How long should I keep the sub-prime cc's around( 1 yr, 5 yrs....)?  I don't want to make the mistake of closing too soon!

My next question is I've heard that if you have had history with AMEX before that you can get them to add your old cc  history to your new card.  I have no clue how to ask for that ( i was a AU, so I'm not sure if I can ask).  I know, it's kind of a shot in the dark......but, the worst they can say is no!!!  Just not sure how to word it.  I don't want to blow my chances for saying the wrong thing.  I there a word for that?

Message Edited by ferferhess on 06-02-2008 01:21 PM

Message Edited by ferferhess on 06-02-2008 01:22 PM

[1111mel]

Are any of these subprime cards charging you annual fees?  If not, Don't Close Them.

[ferferhess]

Yeah they all do.....I'm willing to continue to pay the AF (or ask them to waive) for a while, just trying to figure out how long!

[Creditaddict]

I would add your other prime cards your looking for then dump the sub prime as soon as you got your credit mix your looking for.

and as far as amex reporting original date, like your other posting, I'm pretty sure that would only apply if this was your account, not auth. on it.

Message Edited by Creditaddict on 06-02-2008 10:59 AM

[ferferhess]

Will closing the card with the longest history bring my scores way down?  (I will be buying a house in 6 mo. to a year).....

[1111mel]

It will drop your average age of accounts.....Depending on how old the next card in line is would determine if the drop would be that bad or worth worrying about.  If you are going to buy a house in the next six months I wouldn't close anything and just continue to pay the fees.  Nor would I apply for new credit before you buy the house either.

[Creditaddict]

I might agree with not applying if you had good cards already, but your subprime cards are all probably under 1k and you just got amex at 9k, if you added 1 or 2 more in the 7-15k limits, that would drastically help prove you can pay larger things like a mortgage.  I would just make sure you do all the applying right now and then stop for the next 6 months, that will age all your accounts and you shouldn't look like your out trying to get into debt right before applying for mortgage.

[cheddar]

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1111mel wrote:

It will drop your average age of accounts.....Depending on how old the next card in line is would determine if the drop would be that bad or worth worrying about.  If you are going to buy a house in the next six months I wouldn't close anything and just continue to pay the fees.  Nor would I apply for new credit before you buy the house either.

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This is a common misconception, so I just want to clarify:

Closing a credit card will not drop your average age of accounts right now.  Closed accounts continue to report for ten years from the date they are closed, and during that time they continue to count towards average age.

When the account finally falls off ten years from now, it may lower your average age at that point (depending on what else you've got going on at that time), but you will not see an immediate average age effect if you close a card.

You will, however, see an immediate revolving utilization effect, since a the card's CL will be removed from utilization calculations as soon as the card is reported closed.

[ferferhess]

o.k., so basically if I just got approved for $9,000 at AMEX, then closing the low limit cc's wont be a problem. 

[Phouchg]

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cheddar wrote:

You will, however, see an immediate revolving utilization effect, since a the card's CL will be removed from utilization calculations as soon as the card is reported closed.

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What if you close a card with a balance...is that taken out of the util calculation??