Reply
Member
Posts: 9
Registered: ‎04-09-2008
0

closing credit card accounts

 i have about 6 credit cards and 4 store cards that all have zero balances.  i would like to close the accounts and operate on a cash basis only.  is this a really bad idea?  should i just let the accounts close from not using them?

 

Regular Contributor
Posts: 128
Registered: ‎12-21-2008
0

Re: closing credit card accounts

Yes - it will damage your credit & a good credit rating isn't just good for borrowing - some employers now check credit, as do rental agencies.

 

Just put them in your sock drawer.


Starting Score: 527
Current Score: 679
Goal Score: 800


Take the myFICO Fitness Challenge
Member
Posts: 9
Registered: ‎04-09-2008
0

Re: closing credit card accounts

but won't that in itself cause the credit card companies to close the accounts for non- use.  and from what i read it seems like it is better to have the accounts closed at the card holder's request rather than by the credit company itself.
Moderator Emeritus
Posts: 4,470
Registered: ‎12-31-2008
0

Re: closing credit card accounts

Perhaps moderation would work best.

 

Consider keeping open your two or three oldest cards.

Your store cards are limiting and can all be closed.

If your store cards are your oldest, check your AAofA when choosing what to close.

 

Congratulations on your decision to only buy what you have cash to pay for.  If you choose to make your purchases on your cc's, and PIF immediately, you will have all the advantages of not carrying debt, plus the advantage of keeping your FICO high.

 

I would recommend that you choose which accounts to close, rather than letting your lenders choose for you.

 

Good luck!

Just puttin' syrup on something, don't make it pancakes.
Frequent Contributor
Posts: 488
Registered: ‎04-09-2008
0

Re: closing credit card accounts

If you plan on using cash forever, no auto loans, no mortgage no store credit etc. and you don't mind never having the oppurtunity to rent a car and don't mind higher car insurance then by all means close your cards. If you think you might need those things, then keep the cards open and mange your credit.
Super Contributor
Posts: 5,744
Registered: ‎01-28-2008
0

Re: closing credit card accounts

Don't do a Dave Ramsey.  It's great you have  zero balances, but don't punish yourself by closing the cards. 
Moderator Emerita
Community Leader
Epic Contributor
Posts: 28,098
Registered: ‎04-01-2007
0

Re: closing credit card accounts

Put one recurring charge per month (cell phone bill, cable bill, landline, whatever) on each bank card. Leave them in the drawer, but they'll be used for expenses that you have already. You'll just pay the CCC's online, instead of paying Verizon/ Comcast/ AT&T, etc. Use another card for gas, another for groceries, etc.

Then you can use cash for anything else.

It takes a long time to build up good, clean credit. It's truly a PITA to have to start all over again.
* Credit is a wonderful servant, but a terrible master. * Who's the boss --you or your credit?
FICO's: EQ 781 - TU 793 - EX 779 (from PSECU) - Done credit hunting; having fun with credit gardening. - EQ 590 on 5/14/2007
Established Contributor
Posts: 662
Registered: ‎09-07-2007
0

Re: closing credit card accounts

I use CC's for credit and for the rewards. Why can't you use the card for everyday purchases and make sure you PIF. that way you'll keep your credit score up and collect the rewards. I'm getting at least $100+ every other Month from National City just for using there card and paying the balance off in full.
Advice is what we ask for when we already know the answer but wish we didn't.
Frequent Contributor
Posts: 265
Registered: ‎05-15-2009
0

Re: closing credit card accounts

[ Edited ]

I have 2 CC accounts that were closed by the CC companies, was laid off and went OTL.  I still have balances on them which I pay on time every month.  My questions are: Are the on time payments on these closed accounts helping my fico score?  Are these closed accounts still counted towards the average age of  my accounts. I plan on applying for a mortgage in Sept of 2010 and was wondering what is the bet course of action. Paying on them  ( for the sake of having more on time payments on CR) until I apply forthe mortgage, or to have them PIF soon as possible. I need about 40 points added to my mid score, so I really need to know whats the best course of action.... The balances are relatively low, about $450 combined.

 

 

Thanks

Message Edited by bigman023 on 11-17-2009 09:54 AM
Message Edited by bigman023 on 11-17-2009 09:55 AM
5/2009 EQ-504(FICO), TU98-567(FICO), EX- 503 (FAKO)
10/17/11 EQ-633, TU04-652, EX-681 All lender Pulls
10/17/11 TU98-678
12/21/2012 TU98-677 (39% Util)
01/21/2012 EQ - 661 (37% Util) SW Alert
Moderator
Posts: 16,010
Registered: ‎07-14-2009
0

Re: closing credit card accounts


bigman023 wrote:

I have 2 CC accounts that were closed by the CC companies, was laid off and went OTL.  I still have balances on them which I pay on time every month.  My questions are: Are the on time payments on these closed accounts helping my fico score?  Are these closed accounts still counted towards the average age of  my accounts. I plan on applying for a mortgage in Sept of 2010 and was wondering what is the bet course of action. Paying on them  ( for the sake of having more on time payments on CR) until I apply forthe mortgage, or to have them PIF soon as possible. I need about 40 points added to my mid score, so I really need to know whats the best course of action.... The balances are relatively low, about $450 combined.

 

 

Thanks



Welcome to the forums.

 

Are these closed accounts still counted towards the average age of  my accounts

 

Yes they will continue for up to 10 years after being closed.

 

Paying on them  ( for the sake of having more on time payments on CR) until I apply forthe mortgage, or to have them PIF soon as possible.

 

My advice is always to PIF any debt when possible. Don't stay in debt for a few FICO points. Being out of debt should be the #1 priority. IMO.

 

 

(myfico)
7/09 TU-742 EQ- 779
8/09 TU-765 EQ- 783
9/09 EX pulled by lender 802

 

CC interest free as of 8/09
Time can heal all wounds and a low FICO.
"Hello my name is Sandy and I'm a recovering crediholic".

Advertiser Disclosure: The listings that appear on myFICO are from companies from which myFICO receives compensation, which may impact how and where products appear on myFICO (including, for example, the order in which they appear). myFICO does not review or include all companies or all available products.

Copyright ©2001-2015 Fair Isaac Corporation. All rights reserved.   | Terms of Use | Privacy Policy | Sitemap

IMPORTANT INFORMATION: All FICO® Score products made available on myFICO.com include a FICO® Score 8, along with additional FICO® Score versions. Your lender or insurer may use a different FICO® Score than the versions you receive from myFICO, or another type of credit score altogether. Learn more

FICO, myFICO, Score Watch, The score lenders use, and The Score That Matters are trademarks or registered trademarks of Fair Isaac Corporation. Equifax Credit Report is a trademark of Equifax, Inc. and its affiliated companies. Many factors affect your FICO Score and the interest rates you may receive. Fair Isaac is not a credit repair organization as defined under federal or state law, including the Credit Repair Organizations Act. Fair Isaac does not provide "credit repair" services or advice or assistance regarding "rebuilding" or "improving" your credit record, credit history or credit rating. FTC's website on credit.